China halfway to target to reduce coal capacity by 800m tonnes
Objective part of efforts to modernise nation’s economy and cut back heavily polluting industries such as coal and steel
China has hit the halfway point towards meeting it target of cutting coal mining capacity by 800 million tonnes a year by the end of 2020, the state planner said on Friday.
Tackling industrial and mining overcapacity has been a priority for Beijing to make China’s economy more efficient and environmental friendly. In its five-year plan for the 2016 to 2020 period, the government set the goal to reduce its coal production capacity.
Now, with coal mining capacity cuts of 111 million tonnes in the first half of this year, the total reductions for the period have been brought to 400 million tonnes, state planner the National Development and Reform Commission said.
The massive capacity cuts have burdened coal producers with mounting debt and roiled markets as utilities have struggled to find enough supply. Thermal coal prices in China have more than tripled since the start of 2016 due to the curbs on production.
The commission said this year it has been easier for coal companies to get bank credit and that producers have had fewer bad loans and reported fewer cases of unpaid wages to workers.