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The pricing director of China’s National Development and Reform Commission, Cao Changqing, said in a Jan. 17 webcast that new price curbs imposed on food producers and sellers will not impact the country’s market-based pricing system.
Cao’s comment came two days after the government issued an edict saying large wholesalers must seek central government approval if they want to raise prices by as much as 6 percent within the space of 10 days, or by as much as 10 percent within a month. Medium or smaller firms need only seek local government approval.
Beijing, facing increasing pressure to bring down inflation, has responded by capping food prices and increasing the penalties on violators. Moreover, a lawmaker in Guangdong province has just proposed that the local government issue food coupons to help low-income citizens cope with soaring prices. These are the first signs that China is moving back toward consolidating central control over prices.
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