Market News International:

In 2023, low food price inflation contributed to China's overall low level of CPI. For this year, what is the outlook for food price inflation? And what policies will the NDRC pursue to influence food prices? Thank you. 

Jin Xiandong:

Thank you for your questions. In 2023, overall price levels in China remained stable, with an increase of 0.2% in the consumer price index (CPI) for the whole year, which was narrower than the previous year. Looking at the main reasons, in 2022, certain non-economic and non-conventional factors led to a significant increase in international market prices for energy and food. However, in 2023, these prices experienced a noticeable decline, resulting in an overall decrease. In terms of specific categories, firstly, within China's CPI, energy prices, influenced by import factors, changed from an 11.2% increase in 2022 to a 2.6% decrease in 2023. The 2.6% decline in energy prices last year directly contributed to an overall 0.2 percentage point decrease in CPI for the entire year. Secondly, food prices were influenced by import factors, seasonal factors and cyclical factors. They changed from a 2.8% increase in 2022 to a 0.3% decrease in 2023. The 0.3% decrease in food prices last year directly contributed to an overall 0.06 percentage point decrease in CPI for the entire year.

From the perspective of food price changes you mentioned, when examining specific subcategories, we can see that grain and edible oil prices remained relatively stable with a slight increase. Fresh fruit prices increased by 4.9% compared to the previous year. However, pork prices experienced a cyclical decline, with a year-on-year decrease of 13.6%. Fresh vegetable prices also saw a year-on-year decrease of 2.6%. Taking all factors into account, China's agricultural product market has sufficient supply, smooth logistics, well-regulated market order and stable price operations.

Next, together with relevant departments, we will monitor market supply and demand, as well as changes in price trends. We will ensure all links are well managed. This includes overseeing production and supply, coordinating between production and sales, handling imports and exports, and adjusting storage throughput for essential commodities like food. We aim to guarantee ample market supply and stable prices. We anticipate that, with the gradual reduction of base and cyclical effects, the steady recovery of market demand, and the continuous effectiveness of policies benefiting farmers, there is a foundation for the stable operation of food prices. Thank you.

Xinhua News Agency: 

According to the Central Economic Work Conference, the consistency of macroeconomic policy orientation should be enhanced. As the department responsible for macroeconomic regulation and comprehensive economic work, what plans does the NDRC have for the year 2024 in this regard? How will it ensure that policies in various fields converge and form a concerted effort? Thank you.

Yuan Da: 

Thank you for your questions. Assessing the consistency of macroeconomic policy orientation is a significant innovation in macroeconomic regulation and an important means to strengthen policy coordination. I will briefly introduce the relevant work in this aspect.

In accordance with the decisions and arrangements of the Party Central Committee and the State Council, in 2022, the NDRC took the lead in establishing a policy document assessment mechanism. This mechanism involved assessments of the consistency of newly introduced policies with macroeconomic policy orientation. When issuing documents related to macroeconomic stability and market expectation stability, all departments under the State Council must submit them to the NDRC for a consistency assessment. The main elements of this assessment include whether the policy documents align with the guiding principles of the Party Central Committee, whether they might have a contractionary or inhibitory impact on the economy, and whether they might adversely affect societal expectations. The assessment also provides timely opinions to make policies work together more effectively. Since initiating the assessment work, with the support and cooperation of relevant departments, the synergy of various policies has significantly improved, and their consistency with the macroeconomic policy orientation has continually been enhanced. At the same time, it is necessary to recognize that current societal expectations are relatively weak, highlighting the importance of reinforcing policy coordination. The Central Economic Work Conference has called for enhancing the consistency of macroeconomic policy orientation, incorporating non-economic policies into assessments, and strengthening policy coordination to ensure concerted efforts and synergy.

Next, the NDRC will thoroughly act upon the guiding principles of the Central Economic Work Conference and conduct high-quality assessments for consistency with macroeconomic policy orientation. First, the NDRC aims to enhance the assessment mechanism. Building on a review of the work from the past two years, it will strengthen assessment requirements, define the assessment scope, refine the evaluation process, and assess the impact of policies, including non-economic policies, scientifically and accurately to better serve the overarching goal of high-quality development. Second, the NDRC will comprehensively and prudently assess policy effects. It will rigorously examine the impact of various policies on economic aggregates, structure, supply and demand, industries, regions, employment, and expectations. It will prioritize policies conducive to stabilizing expectations, growth, and employment, while cautiously introducing contractionary or inhibitory measures. Comprehensive and precise analyses of the cumulative effects of a set of policies will be made to further enhance policy coordination and work synergy and to effectively prevent the "composition fallacy." Third, the NDRC will strengthen consistency in the policy implementation process. It will guide relevant departments to assess changes in the situation scientifically, seize the timing of policy formulation, strengthen expectation management, solicit opinions and suggestions, set policy transition periods appropriately, and ensure the seamless linking up and orderly progress of various tasks. In addition, it will enhance the analysis and judgment of potential risks during the policy implementation process, prevent problems such as excessive policy steps and one-size-fits-all approaches, and ensure that the ultimate effect of the policies aligns with the decisions and intentions of the Party Central Committee.

At the same time, the NDRC will continue to enhance economic situation analysis, strengthen economic monitoring, forecasting, and early warning, and conduct preparatory research to maintain policy options for different eventualities. It will deploy a comprehensive set of macroeconomic policies, further enhancing the foresight, scientific nature, and effectiveness of macroeconomic regulation, continuously consolidating and enhancing the positive economic recovery trend. Thank you.