China’s steel association and major steelmakers have called for an
increase in domestic iron ore production as well as greater investment
in exploration overseas to ensure supplies.
He
Wenbo, chairman of the China Iron & Steel Association (CISA),
recommended at the Chinese People’s Political Consultative Conference
(CPPCC) in Beijing that China should set a “national strategic goal” of
keeping its domestic iron ore output at more than 20% of total demand.
China
is the world’s top iron ore consumer, with its demand set to hit 1.225
billion tonnes in 2020, according to a government think tank. But it has
a heavy reliance on imports, having shipped in 1 billion tonnes of ore
in 2019.
He, a
delegate at this year’s CPPCC, proposed that revenue from a value-added
tax levied on iron ore imports be channelled into a national iron ore
development support fund to strengthen investment in domestic mines.
These tax revenues amount to around 90 billion yuan ($12.61 billion)
annually.
He
suggested that steel firms investing in new mines or expanding
production at existing deposits should be exempted from income tax.
“(We
should) continue to actively promote joint investment and cooperation
with mainstream miners while also focusing on undeveloped resources in
Africa and Canada,” He said.
The
CISA chairman also urged increased collection and utilisation of steel
scrap, a more environmentally friendly alternative to iron ore in steel
making.
He
Wenbo said relevant parties are working on a national standard for steel
scrap which will allow the material to enter China as a resource instead
of a restricted solid waste.
Separately, Cao Zhiqiang, chairman of Hunan Valin Iron & Steel Group and
a delegate at the National People’s Congress (NPC), proposed expanding
financing channels for special funds used in overseas resource
exploration.
China
should offer favorable tax policies to companies investing overseas to
help them avoid double taxation, state media reported.
Another NPC delegate, Ansteel Group chairman Tan Chengxu, proposed
speeding up formulation of an iron ore resources security strategy and
urged strong support for exploration of domestic ore, according to a
company statement on Monday.
Source: Reuters |