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Official backs coal price reform

By Yu Tianyu (China Daily)
Updated: 2008-12-04 19:26

Facing a diving coal price recently, it is more appropriate for China to insist market pricing and to let the market decide the country's coal supply, said Wang Shuhe, deputy administrator and chief engineer of the State Administration of Coal Mine Safety, responding to some of local governments which are proposing to reduce coal production for higher price.

Wang said the increasingly deepening financial crisis will produce adverse impacts on Chinese coal enterprises, but he is confident that they will overcome the crisis, because their ability to withstand risks have been largely improved after the 1997 Asian Financial Crisis.

The stimulus packages will bring a positive impact on China's coal demand which would not has very large fluctuations, Wang said.

He suggested coal enterprises take the time to carry out internal reform and update their technology in an effort to boost their competitiveness.

According to statistics, average coal price in China decreased by 30 to 40 percent in November, compared to the price in the middle of the year.