Beijing vows to rein in excessive competition and production as cheap Chinese goods stoke deflation at home and trade friction abroad. The policy shift is necessary to protect China’s key industries and improve optics with its global partners but it will be painful.
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CONTEXT NEWS
China’s top leaders pledged on July 1 to step up regulation of aggressive price-cutting by Chinese companies. “Businesses should be guided to improve product quality and support the orderly phasing out of outdated production capacity,” Xinhua quoted a meeting of the Central Financial and Economic Affairs Commission as saying. The commission is a top economic policy body chaired by President Xi Jinping.
Chinese electric vehicle maker BYD has cancelled night shifts and reduced output by at least a third of the capacity at some of its factories, Reuters reported on June 25, citing two people with knowledge of the matter.
