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More Price Restrictions Lifted by China
At a press conference sponsored by the State Council Information Office on July 11, Wang Yang, vice-minister of the State Development Planning Commission (SDPC), introduced further price reforms.

Prices on many goods and services will be liberalized, including on sugar, plastic wrap used in agriculture, natural rubber and coal for power generation. Only 13 products or services, mainly critical services like water and mail, remain under state price control, Wang announced.

After this round of liberalization, the prices of over 90 percent of social retail products, agricultural products and capital goods are regulated by market forces, Wang said.

“It is an important step toward changing governmental functions and market-oriented price mechanisms as well as toward regulating governmental pricing activities in accordance with international economic practices in relation to joining the WTO,” said Wang.

Approved by the State Council on July 4, the State Development Planning Commission promulgated the Pricing Category of State Development Planning Commission and Related Agencies of the State Council – which marks a change in government’s approach to pricing management. Most prices will no longer be under government control but will rather be determined by the producers themselves.

Local pricing authorities should monitor commodity and service prices, but the commission stressed that governmental agencies and local governments are not permitted to interfere in the market process.

In the previous planned economy, most commodity prices were set by the government. Since the reform and opening-up policies began in the late 1970s, the pricing of most commodities and services have been gradually decentralized.

(CIIC 07/12/2001)

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