The Bank of Korea (BOK) and the Ministry of Agriculture, Food and Rural Affairs in South Korea are engaged in a dispute regarding the reasons behind the inflation of fresh produce prices. A recent report from the BOK attributes the surge in prices of items such as apples and potatoes to factors like low productivity, limited trade openness, and elevated distribution costs, suggesting these elements hinder the country's disinflation efforts and contribute to increased living costs. On the other hand, Agriculture Minister Song Mi-ryung criticizes the BOK's approach for not adequately considering the unique aspects of South Korea's agricultural and trade dynamics.
Choi Byung-ok from the Korea Rural Economic Institute emphasizes the complexity of agricultural policy, pointing out the intertwined nature of safety, quarantine, and the livelihoods of farmers with the sector's policy-making. Choi warns against the simplistic solution of boosting imports, using the example of red pepper farming in Korea to illustrate how such measures can lead to the decline of local farming and ultimately higher prices for consumers.
Source: koreatimes.co.kr