[EDITORIALS]Wanted: rational rice policy

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[EDITORIALS]Wanted: rational rice policy

The Ministry of Agriculture and Forestry decided to freeze the state-subsidized rice purchase price at this year's level in 2002. That runs counter to its own years-long policy of gradually lowering the price ahead of World Trade Organization negotiations for opening up the domestic rice market to imports. The policy of cutting the rice purchase price is not popular among farmers, but if the administration fails to correct its decision, it will cause even more problems for farmers in the future.

The best possible option to brace for the opening of the local market for staple grains is to make farms more efficient and lower the domestic price of grain closer to world levels. Unfortunately, Korea has given up on competitiveness, walking a path exactly opposite to that which Japan has taken. Japan has continued to lower its state-subsidized rice purchase price since the 1990s, and the country's current rice prices are now lower than they were in 1990. By contrast, Korea has raised its purchase price by 4 to 7 percent in most years and froze it a few times. Now, Korea's rice price is more than double the level of a decade ago, and domestic rice is 5.8 times more expensive than the American grain. The local rice price is 6.1 times higher than that of Chinese rice and 9.1 times more costly than the rice that the Thai produce. If we have to change to tariffs to protect our domestic farmers, we are in trouble, because WTO rules limit tariffs to 400 percent.

Refusing to lower the purchase price makes a mockery of any policy of increasing competitiveness, and our irresponsible politicians will probably refuse to approve a rice plan without price hikes. Last year, lawmakers forced the government to increase its 4-percent price hike by an additional percentage point.

Next year's rice purchase price must be readjusted in order to increase the competitiveness of domestic rice. The government should raise the basic subsidy payment to rice farmers instead, and expand the scope of a subsidy that pays farmers to keep rice paddies idle.

Politicians should let agriculture authorities decide on the rice purchase price rather than letting politics outweigh common sense.
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