In 1988 a government-mandated hike in commodity prices proved so calamitous that there was a run on the banks. By that standard, this week’s decision to raise the prices paid by motorists at the pump was met with relative calm. According to FTChinese.com the nation’s drivers now pay $3 a gallon to fill up their cars, overtaking the Americans (who pay around $2.66 a gallon). This represents a 10% price hike, following an 18% rise last year. The winners? Chinese refiners will make more profit. And car makers. As consumers realise that the era of subsidised petrol prices is ending more will go out and buy fuel-efficient cars.
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