Officials should persuade benefit of rice market opening
Published : 2014-07-04 21:14
Updated : 2014-07-04 21:14
Judging from comments from senior officials, it appears certain that the government has already decided to liberalize the local rice market by replacing the current nontariff, quantitative barrier with tariffication.
An announcement on the decision had been planned at the end of last month, but officials delayed it, apparently to buy the time to win round politicians and farmers opposed to the government policy.
As this page has said, Korea will benefit more from full liberalization of the rice market, which means there would be no nontariff barriers, than extending the current minimum market access import quota system, which is due to end this year.
The waiver for tariffication has already been extended twice, and in return, Korea had to increase the import quota from 50,000 metric tons to more than 400,000 metric tons, which is 9 percent of the local output.
If Korea again extends the waiver at the end of this year, it has to import about 940,000 metric tons next year, which will amount to 20 percent of the rice market. With grain consumption rapidly declining, imports of so much foreign rice would cause a huge burden. The government spent 20 billion won to store imported rice last year alone.
Besides, the rice self-sufficiency rate, which now stands at 89.2 percent, would fall to about 70 percent. This contradicts opponents’ argument that tariffication will pose a greater threat to the nation’s grain self-sufficiency and food security than the current MMA restrictions.
There is no doubt that rice is a sensitive trade item, especially for Asian countries. Farmers’ livelihoods and national food security are at stake, among other things. This is one of the reasons why the government should try to its best to forge a national consensus.
It seems that the government, which is said to plan to finalize its position in the middle of this month, is taking a step in the right direction by planning a public hearing and increasing its contacts with lawmakers, especially from the opposition. At the same time, officials need to work out thorough follow-up measures to minimize the impact on farmers and enhance the competitiveness of the local rice industry.