February 14, 2008

Ministry of Civil Affairs, Ministry of Commerce and Ministry of Finance

Since the freezing rain and snow disaster struck in the mid January, commerce authorities at all levels have taken various concrete and effective disaster-relief measures to ensure market supply during the Spring Festival across the country, especially in those disaster-hit areas.

First, strengthening leadership

MOFCOM established a Leading Working Group on Disaster Relief headed by Minister Chen Deming, which consists of eight sub-working groups with a daily meeting and 24-hour duty system. MOFCOM has also issued seven documents including the Urgent Notice on Addressing the Freezing Rainy and Snowy Weather and Ensuring Market Supply, and convened a videophone conference on disaster rescue and market supply. Minister Chen Deming and six other ministerial leaders led teams to Hubei, Guizhou, Guangdong, Jiangxi and Hebei respectively to check and guide local market supply work. Local commerce authorities have been actively engaged in disaster-relief commanding with intensified coordinating efforts. The Department of Commerce of Guizhou Province established an emergency commanding center to fight against the icy weather and ensure the normal life of the local residents. The province also runs a 24-hour duty system and requires commerce authorities at the provincial and municipal levels to hold scheduled meetings on disaster reduction twice a day. Both Jiangxi and Hubei provinces have set up emergency leading working groups on market supply and commanding centers on combating snow disaster, with an accountability system put into place. Wuhan City prepared three emergency programs to tackle the declining stockpile and inadequate supply of vegetables.

Second, ensuring a smooth connection between production and marketing

In order to guarantee vegetable and fruit supply in disaster-stricken areas and major cities, with the support of the Ministry of Finance, MOFCOM has organized the transferring of vegetables from south to north, from north to south and from west to east. On February 2, a match-up conference for vegetable and fruit producers and buyers was convened in Hainan with an aim to address the disaster and guarantee the supply of vegetables and fruits. At the conference, contracts on purchase of 580,000 tons of vegetables and fruits were signed. By February 7, 118,000 tons of vegetables and fruits produced in Hainan had been transported to regions in the north on an accumulative basis, which included 45,000 tons of vegetables and 73,000 tons of fruits. On February 5, MOFCOM and the Ministry of Finance jointly issued the Urgent Notice on Ensuring the Smooth Connection between Production and Marketing of Vegetables and Fruits to reinforce the supply from non-disaster-stricken areas to meet the demand in those hard-hit areas. The first batch of 400,000 tons of potatoes, onions and white radishes will soon be transported to Jiangsu, Anhui and Jiangxi. In order to enable vegetables to flow into the plagued areas, MOFCOM and the Ministry of Finance jointly identified items entitled to production-marketing-connection subsidies and formulated relevant standards. MOFCOM also built up a communication mechanism with NDRC, the Ministry of Railways, the Ministry of Communications and the Ministry of Finance to comprehensively arrange the country's transportation capacity.

In order to resolve the difficulty in selling Jiangxi's navel oranges, MOFCOM released relevant information on its the New Countryside Commerce website and Commerce Information Forecast website to establish a matchmaking platform, designated special staff to mediate, and mobilized local wholesale markets, fruit dealers and large retailers nationwide to make the purchase. By February 11, 17,300 tons of navel oranges had been sold and the marketing difficulty has been eased to some extent.

Third, transporting and allocating emergency disaster relief commodities

At the request of the Ministry of Civil Affairs and the disaster-hit areas, MOFCOM organized the emergency transportation of candles, flashlights, mineral water, biscuits, and emergency lights with the help of its emergency commodities database. By February 7, the Ministry had dispatched 15 flights with the coordination of the Civil Aviation Administration and the Emergency Office of PLA's General Staff Headquarters, carrying 10 million candles, lighting equipments, edible oil and instant noodles to the plagued areas. Specifically speaking, 4.4 million candles, 5,500 flashlights, 18,720 batteries and 2,000 boxes of edible oil were transported to Guizhou, 500,000 candles and 2,500 boxes of edible oil to Hubei, 2 million candles, 2,500 boxes of edible oil, 100,000 portions of instant noodles and 6,000 boxes of potable water to Hunan, 2,500 boxes of edible oil to Anhui, 1 million candles to Jiangxi, 2 million candles to Fujian and 500 boxes of edible oil to Guangxi. Poly Technologies Inc. was also mobilized to organize the emergency dispatch of solar energy flashlights and hurricane lamps to Chenzhou of Hunan Province by way of post-express.

Local commerce authorities also actively coordinated the emergency distribution. From January 27 to February 3, Guangdong mobilized 25 trucks, which carried 167,000 packets of biscuits, 143,000 bowls of instant noodles, 67,000 packets of bread and more than 110,000 bottles of mineral water to hard-hit areas. Chongqing managed to get 944 tons of cold fresh meat from other provinces. Vehicles carrying vegetables were granted green licenses in Xianning of Hubei Province and subsidized 100 yuan per day along with free snow chains. Gansu also subsidized operators carrying out emergency distribution for freight.

Fourth, guaranteeing stable food supply to Hong Kong and Macao

Before the Spring Festival, MOFCOM planned carefully together with relevant provinces, areas and departments to actively ensure stable food supply to Hong Kong and Macao during the holiday by implementing the six measures as follows: 1. Utilizing emergency mechanism and the coordination mechanism between Guangdong, Hong Kong and Macao; 2. Strengthening the dynamic monitoring and information disclosure of food supply and demand in Hong Kong and Macao; 3. Increasing the supply of adjacent provinces and areas; 4. Guiding relevant agents and enterprises to increase their output and transportation and accelerate their inventory turnover; 5. Adopting express inspection application and customs clearance services; 6. Arranging adequate quotas.

During the Spring Festival, mainland supply to Hong Kong and Macao of live livestock, poultry, grains, oil, meat, eggs, milk, fruits and vegetables was adequate in source and stable in quality, effectively meeting the needs of the Hong Kong and Macao markets.

Fifth, releasing reserve commodities

From January 21 to February 5, MOFCOM released more than 6,000 tons of central reserve live pigs in 30 large and medium-sized cities. From January 21 to February 1, above 17,000 tons of national reserve of frozen pork were released into the market through bidding. Since February 5, another 1,250 tons of national reserve of live pigs were urgently released to severely afflicted areas including Guizhou, Anhui and Jiangsu. To ensure post-holiday vegetable supply, MOFCOM cooperated with the Ministry of Finance in formulating a plan on the short-term commercial reserve of 100,000 tons of vegetables, which has been implemented already.

Local commerce departments have been actively engaged in the release of reserve commodities. By February 5, Anhui province had distributed 14,100 reserve live pigs to the cities of Hefei, Wuhu, Huainan, Bengbu and Fuyang. Hebei Province allocated 850 tons of reserve pork during the Spring Festival. Wuhan increased the reserve of pork by 2,750 tons, edible oil by 6,000 tons, eggs by 1.3 million kilograms, fresh fish by 1 million kilograms and vegetables by 4 million kilograms, to add to the market supply when needed.

Sixth, intensifying market monitoring

Information on market price and sales of daily necessities in large and medium-sized cities as well as the disaster-hit areas are monitored through the urban and rural market information service system on a daily basis. Commerce authorities at all levels have implemented the daily compulsory report system, and have sent workgroups to the front line to carry out targeted investigations and get hold of the information on market supply and demand in the stricken areas. MOFCOM has opened a special column on the disaster-hit areas in the Commerce Information Forecast website, and has released production and marketing information in the New Countryside Commerce website. By February 8, 105 pieces of information on vegetable supply and 70 pieces on vegetable demand had been publicized.

Seventh, standardizing market order

MOFCOM issued an urgent notice, requiring the local authorities to strengthen disaster fighting and relief as well as market order rectification during the holiday to combat activities like hoarding and speculation, forcing up the prices, producing and selling counterfeit or shoddy products, and commercial fraud, to bolster up supervision over the circulation of disaster-reducing goods and daily necessities, aiming at preventing the substandard products from entering into the afflicted areas. Commerce authorities at all levels have carried out the program of "retrospection" on the pork quality campaign to strike hard against unauthorized slaughtering of pigs. Commerce departments at all levels in Liaoning province have further strengthened monitoring over the 6,000 designated live pig slaughters, to consolidate the achievements made in the pork quality and safety campaign, which targets two 100 percent and one 95 percent.

Facing the unexpected disaster, the commerce authorities nationwide have stood up to the test, accomplished the urgent supply tasks, and ensured the smooth and orderly market operation in the country. First, no goods have run out of stock. Grain, oil, poultry, eggs, fish and milk are complete in variety and adequate in supply, and no big fluctuation has occurred in the market. The supply of meat and vegetables has declined a little, with some places suffering from undersupply and lack of variety, but the general supply has been kept stable. Second, the prices have been basically kept stable. In some regions, the prices of some products increased markedly during a short term, but the margin and duration are generally bearable, and the prices have now almost returned to normal thanks to the efforts of various parties. Third, the normal market order has been ensured. Without any serious cases of hoarding and speculation, forcing up the prices, producing and selling counterfeit or shoddy products, or commercial fraud, the country's food security situation remains basically stable.

(China Development Gateway February 14, 2008)