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government noticed that some of the institutional purchases might have been made under the guise of mending the damages
from the floods. Thus it called for tighter control over
institutional spending.
7.
The buoyant
economic activity caused the rate of
inflation to edge up during the third quarter of 1991,
reaching a peak of 4.4% in August. For the first three
quarters as a whole, the overall rate of inflation was
still low, averaging at 2.5%. Thus the target set at the
end of 1990 of keeping the rate of inflation in 1991 below
6% will certainly be achieved. However, the inflationary
pressures were much higher in the cities where the cost of living index rose by an average of 8% in the first three
quarters of 1991. The rate of increase for this index has
been over 10% since June. Recently, the State Council has
announced that the state purchasing price of wheat will be
raised on 1 April 1992. Apart from increasing further the
state purchasing prices of grain and cotton and the state-fixed selling prices of grain and edible oil, the
government is also planning to raise the prices for coal,
oil, electricity, steel, transportation and
telecommunications.
These measures will exert direct
pressures on the cost of living in the cities and on the
Therefore, the rate of inflation in
crude
cost
of production.
1992 will probably be even higher.
(c) External sector
8.
value
of
amounted
to
to China's
According
Customs Statistics, the
total trade in the first three quarters of 1991
US$93 billion, representing an increase of 19%
terms over the same period in 1990. The growth
exports accelerated in the third quarter. The
visible trade surplus in that quarter, at US$2.6 billion,
was the second largest since the first quarter of 1990 when
in money
rate of
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