By Yoon Ja-young
Staff Reporter
Import prices of some 100 goods, including jeans and frames of glasses, will be posted on the Web site every month, so that consumers can choose to avoid shops that charge too much, the government announced after a task force meeting to stabilize the livelihood of the working class Friday.
The government also announced that it would charge money at parking lots of government complexes, and check for cartels on goods whose domestic prices are much higher than those overseas.
Despite the measure to stabilize prices, concern is growing over the new government's growth-oriented policies. Concern over stagflation is looming with signs of a slowdown amid high inflation.
The National Statistical Office announced Thursday that consumer prices rose 4.1 percent in April from a year ago. It is the first rise over 4 percent during the last three years and eight months.
Consumer price growth is likely to hover above 4 percent in May, as international oil price hikes will be reflected in prices of consumer goods. The government had chosen 52 daily necessities to specially monitor prices, but prices of these goods rose even higher at 5.88 percent.
As inflation is based on the external factor, global inflation, it is difficult to find effective measures to stabilize prices. The United States saw 4 percent inflation in March; China 8.3 percent; and Singapore 6.7 percent.
Inflation has risen as the biggest trouble facing the economy, as it could dwarf consumption. The falling value of the local currency following inflation could lead to real estate speculation, and the pressure for wage hikes would intensify, forming a vicious circle.
The government, however, has been focusing on ``growth'' over ``inflation.'' Strategy and Finance Minister Kang Man-soo had said it is choosing between ``having less money to spend following inflation and losing a job,'' implying that the ministry prefers economic growth to create jobs to suppressing inflation. Vice Strategy and Finance Minister Choi Joong-Kyung said Thursday that the grand canal project would boost the economy, implying that it would continue the huge infrastructure project to boost the economy.
The growth-focused policymakers have been pressuring the Bank of Korea to cut interest rates, and have shown preference for a weak Korean won to boost exports. The weakening won, however, means imported goods will be made even more expensive for local consumers.
Economists advise that taming Inflation should come first for now. The Korea Development Institute concluded that consumption affects the job market more than does investment, contradicting the government policy to create jobs through growth at the expense of price stabilization.
The worsening job market condition is causing anxiety among the working class. The economic think tank expected the number of jobs to grow by only 222,000 this year, falling far short of President Lee Myung-bak's pledge of an annual 600,000 new jobs.