A huge steel plant which is Beijing's worst polluter has pledged to drastically cut production next summer so that the 2008 Olympic Games can enjoy better air quality.

Beijing Shougang Group, one of China's leading steel manufacturers, pledged an output reduction of more than 70 percent from next July to September to ensure the Olympics can enjoy better air quality.

The steel company, built in 1919 and located 17 kilometers west of the Tian'anmen Square, has been the worst polluter in Beijing for years.

"During July, August and September next year, the group will cut its production to less than 30 percent of its normal capacity to help the Beijing government fulfil its commitments to improving air quality for the Olympics," said the group's president Zhu Jimin Monday.

According to the requirement of the State Council, or the country's cabinet, Shougang will reduce the annual output of 8 million tons at the Beijing plant to 4 million tons at the end of this year. The target output for 2008 is set to be 4.2 million tons.

"This is also what we want to contribute to society and the world," said Zhu.

During the third quarter next year, the group will maintain the monthly output at 200,000 tons, 30 percent of its normal capacity.

In those three months, the company will carry out the minimum amount of production necessary to ensure that the plant and machinery can continue to function.

It has made specific plans for emission control. In 2008, the emissions of soot, dust and sulfur dioxide will be reduced by 50.32 percent, 49.22 percent and 49.18 percent respectively.

"The production is basically suspended during that period, which brings about great economic losses to the group," said Zhu. "But the government may do something to make up for it, such as refunding taxes."

The State Council has promised that all the taxes collected from 2006 to 2009, totaling 3.8 billion yuan (US$507 million), will be refunded.

As one of the efforts made by the Chinese government to improve air quality, the steel company began in 2005 to relocate its facilities to a tiny island in Hebei Province, some 200 kilometers east of Beijing. The new plant will be completed in 2010.

Beijing's environment watchdog says with Shougang's production facilities gone, city residents will inhale 18,000 tons less particulate matter a year, equivalent to the total emissions of about 100 average-sized manufacturing enterprises.

Shougang produced 12.48 million tons of steel last year, earning it a revenue of 87.47 billion yuan (US$11.6 billion).

The group has invested 2.1 billion yuan (about US$280 million) in environmental protection since 1995. The emissions of sulfur dioxide, soot and dust had been reduced by 78 percent, 82 percent and 84 percent in 2006 respectively, compared to those of 1995.