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Market Decides Commodity, Service Prices in China
The prices of the vast majority of commodities and services in China have been set by market forces during the Ninth Five-Year Plan period (1996-2000), according to a report from the State Development Planning Commission (SDPC).
By the end of 1998, the prices for 94.7 percent of the retail commodities, 83.8 percent of the agricultural products and 86 percent of the means of production had been adjusted in line with market rule.
The SDPC will soon issue a list of commodities with State-set prices, which includes less than 20 varieties of commodities and services. The price monopoly on electric power, oil, medicine and railway transport has already been broken down, official sources said.
China is speeding up the process of issuing price laws and regulations and improving the order of prices and standardizing price behavior, said authorities from the SDPC.
Analysts note that China's expected entry into the World Trade Organization (WTO) will bring more international market mechanisms to the country to push forward its price reform. China promises to lower its tariffs and further open its market after it becomes a member of the WTO.
China succeeded in curbing inflation and ensuing deflation since 1996, basically stabilizing its general price level.
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