CCTV.com - CNTV English - CCTV News


Homepage > News > Biz >

Govt pledges to erase illegal charges

01-11-2012 09:59 BJT

By Li Woke (China Daily)

BEIJING - Five ministries on Tuesday reiterated a pledge to stabilize commodity prices by cracking down on illegal charges foisted on suppliers.

"Maintaining price stability is an important step of the 2012 economic policies," Peng Sen, deputy chief of the National Development and Reform Commission, told a national teleconference on Tuesday.

"Excessive intermediaries and high costs are major factors pushing up the prices of goods," Peng said.

The five departments, including the Ministry of Commerce and National Development and Reform Commission, previously pledged to stabilize commodity prices in December by issuing a work plan to crack down on illegal charges levied by retailers on suppliers.

"Part of the problem between suppliers and retail giants is caused by market imbalance," the Commerce Ministry said. "As the country has too many suppliers and a limited number of large retailers, the latter have gained tremendous leverage over suppliers."

In 2010, French retail giant Carrefour was involved in several disputes with suppliers, including Master Kong, a Taiwan-based instant noodles supplier, and China National Cereals, Oils and Foodstuffs Corp, after the retailer allegedly refused to lower its high entrance fees and sales commissions.

The disputes started when Kraft Foods, the world's second biggest food and confectionery maker, halted shipments of its Oreo line of products to Chinese retailer Lianhua Supermarket Holdings after talks broke down over profit sharing.

According to management consultant McKinsey, suppliers in China typically pay retailers a "commission" or "rebate" of 10 to 15 percent, but for some retailers, that number is more than 20 percent. And that's not including some form of under-the-table commission.

"So the suppliers have to raise their product prices to offset all the charges demanded by retailers," said a Fujian-based retailer, who declined to be identified.

In July last year, the consumer price index surged to a three-year record high of 6.5 percent, putting pressure on the government to tame inflation.

Editor:Wang Chuhan |Source: China Daily

Hot Videos view more

The celebrations are still continuing as the victorious coach, Joachim Loew, has been honored for his achievement in his hometown of Freiburg.
Germany coach Loew honored in hometown of Freiburg

Chinese men´s national team continued its preparations for next year´s Asian Cup, as they managed a one-all draw against visitors Jordan during a football friendly in Harbin, the capital city of Northeast China´s Heilongjiang Province.
China held to 1-1 draw by Jordan

The defending world champs came into the contest with a perfect 6-and-oh record, but they would be in for a tough first half before opening things up in the second.
USA beat Slovenia 119-76 in quarter-finals

Hot Stories more

UK authorities believe killer of James Foley is a British national

Across the UK the hunt is on for James Foley’s killer, who authorities believe is a British national. As Richard Bestic reports from London, Prime Minister David Cameron cut short his summer break to lead his government’s response.

Israeli war jets renews Gaza strike as truce talks stalled

Three Palestinians were killed and 40 others wounded in the intensive Israeli war jets´ airstrikes on the Gaza city on Tuesday night, shortly before an end of a 24-hour ceasefire in the Gaza Strip,

Missouri police arrest dozens after violent night

As the protests in the town of Ferguson, Missouri turned violent with police facing ´heavy gunfire´ from some ´criminal elements´, cops fired tear gas, stun grenades and arrested 31 demonstrators on Monday night.

Picture in news more

More Video News

Choose TV Program