China and the EU will form a joint working group to monitor China's steel export volume and to solve the country's overcapacity issue, announced Jean-Claude Juncker, president of the European Commission, at a press conference on Wednesday.

This decision was made by Chinese Premier Li Keqiang together with the president of the European Council, Donald Tusk. Li and Tusk formalized the agreement at a small meeting held before the 11th EU-China Business Summit on July 13.

Juncker expressed his hope to Premier Li that the EU could gain access to clearer figures about China's steel exports. "According to China's official statistics, the export volume increased by 28 percent in the first quarter of the year, but the price decreased by 31 percent," Juncker explained during the press conference.

Juncker said the new working group will monitor the export volume of steel in order to evaluate whether China is taking effective measures to control its overcapacity.

Speaking at the 11th EU-China Business Summit, Premier Li said that although China faces a big challenge from the overcapacity, nearly 90 percent of the country's steel is used for urbanization and infrastructure purposes in central and western China. He also said that China imposes a 20 percent tarrif on steel.

At a press conference in May, China's Foreign Ministry spokesperson Hua Chunying said that only 7.6 percent of China’s exported steel goes to Europe, and only 14 percent of the EU’s imported steel comes from China. It therefore makes no sense to blame the malaise of Europe's steel industry on China, Hua added.

Juncker said that he has discussed China's economic position with various Chinese leaders, and that he hopes the European Council will be able to deliver a final decision after the scheduled discussion on July 20.