This is the fifth of a series of interviews with top officials and trade-related association chiefs on FTAs in light of the Korea-U.S. FTA taking effect. ― Ed.
Despite the expected blow to Korea’s agricultural industry in the wake of its free trade pacts with the United States and the European Union, the nation’s food exports will top $30 billion by 2020, the agriculture minister said.
Listing the fresh wave of K-pop as a major potential boost to the industry, Agriculture Minister Seo Gyu-yong expressed full confidence in tripling the exports target in less than a decade.
“I have no doubt that agro-fishery exports can reach $30 billion by 2020. This is a very feasible number if the figure grows by about 20 percent annually,” Minister Seo said in an interview with The Korea Herald last week.
Agriculture Minister Seo Gyu-yong (Lee Sang-sub/The Korea Herald)
“I am confident that the country can make it onto the top 10 largest food exporter list within the next decade. Free trade agreements pose challenges to the sector, but new markets are also opening up for us with the deals,” Seo said. The ministry’s export target for this year is $10 billion.
Pointing to positive responses to Korean food from Spain and Japan, where he made recent trips, Seo said “K-food” would become ever more popular on the back of K-pop.
“Hongcho, a raspberry flavored red vinegar, has become so popular in Japan because K-pop group Kara modeled for it there. K-pop stars are really a springboard to the K-food industry and the marketing help there will greatly enhance exports,” Seo said.
Seo, who orchestrated support measures for the sector hit by the FTAs, said the agro-fisheries industry needs to go through reform as trade barriers fall.
“The FTAs pose challenges, but they are also an opportunity. Farmers won’t be able to survive with the old style of leasing on a small patch of land. Their business models should turn into capital intensive, technology-intensive ones,” the minister said.
He said reform has become an issue of survival with the Korea-U.S. free trade agreement, which is expected to wipe out at least 12.67 trillion won in local production in the agriculture and livestock industries over the next 15 years, according to government estimates.
Seoul in January assigned an additional 2.9 trillion won in support to cushion the impact of the Korea-U.S. FTA. Of the 2.9 trillion won, 2 trillion won will be used as direct financing and 900 billion won in tax benefits. The government will inject 10 trillion won ($8.64 billion) over the next decade to modernize production facilities.
The total set aside as subsidies and investment for the agro-fisheries industry is 54 trillion won by 2017.
Seo welcomed the government’s push to ink another trade pact with China and called it an “unavoidable choice” this trade-dependent country needs to make.
“We’re currently conducting working-level discussions with China. The Agriculture Ministry will do the very best to protect the sectors that stand to lose the most with competition from China,” Seo said.
“The government will first seek ways to protect farmers of red pepper, garlic, onion and seafood, clear that out with the Chinese counterpart, and proceed to other negotiations,” he added.
By Cynthia J. Kim
(cynthiak@heraldcorp.com)