China announces control guidelines to avoid price rises

[News_Editor]

China announces control guidelines to avoid price rises

2010-11-18 01:47:25 GMT+7 (ICT)

BEIJING, CHINA (BNO NEWS) -- China on Wednesday announced control guidelines on prices to aid consumers facing rising inflation which rose food prices by 10.1 percent in October, the state-run Xinhua news agency reported.

The price control guidelines were announced by China's State Council and are part of the efforts to ensure market supplies, improve subsidy systems, make price controls more targeted and strengthen market supervision.

The council also urged local authorities to offer temporary subsidies to the most vulnerable families. The government should also increase allowances for students and student canteens. Social welfare benefits should be aligned with price levels and basic standards of social welfare should be gradually raised.

China will also support agricultural production in order to maintain steady growth of agricultural output and put state reserves of grains, edible oils and sugar on the market when needed to guarantee supplies.

Authorities should also keep a close eye on winter vegetable production to increase supplies during winter, take measures to cut delivery costs, and increase cotton transportation from Xinjiang Uygur autonomous region.

The State Council welcomed and urged to continue the reduction of gas, power and rail transport prices for chemical fertilizer producers, ensure coal supplies for power generation companies and increase production of oil and diesel to guarantee sufficient supply.

The adjust of prices would be made promptly and moderately. The natural gas prices should be kept stable and temporary price controls should be imposed on important daily necessities and productions materials when necessary.

China's consumer price index (CPI), a main gauge of inflation, increased to 4.4 percent last October, the highest in 25 months. In southern China’s Guangxi Zhuang autonomous region, the country's largest sugar producing area, witnessed a 74.7 percent increase per ton.

The prices of 18 types of vegetables for last week were slightly lower by 0.8 percent. However, on a year-on-year basis, the vegetable prices were still significantly higher than last year. Last week, pork meat rose 1.6 percent, mutton increased by 0.5 percent, eggs rose 0.9 percent, rice was up 0.6 percent and flour increased by 0.4 percent.

The State Council's announcement regarding price control guidelines came after Chinese equities fell for a second day running Wednesday as investors feared prospects of higher interest rates and inflation control policies would hurt earnings.

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