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China to end two-millennia state monopoly on salt | Canindia News

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China to end two-millennia state monopoly on salt

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CanIndia New Wire Service 0 comments

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Beijing, May 6 (IANS) China is set to end one of the longest monopolies by the state, going back over two millenia, by eliminating government control on price, production and distribution of salt by 2017, sources said on Friday.

The State Council has decided to launch a reform which will put an end to the government monopoly but will not authorise any more companies to produce or sell salt, EFE news reported.

In China, companies engaged in wholesale production or sale of salt must apply for a license from the government to operate and until now, Beijing fixed production quotas, prices and only allowed state-run companies to distribute salt.

The State Council does not intend to approve the entry of new players in the sector although it will stimulate mergers and acquisitions of firms operating presently to allow the inflow of private capital, the sources said.

However, Beijing reserves the right to intervene in prices in case of large fluctuations.

Salt had been under state monopoly since 7th century B.C., including before the unification of the country and earlier attempts by the government to end the monopoly have been met with resistance from within the sector.

–IANS

ksk/vm

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