China is working on countermeasures to protect the country’s steel industry from the proposed Rio-BHP tie-up, said Chen Haiyan, director of the raw material department under the Ministry of Industry and Information Technology. “The alliance between Rio Tinto and BHP Billiton would present great negative impacts on the healthy development of the steel industry in China, the world’s largest iron ore importer,” said Chen at an industry meeting held in Anshan, Liaoning.

Chen Haiyan made the following remarks at the meeting:

1. The proposed tie-up with a strong nature of monopoly would possibly strike a heavy blow to China’s steel industry and stunt the development of domestic mills. Thereby, we would watch it closely and find ways to cope with it.

2. The merger should be conducted under China’s Anti-Monopoly Law.

3. If the tie-up proved to be monopolistic, we have to seek new policies and regulations to allow Chinese companies have a bigger say in iron ore price negotiations.

4. A principle to be followed is the CISA’s status as an exclusive agent on behalf of the domestic steel industry in iron ore price negotiations.

5. Domestic steelmakers should strengthen their interior managements, promote technical advances and updates, launch structural adjustments and energy-saving and emissions reduction drive, as well as enhance the comprehensive utilization rate of resources.

6. China should increase exploration of domestic mines to reduce reliance on imports.