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Can overcapacity be avoided by foresight?

By Li Yiping | China Daily | Updated: 2016-12-20 07:15

The task of reducing overcapacity, one of the five major goals of supply-side structural reform, will continue to face challenges next year. Since reducing overcapacity relates to structural adjustment, which is a long-term process, overcapacity can hardly be reduced in one stroke.

Making the matter more complex is the fact that industries involved in reducing overcapacity are pillar industries that played a key role in China's rapid economic growth.

So overcapacity reduction and solving the problems resulting from overcapacity demand special attention. Overcapacity can be reduced in a short time by administrative measures, but the reasons behind overcapacity cannot be eliminated overnight. They could again create overcapacity in some industries, leading to similar economic problems in the future.

Can overcapacity be avoided by foresight?

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