beyondbrics

The distance from Tokyo to Beijing is 2,000 kilometres but that doesn’t seem to be stopping the Chinese capital’s residents from panicking about the Japanese nuclear disaster – and buying salt.

China’s economic agency told shoppers on Thursday to stop clearing the supermarket shelves of  salt, in the mistaken belief that the minute amounts of iodine in it can stop radiation sickness.

Reuters reports from Beijing:

The Chinese government has repeatedly said the country’s residents will not be exposed to radiation from a nuclear plant in northeastern Japan which engineers are frantically trying to bring under control after it was damaged by last Friday’s earthquake and tsunami.

But in a sign of increasing public worries about the risks,  people across much of China have been buying large amounts of iodised salt, emptying markets of the usually cheap and plentiful product.

The National Development and Reform Commission (NDRC), the country’s economic policy agency, said price regulators could investigate and punish price gouging.     “In recent days, some areas have been affected by rumours that have sparked intensive buying of salt, and some lawless merchants have leapt at the opportunity to raise prices,” said the NDRC in an emailed statement. “Don’t believe rumours, don’t spread rumours, and don’t panic buy.”

The Chinese authorities initially tried to shrug off public concerns about its own nuclear programme. But. as the FT has reported, on Wednesday it announced a suspension of its reactor construction programme – the biggest in the world – pending a review.

“Until the [new] nuclear safety plan is approved, we will suspend approvals of new plants including those in the pre-development phase,” China’s State Council said, according to the FT. “We must fully understand the urgency and importance of nuclear safety.”

The decision by the State Council, which did not provide details about how long the safety review would last, reflected widespread fears in China about the crisis at Japan’s Fukushima atomic plant.

The decision hit the stocks of China’s nuclear power equipment makers. As FT Tilt, the FT’s subscription-based emerging markets service, reported “Naturally, investors are spooked: It’s unclear what’s next in store for China’s nuke plans, and whether the government will revise its plan of spending $159bn in the nuclear sector over the next decade.”

Dongfang Electric saw its Hong Kong-listed shares close 8.6 per cent down, taking the drop for the year to date to a whopping 35.7 per cent. Harbin Power Equipment fell 18.2 per cent (35.5 per cent down on the year) and Shanghai Electric Group plunged 12.7 per cent (-31.1 per cent on the year).

The Hang Seng closed 1.8 per cnet down, with the Shanghai Composite not far behind – 1.6 per cent lower.