BEIJING, Feb. 6 -- China has taken concrete steps to reduce steel overcapacity, China's Ministry of Commerce (MOC) said on Saturday, in response to encouragement from the European Union (EU).

After a string of measures to cut steel overcapacity, China has seen marked progress at considerable costs with the capacity growth having been curbed, the MOC said.

The State Council, China's cabinet, announced on Thursday the country will reduce its steel production capacity by 100 million tonnes to 150 million tonnes over the next five years, after a reduction of more than 90 million tonnes during 2011 to 2015.

"The moves and plan show China's resolution," the MOC said.

The EU has urged China to curb overcapacity as it worries steel imports from China may hurt its domestic interests. It announced it is considering new anti-dumping investigations this month, according to a Rueters report on Friday.

As steel overcapacity is a common problem worldwide and requires joint effort, China is willing to make contributions to the matter through sincere talks with members of the World Trade Organization (WTO), the MOC said.

In addition, the MOC also said WTO members should stop using a "surrogate country system" on China's exports as the practice will lose its legal basis by the end of 2016, according to the agreement signed when China joined the WTO.

Under the "surrogate country system," importers use costs of production in a third country to calculate the normal value of exports from a non-market economy.

However, the system should no longer be adopted to trade with China which has successfully built a market economy after decades of reform and opening up.