NPC: Concerned by rising prices, China pledges to keep CPI growth to 4.8 percent

March 6, 2008 Posted by China Briefing Reading Time: 2 minutes

BEIJING, Mar. 6 – Premier Wen Jiabao pledged to cap China’s consumer price index (CPI) growth rate within 4.8 percent in 2008 – the average level of last year, to ease the country’s mounting pressure of inflation.

The country’s economy will be steered to move at around 8 percent this year, on the basis of “improving the economic structure, productivity, energy efficiency and environmental protection”, Wen said at the opening of the annual legislative session in Beijing on Wednesday morning.”

The current price hikes and increasing inflationary pressures are the biggest concern of the people, Wen said in his address to the National People’s Congress. “One major task for macroeconomic regulation this year is to stem prices from rising rapidly.”

The rising consumer price index is also a major concern for the government, which is seeking to balance the run-away growth of the coastal provinces with the center of the country, which has lagged far behind. The widening gap between the haves and the have-nots has given rise to almost daily protests over local corruption, land seizures and, now, the rising cost of daily necessities.

In an effort to stem prices, the country will boost production of food, edible oil, meat and other necessities, strictly reining in the industrial use of grain and grain exports China Daily reported.

China is planning to follow a prudent fiscal policy in an effort to maintain the country’s economic development and guard against drastic fluctuations that could be destabilizing Wen said.

The two-week session of the legislature is presented as an important occasion for legislators to debate and endorse legislation and national policies, though the more heated arguments and plans have already been made behind closed doors and the session is often more of stage for unveiling new policies.

In the coming week, China is expected to formally introduce the reorganization of many of the agencies of the State Council into three “Super Ministries.” They will be the Ministry of Transportation, Ministry of Energy and Ministry of the Environment and Construction.