Small and medium-sized shipbuilding companies are also struggling for survival. Pan Xuejian, president of a shipbuilding company in Taizhou City, says his company, with a capacity of building 10 ships, just received one order for one ship and other shipbuilding companies in Taizhou, have stopped production.

　　"I have never seen such a fast expansion of shipbuilding as I have in the past two decades. Many companies in Fujian Province, areas along the Yangtze River in Jiangsu and Zhejiang provinces, and even the coasts of Shandong and Guangdong provinces rushed to build ships," he said.

　　According to Shen Shilong, commissioner of Taizhou Customs, the export of ships from Taizhou rose 26 times to 520 million USD from 2006 to 2011.

　　The photovoltaic sector, which once promised to be a lucrative new industry, also fell into the predicament of overcapacity.

　　According to the local authority in Kaihua County, 31 out of 41 photovoltaic enterprises have shut down production.

　　In the first "photovoltaic industry base" of Zhejiang Province, which is situated in Quzhou City, all photovoltaic enterprises are distressed due to low prices and a sluggish market. Many have closed down, and a few that maintain production do not run at full production capacity.

　　The guideline says China will also slash the number of firms in the rare earth business through mergers and concentrate production capacity in the sector into a number of large enterprises.

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