This is the second in a three-part series on the controversy over an anti-graft bill scheduled to take effect on Sept. 28. ― ED.
By Kim Bo-eun
The anti-graft act scheduled to go into effect Sept. 28 is expected to weaken already sluggish domestic consumption further, dealing a direct blow to the agriculture, livestock, fisheries and food service industries.
The so-called Kim Young-ran Act bans civil servants from being treated to meals worth more than 30,000 won and receiving gifts worth more than 50,000 won.
Industry sources say if gift sets must be priced at 50,000 won, retailers will have to forgo selling better-quality and pricier domestic produce, substituting cheaper, lower-quality imported items. Restaurateurs say they will have to lower their prices, which will result in losses and possible closures of their businesses.
An association of agriculture and livestock businesses held a rally in front of the Government Complex in Seoul, Wednesday. "The law does not reflect reality. The price limit on gifts will lead us and the whole domestic economy into financial crisis," the group said.
It demanded that the industries be excluded from the act.
The act is also expected to deal a serious blow to the Korean beef industry, as Korean beef, or hanwoo, is among the highest priced items in the agro-livestock and food industry.
"The nature of agricultural, livestock and marine produce is that prices are greatly affected by supply and demand conditions," said Cho Hae-in, a Hanwoo Association official. "The burdens will go to the farmers, breeders and fishery producers. We are calling for the law to be revised so that domestic produce is excluded from the gift limit," she said.
Lawmakers have taken action, but the likelihood of revisions before enactment seems low.
Rep. Kim Jong-tae of the Saenuri Party submitted revisions last month, which exclude agricultural, livestock and marine products from the gift price limit.
"When considering that 50 percent of fruit gift sets and 99 percent of hanwoo and yellow corvina sets cost more than 50,000 won, some 1.3 trillion won in losses will occur when the act goes into effect," Kim said.
Rep. Kang Seok-ho of the party also proposed that the exchange of agriculture, livestock and marine produce gifts be allowed during traditional holidays such as Chuseok and Seollal.
Studies show up to 50 percent of domestic agricultural, livestock and marine produce are consumed during those holidays as gifts.
According to another report by the Korea Economic Research Institute last month, the act is forecast to produce losses amounting to a total of 11.6 trillion won in all related industries, including agriculture, food, consumer goods, retail industries and golf clubs.
Among them, the restaurant and food service industry is expected to be among the hardest hit, with losses expected to reach over 4 trillion won. Those in the industry say it is difficult for them to come up with quality dishes for less than 30,000 won.
"The public servants' code of conduct, which was drawn up in 2003, said they were not allowed to have meals that cost more than 30,000 won. This was more than a decade ago, and considering the inflation rate, it is unreasonable to impose the same standard in 2016," said an official at the Korea Food Service Industry Association (KFIA).
"We agree that there is a need for the anti-graft law, but considering the circumstances of the food service industry, we demand the 30,000 won limit be raised to 50,000 won," he said.
Both Cho of the hanwoo association and the KFIA official said the losses will be substantial, because the effects of the law will go beyond the people directly subject to the regulations and affect overall domestic consumption.
By Kim Bo-eun
The anti-graft act scheduled to go into effect Sept. 28 is expected to weaken already sluggish domestic consumption further, dealing a direct blow to the agriculture, livestock, fisheries and food service industries.
The so-called Kim Young-ran Act bans civil servants from being treated to meals worth more than 30,000 won and receiving gifts worth more than 50,000 won.
Industry sources say if gift sets must be priced at 50,000 won, retailers will have to forgo selling better-quality and pricier domestic produce, substituting cheaper, lower-quality imported items. Restaurateurs say they will have to lower their prices, which will result in losses and possible closures of their businesses.
An association of agriculture and livestock businesses held a rally in front of the Government Complex in Seoul, Wednesday. "The law does not reflect reality. The price limit on gifts will lead us and the whole domestic economy into financial crisis," the group said.
It demanded that the industries be excluded from the act.
The act is also expected to deal a serious blow to the Korean beef industry, as Korean beef, or hanwoo, is among the highest priced items in the agro-livestock and food industry.
"The nature of agricultural, livestock and marine produce is that prices are greatly affected by supply and demand conditions," said Cho Hae-in, a Hanwoo Association official. "The burdens will go to the farmers, breeders and fishery producers. We are calling for the law to be revised so that domestic produce is excluded from the gift limit," she said.
Lawmakers have taken action, but the likelihood of revisions before enactment seems low.
Rep. Kim Jong-tae of the Saenuri Party submitted revisions last month, which exclude agricultural, livestock and marine products from the gift price limit.
"When considering that 50 percent of fruit gift sets and 99 percent of hanwoo and yellow corvina sets cost more than 50,000 won, some 1.3 trillion won in losses will occur when the act goes into effect," Kim said.
Rep. Kang Seok-ho of the party also proposed that the exchange of agriculture, livestock and marine produce gifts be allowed during traditional holidays such as Chuseok and Seollal.
Studies show up to 50 percent of domestic agricultural, livestock and marine produce are consumed during those holidays as gifts.
According to another report by the Korea Economic Research Institute last month, the act is forecast to produce losses amounting to a total of 11.6 trillion won in all related industries, including agriculture, food, consumer goods, retail industries and golf clubs.
Among them, the restaurant and food service industry is expected to be among the hardest hit, with losses expected to reach over 4 trillion won. Those in the industry say it is difficult for them to come up with quality dishes for less than 30,000 won.
"The public servants' code of conduct, which was drawn up in 2003, said they were not allowed to have meals that cost more than 30,000 won. This was more than a decade ago, and considering the inflation rate, it is unreasonable to impose the same standard in 2016," said an official at the Korea Food Service Industry Association (KFIA).
"We agree that there is a need for the anti-graft law, but considering the circumstances of the food service industry, we demand the 30,000 won limit be raised to 50,000 won," he said.
Both Cho of the hanwoo association and the KFIA official said the losses will be substantial, because the effects of the law will go beyond the people directly subject to the regulations and affect overall domestic consumption.
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