Consumer prices in China are expected to grow by 4 percent this
year, the highest annual increase since 1997.
According to a report released on Monday by the National
Development and Reform Commission, the price jump had begun to slow
down in October and should continue to fall in the fourth
quarter.
The latter trend is the result of stable prices for foodstuffs,
meat, egg and milk, the commission said.
Both the possibility of higher average prices for wheat, corn
and paddy and that of a price slump are slim.
Meanwhile, the supply and demand for most commodities remains
unchanged.
According to a survey of 600 major commodities, conducted by the
Ministry of Commerce in
the second half of this year, all of them could meet current
demand.
Given current fierce competition in the market and technological
advances, the prices of major commodities should tend to
decline.
In addition, the impact of last year's price hikes is vanishing.
The price hike last year mainly occurred in the fourth quarter and
it very much affected prices in the first three quarters of this
year.
With its influence fading, the fourth quarter should see clear
fall in the growth rate of prices in comparison?with the first
three quarters, reported The Business Times.
But the commission also pointed out that there are still
problems in some areas.
A major one is the continued disparity between the supply and
demand of coal, power, oil and transport, putting upward pressure
on prices.
The other problem is that high energy and raw material prices
will push up prices of other products.
"Price hikes this year have made life more expensive," said
Beijing resident Liu Jing. "I wish prices would start falling."
"Although the rise in prices of commodities like edible oil and
electricity does not seem too great, it does affect daily life once
you count it carefully because you need such things every day," she
said.
And climbing fuel prices have made Liu and her boyfriend
reluctant to buy a car. "We have to wait and choose one that is
fuel efficient," she said.
According to a report from the China News Service, the
commission will take a series of measures to ease tension in the
supply of coal, power, oil and transport.
According to statistics from the first 10 months of the year,
the price of oil and oil products rose 10.5 percent over the same
period last year, while the price of coal climbed 13.4 percent.
The commission called on departments to boost supplies to meet
demand from important regions, sectors and enterprises.
The price of coal and power will be kept stable and outdated
industries will be limited so that unreasonable demands for coal,
power, oil and transport is lessened.
(China Daily December 8, 2004)