The president of the European Commission, Jean Claude Juncker, said that it was "unacceptable" that the steel industry in Europe has lost many jobs, and that China needs to control its steel overcapacity. He made the remarks at the G20 summit in Hangzhou, China.
Juncker said, "Addressing the challenge of overcapacity in a credible manner will be the test case as the European Commission comes to assess the treatment of China in our anti-dumping and antisubsidy investigations".
The overcapacity of steel makes it harder for European countries to compete with China's low steel prices.
Jack Lew, the US Treasury secretary, has previously said that China's "excess capacity has a distorting and damaging effect on global markets".
However, China has vowed to reduce its steel production.
At a press conference on Friday (2 September) China's finance minister Zhu Guangyao said the country is "is taking a lead in actions against production overcapacity among the global economies. China has also launched the strongest policies to address the problem. We have combined market principles with legal means to reduce excessive capacity".
"China has also launched the strongest policies to address the problem. We have combined market principles with legal means to reduce excessive capacity".
The volume of steel China's production is twice as much as that of the next leading producers, which includes countries such as Japan, US , Russia and others. The influx of cheap steel into the global market has led to other country's steel production industries to struggle. In the UK, Tata Steel announced 1,050 job cuts in March 2016.