To continue to address overcapacity in a serious and resolute manner, China has made elimination of overcapacity the top priority for this year and will cut the steel industry capacity by another 100-150 million tons.

Second, take the tackling of overcapacity an opportunity to accelerate economic restructuring.

The Chinese word for "crises" is made up of two characters, crisis and opportunity. Guided by ourconventional wisdom that opportunities are embedded in crises and that we must be good at getting to grips with them, China is pushing through essential reforms and restructuring against all odds.

Being fully aware that much of China's industrial overcapacity is heavily concentrated at the lower end of the value curve, we have taken restructuring of the iron and steel sector an important part of our endeavor to complete the difficult transition of moving China away from an investment-led economy to a consumer-oriented one.

China is actively restructuring the steel sector byeliminating outmoded capacity, creating exit strategies for "zombie companies" based on market rules and encouraging promotion of innovation, technology, quality and management to meet production safety, energy consumption and environmental protection standards, ensure effective supply of high quality products.

In addition, we have put in place stricter supervision over local authorities to guard against excess production and tendency to protect enterprises with favorable policies.

Third, support training and relocating workers fornew jobs and businesses to minimize the negative impact of transformation.

Like elsewhere in the world, pressure of globalization and reform and restructuring has its impacts in the Chinese society. Restructuring of the iron and steel sector gives rise to concerns and worries. Yet, there is a common understanding that there is a price and pain to be taken for change for the better.

This time around, the Chinese Government has taken up measures to help redundant labor change career path. Among others, the central government is setting up a special fund to retrain workers and support local government efforts to reduce overcapacity.

And with rebalancing underway in the Chinese economy and with numerous new industries emerging, now it is far easier to get new and better-paid jobs than inthe reform of the country's inefficient state-owned industries in the late 1990s.

This should also mean China can rely more on domestic consumption, instead of pouring yet more concrete in a country that has already built too many steel mills and cement plants.

Fourth, stay the course of transformation against headwind.

Our attitude to life is shaped and moulded by the great intellectual legacy over the past thousands of yearsand values associated with Laotze, Confucius and Motze, including the wisdom that as heaven maintains vigor through movement, a gentleman should constantly strive for self perfection.