Published : 2025-03-22

In 1979, the State Council of China decided to formally begin the price system reform from March 22 of that year, which was an important measure in China's economic system reform.

The reform was divided into two phases.

The first phase started from March 1979 to the end of 1983, specifically focusing on adjusting prices, raising the purchase prices of 18 main agricultural products such as grain, oil-bearing crops, and cotton, as well as raising the selling prices of 8 main sideline products including meat and vegetables.

Price adjustments were also made for textiles, and the prices of some important raw materials and fuels were increased.

The second phase began after 1984, with plans to liberalise prices in different forms and to varying degrees. From January 1, 1984, the new policy of pricing based on quality and grading was trialled first for mechanical products, while a "dual track system" was implemented for the prices of production materials.

In 1985, China widely liberalised the prices of agricultural by-products and appropriately raised the prices of short-distance railway tickets and freight charges.

Subsequently, from late August 1986, prices for seven types of industrial consumer goods, including bicycles, black and white televisions, and refrigerators, were gradually liberalised.

In November, prices for 749 small items in 24 categories, including daily necessities, were liberalised.

From the second half of 1987, the prices of department store goods and cultural small items were liberalised.

On September 11, 1987, the State Council issued the "Regulations on Price Management of the People's Republic of China", clearly defining the three existing types of pricing forms: government pricing, government-guided pricing, and market-regulated pricing, while also granting enterprises the right to set prices for some goods.