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Chongqing recently shifted its focus to production capacity reduction.

The new campaign aims to reduce overcapacity of the steel and coal industries and eliminate the production of fireworks and crackers.

The backdrop of the program was a negative growth of the black metal smelting and coal mining and washing industries, despite Chongqing’s industrial added value growth rate remaining higher than the national figure.

Losses of coal, steel, chemical engineering, nonferrous metals and nonmetallic mineral companies was 4.8 billion yuan ($610 million) from January to May, 54 percent of the total loss of Chongqing’s firms.

The steel industry’s goal is to solve its overproduction problem by 2017 and maintain a stable annual production of eight million tons.

Chongqing will force coal companies to cut their production by half and close 83 percent of related companies. The city will also prevent production by fireworks companies. A special fund will be set up to cope with the companies’ bad debt problems.