China 'agrees to tackle steel industry overcapacity', says Javid

The UK Government says China has agreed to tackle its overcapacity of steel production, which is being blamed for the crisis in the industry.

Business Secretary Sajid Javid described today's crisis talks in Brussels as "constructive".

Tata Steel announced in March that it was putting its UK assets up for sale after prices were hit by China "dumping" steel on the global market.

As a result, thousands of jobs at sites including Port Talbot are in jeopardy, with thousands more in the supply chain at risk.

The company has now appointed a chief executive for its UK steel business as efforts continue to find a buyer.

Bimlendra Jha, an executive member of Tata Steel Europe, takes the new post at a critical time.

He is executive chairman of Tata's Long Products business, including the huge plant in Scunthorpe, which was sold last week to Greybull Capital.

Tata revealed it had contacted 190 potential financial and industrial investors worldwide since launching its sale process a week ago.

Mr Javid said of China's involvement in the talks: "They have absolutely recognised that it is a problem of overcapacity in their country. They're committing to do something about it and I think that's a very positive step forward."

Over-production was the main issue to tackle, said the minister, adding: "I don't think anyone expects an overnight solution to that. The discussion today with all these countries coming together is something that we pushed for, and ... China's participation will help make the difference.

"With regards to Tata, the sales process - the formal process - has now begun, we're starting to be approached by interested parties. It's too early to say much about them at this stage but the important thing is, as we said all along, we will do everything we can to help with that sales process. The steel workers of Britain deserve nothing less."

Koushik Chatterjee, group executive director of Tata Steel, said: "Today's announcement by Tata Steel Europe will ensure the full focus on the vital tasks that lie ahead of Tata Steel UK.

"Bimlendra's successful experience of the process of divestment of Long Products Europe will be invaluable as Tata Steel Europe explores strategic alternatives for its operations in the UK.

"He will be supported by a team with immense operating experience of the UK business.

"To deliver greater clarity for all key stakeholders such as employees, customers and suppliers, it is important for the new team to seek all credible options in a time-bound manner."

Tata also announced the appointment of Standard Chartered Bank as an additional adviser to its sale process.