The southwestern Chinese city of Kunming, where Wal-Mart Stores Inc. and Carrefour SA have operations, has imposed temporary price ceilings on daily necessities to counter inflation.
Kunming’s government asked five retailers -- three non-Chinese, one Chinese and one based in Hong Kong -- to report any price adjustments and give reasons for the changes two days in advance of making any alterations, the National Development and Reform Commission’s local branch said on its website yesterday.
Besides the five companies, other food, cooking-oil and beverage producers are requested to apply for government approval 10 working days before making price changes, the statement said.
The city government also imposed temporary price ceilings on daily necessities in major parts of the city starting from yesterday to the end of February, according to the statement. Prices of grain, cooking oil, meat, eggs, milk and noodles are to be kept at levels before Nov. 17, the statement said.
The city limited retail prices of vegetables, depending on type, to 40 percent to 100 percent higher than wholesale prices, the statement said.
“The city’s consumer prices in the first 10 months rose 4.4 percent, the highest among China’s 36 large- and medium-size cities,” the Kunming government said in the statement, adding that the new regulations aim at keeping prices stable and promoting a “harmonious” society amid “strengthening inflation expectations.”
China’s State Council, or the cabinet, said price caps on “important daily necessities” and production materials will be used if necessary, according to a statement posted on its website on Nov. 17 after a meeting chaired by Premier Wen Jiabao.
China’s accelerating inflation has sent stocks and commodities sliding on speculation that efforts to curb prices will cool the world’s fastest-growing major economy. The State Council’s announcement came after the Shanghai Composite Index extended to 10 percent its decline on Nov. 17 from an almost seven-month high on Nov. 8.
Officials “will adopt proactive fiscal policies and prudent monetary policies,” the state-run Xinhua News Agency said yesterday after a meeting of the ruling Communist Party’s Politburo. The government had described the monetary stance as “moderately loose” since late 2008.
-- Huang Zhe, Li Yanping in Beijing. With assistance from Sophie Leung in Hong Kong. Editors: John Kohut, Robert Valpuesta.