China's Iron and Steel Industry at the Global Markets Interface: Structural Developments and Industrial Policy Interventions
Keywords: China, steel industry, industrial policy, trade policy, foreign direct investment
AbstractIn recent years the Chinese iron and steel industry has gone through a period of hyper growth, propelling it to the very top of global steel-making. Commanding nearly half of global output and correspondingly utilizing a similar share of inputs and raw materials, China has become the key player in this industry, exerting significant influence on global prices and cost parameters. But just as the rise of China's iron and steel industry was not only driven by market forces but heavily influenced by government intervention in commodity and financial markets, government authorities are also trying to exert influence on the way Chinese steel-makers are acting on the global markets. Balancing market forces and industrial policy strategy at the global markets interface, political decision-makers have worked out an elaborate framework of measures to carve out maximum benefits for domestic enterprises and the economy as a whole. By examining these mechanisms, this article aims to illustrate that sectoral industrial policy in China does not push for expanding exports and investments across the board but carefully and discretionarily promotes global integration in some areas while delaying it in others.