Prices rising on import products despite FTAs

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Prices rising on import products despite FTAs

Since a free trade agreement between Korea and the United States took effect in 2012, the import price of cherries has dropped by 19 percent. But ironically, the retail price of cherries has surged by 42.4 percent over the same period.
And cherries are only one of many items that have become increasingly expensive locally, according to Consumers Korea, a non-profit consumer watch group.
The organization released a report on Monday detailing the costs of 42 food and beverage items ranging from beef to beer and coffee when compared to 13 other major cities worldwide, including New York, Shanghai, Tokyo, Paris and London. The group conducted the survey in two parts this year, from June 20 to 30 and Oct. 20 to 31.
The cost of American cherries in Korea was the fourth highest among the 13 countries.
The consumer group said that a complex retail structure in Korea has caused prices to rise.
In Korea, some products were more costly than in all 12 other countries, including a tall Americano at Starbucks. It costs 4,100 won ($3.70) locally, and 2,477 won in New York.
In July, the coffee chain upped its prices in Korea by 200 won on 22 products including Americanos and lattes despite the declining price of coffee beans. After the move, local coffee franchises such as Hollys Coffee, Café Bene and Ediya also raised their prices.
Consumers Korea said that the domestic price of a Starbucks Americano has increased by 46.4 percent or 1,300 won, since 2007.
“Korea’s importing of coffee beans and coffee consumption has steadily increased,” the organization said in a statement. “But the retail price of coffee only keeps increasing.”
Of the 13 countries, Korea also had the most expensive green grapes, cheese from French producer Kiri, and Chilean wine.
Imported fruit comes with especially high price tags. The group tracked nine imported fruit such as oranges, mangos, kiwis and pineapple and Korea was within the top five countries for all items.
Pineapples from the Philippines and grapefruit and lemons from the United States were the second highest priced.
Consumers Korea called on the government to reduce the cost of goods that are subject to lower tariffs due to free trade pacts.
“Many expected the FTA to bring down the costs and lessen the burden on consumers,” the report said. “But it didn’t necessarily translate into a cheaper retail price for consumers. The government should look into the retail and distribution system to improve the situation.”
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