Suffocating under rising costs

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Suffocating under rising costs

Grocery shopping has become a frightening task due to increasing food prices. Life is turning more difficult for the working class amid a standstill income and job insecurity as prices of everyday necessities including gas have jumped. According to the Korea Consumer Agency, cabbage and radishes that sold at 1,000 won ($0.84) and 1,200 won each in January 2016 now cost 3,580 won and 2,980 won, respectively.

A 30-pack egg carton sells for over 10,000 won. Prices of other groceries including ice cream, beverages, washing liquid and batteries have gone up by an average of 10 percent over the last year. Gasoline prices have increased an average of 1,500 won across the nation and over 1,600 won in Seoul. Utility bills have also been pushed up. Seoul and Jeju governments raised prices for trash disposal bags, and Gyeonggi and Seoul administrations have upped water supply and sewerage fees. Bus fares commuting between Seoul and Incheon and in Daegu, and public transportation fees in Busan are all ready to go up or have been pushed up. From the cost of living expenses, it does not feel like inflation is still at 1 percent range.

Higher inflation while the economy and income grows is a positive sign. But it is not the case with Korea. According to the Statistics Korea, real household income reflecting inflation has stagnated or fallen since the third quarter of 2015. The gross national income has contracted in the second and third quarters of last year, the first two consecutive quarterly fall since the 2008 financial crisis. Monthly income of a household with the family head in the most economically active age group, the 40s, drooped 0.03 percent in the third quarter, falling for the first time. From domestic to external demands, circumstances appear to not have improved in the fourth quarter or will become any better this quarter.

Yet we do not see any preemptive action from the government. It has been slow in responding to the worst-ever egg shortage due to the bird flu epidemic that wreaked havoc on the poultry industry. Authorities are going ahead with utility fee hikes and not doing anything to slow the spike in supply-end prices through cuts in import tariffs. The Lunar New Year holiday is approaching. The government must do whatever it can to stabilize prices so as not to ruin the country’s biggest holiday season.

JoongAng Ilbo, Jan. 9, Page 30
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