August 26, 2009

Beijing Pops Bubbles

Concerned about overcapacity and overinvestment in certain sectors, Beijing has put the following industries on notice: steel, cement, plate glass, coal chemical, poly silicon (the key component in solar panels), and wind power. All will be "guided" by relevant government departments in the following areas: market access (share issues & loans), land use (access and sales), and environmental supervision (pollution control). Lately, overcapacity in the solar sector has been an issue globally with excess supply bringing down prices. Look for greater consolidation in these industries and with luck the grooming of major potential Chinese multinational corporations.....

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