The BBC is reporting today that the Chinese Government has imposed temporary price controls on :
More at the link.
This is a little unsettling, particularly when the U.S. economy is in the midst of economic troubles of its own occasioned by the mortgage default crisis. James Fallows wrote an interesting piece in the January/February 2008 edition of The Atlantic Monthly on the present interdependent economic relationship between China and the U.S. In it, Fallows describes how Chinese Government policies on economic and social development intended to minimize the potential for major disruptions, coupled to the effects of the decline in value of the U.S. dollar on both the purchases of Chinese manufactures and Chinese investments in U.S. securities, taken together may in effect conspire to bring about a serious economic and subsequently political break between the two countries and serious social and political instability, particularly within China. It's only four pages, and well worth the read: by James Fallows.
Retailers and producers will face heavy fines if they increase the price of basic necessities, the government says.
Food prices climbed more than 18% in November, while the price of pork jumped by more than 50%.
Inflation has traditionally been associated with civil unrest in China, and correspondents say the intervention shows the government is very concerned.
During the past 20 years, the Chinese administration has largely abandoned price controls, as the free market took hold across the country.
The price of basic essentials has increased hugely during this time, and families on low incomes - numbered in their hundreds of millions in China - currently spend between 30% and 50% of their income on food for the table.
More at the link.
This is a little unsettling, particularly when the U.S. economy is in the midst of economic troubles of its own occasioned by the mortgage default crisis. James Fallows wrote an interesting piece in the January/February 2008 edition of The Atlantic Monthly on the present interdependent economic relationship between China and the U.S. In it, Fallows describes how Chinese Government policies on economic and social development intended to minimize the potential for major disruptions, coupled to the effects of the decline in value of the U.S. dollar on both the purchases of Chinese manufactures and Chinese investments in U.S. securities, taken together may in effect conspire to bring about a serious economic and subsequently political break between the two countries and serious social and political instability, particularly within China. It's only four pages, and well worth the read: by James Fallows.