Date 12 May 2009

A detailed three-year stimulus plan has been released by the Chinese State Council to restructure the nonferrous metal industry. This comes after a 45 percent drop in industrial profits in 2008. Nonetheless, the stimulus plan is expected to help the industry maintain steady operations in 2009 and achieve sustainable development by 2011.

The plan includes capital injection and also aims to improvise the export rebate policy to attract the inflow of high value-added and technologically advanced nonferrous products. Guidelines will also be provided to help optimize existing production capacities. In particular, no new projects will be allowed to develop electrolytic aluminum in the next three years, while the production of copper, zinc, titanium and magnesium will be strictly controlled.

Nonferrous metal companies will be encouraged to regroup and gain greater competitive advantage. Ideally, only three to five corporations with advanced production capacities and technology innovation capabilities will remain in the industry by 2011.

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