What are the consequences of steel tariffs on the Chinese steel industry and its development? Coping with this question a deeper look at the Chinese steel industry is needed.
First, this paper will outline the history and examine statistics dealing with the global steel market in order to center the growth and structure of the Chinese steel industry. The second part of this paper highlights tariffs, their function and influence on the market in general and especially on the Chinese steel industry. Finally, derived from previously examined facts, the tariffs’ consequences on the industry are discussed concluding with a future outlook.
Since 2014, China is the second largest economy in the world, following the United States of America, comparing the countries’ gross domestic products. China’s steel industry dominates the global steel market, taking nearly half of the world’s production into account. In 2015, the country is the biggest exporter of semi-finished and finished steel products. Latest developments show a lowering and stagnating overall growth in China. This forces higher steel exports and puts pressure on the global steel price, leading to clamours for taxing Chinese steel imports in other countries. The U.S. and European Union (EU) among other countries have already confined tariffs on Chinese steel, aiming to protect their local steel industry.
Table of Contents
1 Introduction
2 The Chinese steel industry
2.1 Historical development
2.2 Domestic market and global position
2.3 China’s steel industry export figures
2.4 The development of the global steel price from 2008 to 2016
2.5 Tariffs on Chinese steel exports
3 Consequences
3.1 Influence on the Chinese steel industry
3.2 Future
4 Conclusion
Objectives and Research Focus
This coursework examines the current structural challenges within the Chinese steel industry, specifically focusing on the economic impact of international trade tariffs and domestic overcapacity on its future development.
- Historical evolution of the Chinese steel sector under the Five-Year Plans.
- Analysis of global trade dynamics and China's export dependencies.
- The relationship between global steel price fluctuations and domestic production.
- Evaluation of the impact of international tariffs imposed by the U.S. and EU.
- Strategic government measures to manage capacity and ensure industry sustainability.
Excerpt from the Publication
2.2 Domestic market and global position
China’s large-scale steel industry was only able to grow to today’s extent by enduring high demand. The domestic market had always been the main driver and consumer of steel, based on high demands typically in the sectors of:
• Automotive
• Construction
• Manufacturing
• Power generation
• Shipping
There is a strong interconnection between the steel industry as a supplier and the above named industries as market demand. This means stagnating and decreasing growth rates on the demand side result in a likewise move of the supply curve. (MarketLine, 2015, p. 14).
Summary of Chapters
1 Introduction: This chapter outlines the research background, noting China's dominance in the global steel market and the rising tensions due to tariffs imposed by the U.S. and EU.
2 The Chinese steel industry: This section details the historical development of the sector under China's Five-Year Plans, analyzes domestic and global market positions, export figures, price trends since 2008, and the function of trade tariffs.
3 Consequences: The chapter explores the socio-economic impacts of industry restructuring, specifically job losses and the effectiveness of governmental efforts to stabilize the sector amid global pressure.
4 Conclusion: This final section synthesizes the findings, suggesting that while the industry faces significant pressure, future focus on the domestic market will likely mitigate the impact of international tariffs.
Keywords
China, Steel Industry, Five-Year Plans, Global Steel Market, Trade Tariffs, Export, Overcapacity, Consolidation, WTO, Economics, Crude Steel, Manufacturing, Sustainability, Trade Policy, Market Demand.
Frequently Asked Questions
What is the primary focus of this work?
The paper explores the current state of the Chinese steel industry, focusing on how international trade tariffs and structural domestic issues affect its global competitiveness.
What are the core thematic areas?
The research covers historical development, global trade statistics, the impact of falling steel prices, the role of governmental Five-Year Plans, and the implementation of protectionist tariffs.
What is the central research question?
The study asks: What are the consequences of steel tariffs on the Chinese steel industry and its development?
Which methodology is applied?
The coursework utilizes a descriptive and analytical approach, examining economic statistics, historical context, and current industry reports to evaluate market dynamics.
What does the main body address?
The main body examines the evolution of China's steel sector, including capacity issues, export dependencies, and the political responses of both the Chinese government and international trading partners.
Which keywords best describe the paper?
Key terms include China, Steel Industry, Five-Year Plans, Global Market, Trade Tariffs, Export, Overcapacity, and Consolidation.
How have Five-Year Plans influenced the steel industry?
They have driven structural changes, moving the economy toward consumption and mandating the consolidation of inefficient, smaller steel mills into larger, more technologically advanced groups.
What is the role of the U.S. and EU tariffs mentioned?
These tariffs act as protectionist measures against what is perceived as unfairly cheap Chinese steel, impacting the profitability of Chinese exporters and pushing them to seek alternative strategies.
How does China aim to deal with industrial overcapacity?
The government utilizes strategies such as mergers and acquisitions (M&As), shutting down low-performing facilities, and reorienting industry focus toward domestic demand and high-class products.
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- Florian Beyer (Autor:in), 2016, Explaining Growth in China, München, GRIN Verlag, https://www.grin.com/document/536582
