Japan To China: Slow Steel

Japanese officials worried that increase in Chinese steel output would hurt Japan’s economy.

Tokyo (AP) — Japan’s senior trade official has demanded China cut its steel production capacity amid concerns that sharp rises in Chinese output may cause global prices to fall, which could hurt Japan’s economy, a major newspaper reported Monday.

Tetsuhiro Hosono, director general of Japan’s Trade Ministry, made the request to Liu Tienan, director of the Industry Department of China’s National Development and Reform Commission, during their talks in Beijing last Tuesday, according to the Yomiuri newspapers online edition Monday.

Hosono made the unusual request because China’s crude steel output, which has made an annual increase of 20 percent in recent years, could affect steelmakers worldwide, including those in Japan, and eventually hurt the Japanese economy, the Yomiuri said.

Liu was willing to make efforts to cut China’s steel output capacity, which has expanded ahead of the 2008 Beijing Olympics, the report said.

Japanese trade officials were not available for comment Monday, a national holiday.

China is the world’s largest producer of raw steel, whose production has made a nearly threefold increase to 349 million tons over the five years through 2005, far exceeding the No. 2 Japan’s 112 million tons, the Yomiuri said.

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