Currently South Korea is facing severe inflation, although the government has implemented four rounds of measures to stabilize the price. Therefore, on July 8, President Yoon Suk Yeol summoned the First Emergency Meeting on People’s Livelihood Stabilization to further discuss the countermeasures to curb inflation. 1 One of the critical policies brought out in the meeting is levying a zero-percent quota tariff on seven imported food items and adjusting the Tariff Rate Quotas (TRQ) volume of two imported food from the middle of July to the end of this year.2
1. Imported Items with a Zero-Percent Quota Tariff
Beef (chilled and frozen) (100,000 tons)
Chicken (82,500 tons)
Milk powder (whole milk powder and skim milk powder) (10,000 tons)
Leek (448 tons)
Raw materials for alcohol (roughly distilled alcohol 64,833 kl, Manioc chips 51,833 tons)
Pork (expanded from 10,000 tons to 30,000 tons)
2. Imported Items with Adjusted TRQ Volumes
Soybean (newly adding 10,000 tons)
Sesamum seed (newly adding 3,000 tons)
South Korea’s beef import volume is higher than ever before. However, affected by the global inflation and a persistent increase in beef price in the exporting countries, Korea’s imported beef price has risen by 40%.3
US and Australia are the major beef suppliers to South Korea, with a tariff of 10.6% and 16% respectively under FTAs. The zero-percent quota tariff allows beef enters South Korea at zero duty, which is anticipated to save tax payment of about 224.26 billion won (about 171.43 million dollars).
Regarding chicken, Brazil and Thailand account for 94% of Korea's imported chicken volume. As both countries currently have no tariff concessions, the zero-percent quota tariff will reduce the tax from 20~30% to 0%, bringing great benefit to suppliers and consumers.