Behind the full liberalization of agricultural prices

After the executive meeting of the State Council proposed to promote price reform on November 15 last year, the contents of the first batch of price reforms were announced. The state has liberalized the prices of 24 goods and services, and price reform has taken another important step in the direction of marketization. The head of the Price Department of the National Development and Reform Commission interpreted the policy background of price liberalization.

Why can the prices of agricultural products be fully liberalized?

According to the notice of the National Development and Reform Commission and the State Tobacco Monopoly Administration, the purchase price of tobacco leaves will be liberalized from 2015. Tobacco enterprises can independently determine the purchase price of tobacco leaves according to the costs and benefits of growing tobacco, the needs of industrial enterprises and the needs of industry development. Previously, the purchase price of tobacco was determined by the competent department in charge of price under the State Council in conjunction with the State Tobacco Monopoly Bureau, which was priced differently according to variety, grade and region.

A person in charge of the Price Department of the National Development and Reform Commission said that the liberalization of the purchase price of tobacco leaves, the last variety set by the government in the field of agricultural products, marks that the prices of agricultural products in China are all formed by the market. Since 1978, the price reform of agricultural products has been continuously promoted and deepened, and we have always adhered to the market orientation. In the process of promoting the reform, we have implemented the combination of regulation and release, gradually increased the weight of "release", and finally achieved full liberalization. Among them, the purchase and sale prices of most agricultural and sideline products were liberalized in 1985, live pigs and pork prices were liberalized in 1992, cotton purchase prices were liberalized in 1999, and grain purchase markets and prices were liberalized in 2004. The liberalization of the prices of agricultural products has promoted the great development and liberation of rural productive forces.

The responsible person said: in liberalizing the prices of agricultural products, China does not mean to "let it go", but to combine market regulation with government regulation while giving full play to the role of the market mechanism, and constantly strengthen and improve the macro-control system of agricultural products prices. For example, the government has implemented a minimum purchase price policy for rice and wheat, a temporary purchase and storage policy for corn and rapeseed, and a pilot reform of target price subsidies for cotton and soybeans. A preliminary plan for the regulation and control of periodic fluctuations in market prices has been established for live pigs, and comprehensive measures such as establishing a reserve system for important agricultural products and increasing financial subsidies have been taken to prevent sharp fluctuations in the prices of major agricultural products and protect the interests of farmers.

What is the purpose of domestic tariff reform for some railways and civil aviation?

With regard to the reform of some railway transport prices, the responsible person said: for a long time, the railway passenger fares and freight prices invested by various main bodies in our country have basically been set by the government. a small number of high-grade trains and other passenger fares, and a few specific line freight prices are subject to government-guided or market-regulated prices; and the charges for railway passenger and freight transport extension services are set by the government. The National Development and Reform Commission has successively issued market-oriented reform measures on railway freight rates in the first half of 2014. This time, the liberalization of four railway transport prices, such as railway bulk freight express prices, and guiding localities to liberalize railway transport extension service charges is another measure to speed up the reform of railway freight rates in accordance with the direction of marketization.

It is understood that the current freight rates and passenger fares of civil aviation domestic routes are managed by the Civil Aviation Administration in conjunction with the National Development and Reform Commission, mainly under government guidance, and market regulation is implemented for short-haul routes within the province and some cross-provincial routes that compete with the mode of ground transport. In recent years, with the rapid development of China's civil aviation transport industry, the internal competition in the civil aviation transport market is becoming increasingly fierce; with the improvement of the operation speed and service quality of other transport modes such as railways and highways, there is also a competitive relationship between civil aviation and other modes of transport. In order to comply with the development and changes of the transport market and accelerate the market-oriented reform of civil aviation freight rates, this price reform has put forward three contents: first, the freight rates of domestic routes should be liberalized in an all-round way. the specific freight level is determined independently by airlines according to production and operating costs, market supply and demand and competition conditions. The second is to improve the pricing method of benchmark fares: the benchmark fares of routes approved by the government will be changed to pricing rules formulated by the government, and the airlines will formulate and adjust the benchmark fares according to the rules, so as to change prior examination and approval into mid-event and post-event supervision; third, further liberalize the passenger fares of short-haul routes below 600 km between 101 neighboring provinces and competing with the main modes of transportation on the ground.

The person in charge of the Price Department of the National Development and Reform Commission believes that liberalizing the freight rates of domestic routes and passenger fares of some short-haul routes and improving the pricing method of benchmark fares are concrete measures to simplify administration and delegate powers, reduce government intervention and promote price reform. it is helpful to guide air transportation to allocate resources rationally, stimulate market vitality and mobilize the enthusiasm of social capital investment. It also helps to promote airlines to continuously improve the level of operation and management, enhance competitiveness, cultivate new transport growth points, and better meet the needs of the society.