EDITORIAL: Korean retailers under siege

Seoul (The Korea Herald/ANN) - The central government is putting undue pressure on E-mart and other retail giants not to raise prices, while Seoul¿s metropolitan government is taking ill-considered steps to have certain items removed from their shelves. Those actions against the retailers, however, are not legally warranted.

On Thursday, the Ministry of Knowledge Economy summoned executives of E-mart, Homeplus and Lotte Mart for talks on price stability. A ministry spokesman¿s comment on the meeting was mildly worded. He said the ministry "requested them to refrain from raising prices". But the retail chain executives were undoubtedly well aware that a request in Korean bureaucratese is synonymous with a demand or an order.

The ministry¿s coercive action followed anti-inflation remarks by President Park Geun-hye, who recently said that she was determined to stabilise the prices of daily necessities. In a follow-up, relevant government agencies have since been working on price stability.

But the irony is that the central government is waging a war on price increases at a time when prices have already stabilised. The consumer price index has remained below the 2 per cent mark since November. Economic think tanks say they expect the index will hover around the 2 per cent level throughout the year.

Moreover, an effort to stabilise prices by arm-twisting is a tried and failed method, as evidenced by former President Lee Myung-bak¿s price policy. The prices of 52 daily necessities, which had been under control during Lee¿s presidency, gained 25.8 per cent, compared with the consumer price index of 16.5 per cent, in the five-year period.

Even more threatening is Seoul¿s metropolitan government¿s move to ban the sale of 51 items - mostly perishables, marine products and processed foodstuffs - at large discount chains. The metropolitan government is empowered by an ordinance to recommend sales restrictions. Here again, defiance against a recommendation is an invitation to arm-twisting.

The metropolitan government says it will hold a public debate on the restrictions next month and file a petition to the National Assembly to enact a law banning the sale of the items at discount chains. The proposed ban, if written into law, would mean a 15 per cent cut, or a decline of 2.2 trillion won, in the total sales of the chains each year.

The metropolitan government says its action is designed to protect small stores. But the problem is that it ignores the interest of consumers, who would like to purchase all items they need in one place and at lower prices.

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • Lenten procession more than just a spectacle VERA Files - The Inbox

    Text and photos by Kiersnerr Gerwin Tacadena, VERA Files Baliuag, Bulacan--This town is hosting what could be the country’s biggest Lenten procession consisting of more than 100 religious statues riding on carriages or carrozas. But concerns are being raised that … Continue reading → …

  • Holy Week in Mt Banahaw: Mysticism meets Catholicism VERA Files - The Inbox

    Text and photos by Patricia Isabel Gloria, VERA Files Dolores, Quezon—Around this time each year, hundreds of devotees flock to Barangay Sta. Lucia in Dolores, Quezon on the slopes of Mount Banahaw to celebrate Holy Week. Here, mysticism meets Catholicism, … Continue reading → …

  • Simbang lakad for Lolo Uweng VERA Files - The Inbox
    Simbang lakad for Lolo Uweng

    By April Anne Benjamin, VERA Files San Pedro, Laguna--For 14 Maundy Thursdays now, Inding Amoranto has prayed the rosary while walking the eight-kilometer distance from her house to the Shrine of Jesus in the Holy Sepulcher in the village of … Continue reading → …

POLL
Loading...
Poll Choice Options