Development chief: Consumer price inflation to be structural

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Source: CCTV.com | 03-06-2008 13:55

Minister of the National Development and Reform Commission, Ma Kai says current rising prices in China are the result of structural inflation. And they are not evident of general and protracted price increases. He made the remarks at a joint press conference held earlier Thursday on the sidelines of the ongoing NPC session.

Minister of China''s top economic planning body, Ma Kai, says current increasing price rises are stemming from structural inflation rather than any broader pressure.

Consumer price inflation is considered one of the most prominent threats to China's economy at present.

And the Minister of China's top economic planning body, Ma Kai, says current increasing price rises are stemming from structural inflation rather than any broader pressure.

Ma Kai said, "I think the current price hikes are structural inflation -- which are mainly caused by price rises in agricultural products. That's different from evident inflation... which results from price rises that are more general and sustaining."

Ma Kai says this round of inflation is mainly a result of food price increases. He says production costs and prices of energy and resources are also contributing to rising prices. An excessive liquidity surplus is a also major factor.

Central Bank Governer Zhou Xiaochuan says the key for monetary policy is to tighten liquidity to an appropriate degree.

Zhou Xiaochuan, Governor of People's Bank of China, said, "Excessive liquidity and over investment will exist for a fairly long time in the economy. We need to adjust it over and over again. But we need to maintain an appropriate balance to ensure the stable and healthy growth of the economy."

Consumer price inflation hit a decade high of 7.1 percent in January. But Premier Wen Jiabao's government work report has set a target for the inflation rate -- for the whole year -- of 4.8 percent.

Editor:Zhang Ning