Li Zhongjuan said that a serious overcapacity will result in the waste of social resources, lower efficiency of allocation, and impede the upgrading of industrial structure. According to a survey conducted by the Bureau of Statistics, in the first half of this year, Chinaâ€™s industrial capacity utilization rate was 78%, which was the lowest since the fourth quarter of 2009. Of the 39 products, 21 had a capacity utilization rate of less than 75%, and photovoltaics, calcium carbide and other products were even less than 60%.
In this regard, Xue Shengwen, senior researcher at China Investment Consulting, explained that the low capacity utilization rate indicates that the maximum utility of the equipment has not been used and resources have been wasted. Too high may indicate the need for capacity expansion and prepare for later development.
He said that the figure of 78% reflects that our resources have not reached the optimal allocation. He believes that since the launch of 4 trillion yuan in 2008, most of the funds have flowed into heavy industries, causing a serious excess of industrial capacity, and the problem of overcapacity in steel, photovoltaic, calcium carbide and other fields is serious.
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