China orders more inflation fighting measures

China on Sunday announced a further series of measures to rein in rising commodity prices as it steps up efforts to combat rapidly rising inflation, state media said Sunday.

The State Council, China's Cabinet, ordered local governments to boost agricultural production, stabilise supplies and reduce prices, the official Xinhua news agency reported, citing a seven-page document.

It also instructed local officials to ensure oil, gas, coal, and power supplies were sufficient and provide temporary subsidies, Xinhua said.

Local authorities were also ordered to coordinate social-security programmes to provide a gradual rise in basic pensions, unemployment insurance and minimum wages.

The new order comes a day after China said it would will increase grain supplies, open up more land for planting vegetables and crack down on hoarding.

The moves come after consumer prices rose at their fastest pace in two years, fuelled by soaring food costs after severe summer flooding and more recent cold snaps hit crop yields.

The nation's consumer price index rose 4.4 percent year-on-year in October, above the official full-year target of three percent and the fastest rate since September 2008.

The agricultural ministry said on Saturday it would increase the area of land available for vegetable crops "to stabilise production and increase vegetable supplies during the winter," Xinhua said.

Officials would also "seriously work" to prevent hoarding of agricultural products and other "speculative practices", the State Administration of Industry and Commerce said on Saturday.

After one of the country's worst years for natural disasters, the government estimates that more than 80 million people will need food relief this winter, Xinhua said last week.

In the first 10 days of November, average wholesale prices of key vegetables such as potatoes and cucumbers in 36 Chinese cities were 62.4 percent higher than a year earlier, official data showed.

High inflation has a history of sparking unrest in China and the nation's stability-obsessed leaders have already taken a range of steps, including hiking interest rates last month for the first time since 2007.

Source: AFP

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