(AFP) – Apr 13, 2011
SHANGHAI — A Chinese industry group on Wednesday urged businesses not to raise prices, and heed Beijing's call to stabilise costs to help tame inflation, a major bugbear for top leaders and consumers.
Companies must not collude to raise prices or reduce supplies, the government-backed All-China Federation of Industry and Commerce said in a statement.
The call came at a Beijing news conference attended by 24 of the groups that the federation represents, including the agricultural, fishery, pharmaceutical, bakery and textile sectors. Most are private firms.
It follows a decision by consumer products firm Unilever to heed a request from Chinese officials not to introduce price hikes.
Companies "must assume social responsibility, shoulder worries of the nation and ease difficulties of its people", the federation said, calling its membership the "biggest beneficiary" of China's economic reforms.
The move is the latest by authorities to control prices amid fears over the potential for rising costs to spark social unrest in China, which has seen inflation accelerate in recent months.
The State Council, or cabinet, on Wednesday renewed a government pledge to "do everything possible to maintain price stability" and "strictly control" speculative investment in the real estate market, according to a statement.
"This is the main task for macroeconomic regulation and control this year," the State Council said following a meeting chaired by Premier Wen Jiabao.
Beijing has introduced a number of measures including interest rate hikes to temper public concern over inflation, which remained stubbornly high at 4.9 percent in February -- above Beijing's 2011 target of four percent.
Consumer inflation for March, which is scheduled to be released on Friday, is expected to reach 5.5 percent and climb in coming months, Shen Jianguang, a Hong Kong-based economist with Mizuho Securities said.
Anglo-Dutch giant Unilever recently decided to "temporarily postpone" price increases planned for April 1 at the request of the National Development and Reform Commission, the nation's economic planner.
Unilever said in a statement it felt "deeply sorry" about Chinese consumers snapping up detergent and other household items in anticipation of possible price increases.
Taiwan's Tingyi Holding Corp, a producer of popular instant noodles and the Master Kong beverage brand, also said it would drop plans to raise prices for its noodles.
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