Thanks to the effort to provide incentives to domestic demand and implementation of a proactive fiscal policy and a stable monetary policy, China's national economy maintained a good momentum of development with rapid growth and low inflation in 2001. The accumulated national general consumer price level rose by 0.7% over 2000, 0.3% higher than the increase of the previous year.

Main features in the price movement in 2001

1. The raise in the general consumer price level was going down, which in rural area bounced back and in urban area kept decreasing. In the first half of the year, the level resumed the rising in 2000, but due to the slowdown of the global economic growth, the falling of the international market demand, and the detained price rises of parts of the commodities and services in the latter part of 2000, it turned to drop, even to a negative increase after September. The respectively monthly increases in the general consumer price level from January to December were 1.2%, 0, 0.8%, 1.6%, 1.7%, 1.4%, 1.5%, 1.0%, -.01%, 0.2%, -0.3% and –0.3%. Meanwhile, due to the price of agricultural products recovering from falling, with partial rises, the rural general consumer price level stopped falling, with a rise of 0.8% over the previous year. The urban general price levels had less increase, the general price level of the 36 medium and large cities increased by 0.7%, 0.6% lower than that of the previous year, and cities with increases were decreased from 23 in 2000 to 19.

2. Regions with increases in the general consumer level also increased, with obvious regional characteristics. Within the 31 provinces (districts, municipalities), 21 were with increases in their general consumer price levels, 8 more than the number in 2000, increased by 68%. 90% of the western regions had price increases, while in 2000, there was only a little increase in Sichuan's general price level. Gansu and Xinjiang were the regions with the most increases in their general price levels reaching 4%, 5.5% higher than that of Hainan Province which decreased the most. Only 50% of the eastern costal regions had increases in the general price levels, less than 1% in the increase. Regarding the regional structure, the 8 regions with net increases in 2000 were all clustered in the western regions. Number of regions with increases in the price levels was the same with the previous year, with only slight different in the specific provinces, with only four provinces (districts, municipalities) as Beijing, Inner Mongolia, Anhui and Shandong keeping increasing.

3. The rise in price of inhabitancy and services remained the predominant factor for the rise in the general consumer price level, but with weakened impact. The increases in the inhabitancy and services of the year were respectively 1.2% and 7%, 3.6% and 7.1% lower than 2000. As the consumption of inhabitancy and services were having more and more weight in inhabitants' expenses, and part of the inhabiting and services price remained at a higher level, the increases in the inhabiting and services price remained the dominant factors driving the increase in the consumer price level. Compared with the previous year, there was 10.4% rise in the house rents, 14.1% in the tuition and kindergarten expenses, 13.4% in the local call charges, 10.7% in the tap water fee, 10.5% in the medical treatment and health care price, 6.1% in the textbooks and reference books price, 5.8% in the city bus transportation price, 5.5% in the monthly phone rent fee, and 4.0% in the cross-city transportation price. It was estimated that the increase in the residency and services brought a 1.5% increase in the general consumer price level, yet still with 0.7% lower than that in 2000.

4. The fall in the food price stopped and kept steady, which played a critical role in keeping the steady and rise in the general consumer price level. The food price turned from the decrease of 2.6% in 2000 to the same with the previous year, among which the crops price once returned from decreasing to increasing, with an average decrease of 11.4% in 2000 to 0.7%, the price of meat, tame birds, and their processed products, and the price of eggs, which were closely related with crops also stopped decreasing and started rising, with respectively a rise of 1.6% and 6.0%, which was a decrease of 1.5% and 15.5% respectively in 2000. The price of edible sugar had a rise of 4.6% over the previous year, while the price of aquatic products returned from a rise of 1.7% in 2000 to a fall of 2.1% and the price of vegetables had a 4.1% less increase over the previous year. As the consumption of food still occupies a relatively big proportion in the overall consumption expense, the price's stopping fall and regaining stable played an critical role in keeping a stable and rising trend of the general price level. It was estimated that the effect of food price on the general consumer price level was changed from a drop of 1.1% to 0%.

5. The price of industrial consumables kept decreasing, the price of productive materials changed from rise to fall and kept at a low level, with an increasing decrease. The prices of tobacco, alcohol with products, of costumes, of household facilities with services, and of transportation and telecommunications had respective decreases of 0.3%, 1.9%, 2.3% and 1%, which altogether brought a fall of some 0.4% in the general consumer price level. The price of medical and health service and personal articles held close to that of 2000, which had an increase of 0.3% in the previous year. Prices of certain consumables among them all had a vast decrease. The prices of household facilities, endurable consumables and mobile phones all had a fall between 1.8% and 31.9%. It was estimated that the fall in the price of consumables dragged a fall of 0.9% in the general consumer price level. Meanwhile, the price of productive materials also changed from a continuous rise in 2000 to a constant fall. The price of productive materials in circulation had a decrease of 9.5% over the previous year, including a fall as much as 6.3% in December. From the perspective of varieties, price of non-ferrous metals had a fall of 9.5%, chemical products 4.2%, petroleum and its products 0.6%, automobiles 2.7%, ferrous metals 0.5%, electromechanical products 2.1%, wood 1%. The manufacturer's price of productive materials had an accumulated decrease of 1.5% in the whole year, with respective monthly increases of 0.7%, 0.8%, 0, 0.4%, 0.1%, -0.2%, -1.3%, -2.2%, -3.5%, -3.7%, -4.5% and –4.8%, changing from rises to enlarging falls.

Links

  Reform on Market Prices、　The Causes of Price Change、　Market Prices of Production Material