Tariff system seen as tonic for problems with supply

Korea plans to actively use its tariff quota system to cope with supply-side instability that can fuel inflationary pressure in 2012, the Minister of Strategy and Finance said yesterday.

In a meeting with economic policy makers, Minister Bahk Jae-wan said Seoul plans to use the flexible tariffs to stabilize prices of products that may experience supply shortfalls.

“There may be supply problems with products such as rice, dried chili peppers, garlic and pork in the coming months, and this could affect consumer prices,” he said.

The country granted preferential tariffs on 116 products this year to deal with a fall in local farm and meat products caused by bad weather and an outbreak of foot-and-mouth disease. The government expects consumer prices to rise 3.2 percent next year, compared to its forecast of 4 percent for 2011.