Government Implements Tariff-Free Policy on Beef, Chicken, and Infant Formula to Lower Import Costs and Reduce Prices

[Asia Economy reporters Kim Hyewon (Sejong) and Bae Kyunghwan] As the domestic consumer price inflation rate soared to the 6% range for the first time in about 24 years, the government has decided to additionally apply emergency tariff quotas (0%) on items with high perceived living costs such as beef, chicken, coffee, and infant formula. Bringing in U.S. and Australian beef duty-free is expected to reduce retail prices by up to 5-8%. The import cost of chicken, which currently faces tariffs of 20-30%, is also expected to be significantly lowered. In addition, support for vulnerable groups will be strengthened by increasing the subsidy amounts for energy vouchers, diapers and infant formula, and sanitary pads.

On the 8th, President Yoon Seok-yeol presided over the “1st Emergency Economic and Livelihood Meeting” at the Presidential Office to discuss these livelihood stabilization measures. This meeting was the first since President Yoon announced at the Cabinet meeting on the 5th that he would hold weekly Emergency Economic and Livelihood Meetings to directly oversee livelihood issues. Ministers and vice ministers from 12 ministries participated in full force. From the next meeting onward, the focus will shift to on-site visits to livelihood locations.

This livelihood stabilization plan is characterized by expanding both the scope and target groups while aligning with the policy tasks announced in four previous rounds, including strengthening support for vulnerable groups, reducing the burden of food expenses for ordinary citizens, and alleviating living costs. The application of tariff quotas has been expanded to major livestock products with notable price increases such as imported pork and beef, and plans are in place to increase market supply by supporting slaughtering and feed costs for farms. Agricultural products with unstable prices ahead of Chuseok, such as potatoes, garlic, onions, radishes, and napa cabbage, will be released early, and additional imports will be pursued in August and September. Some seafood items with continuously rising prices, such as mackerel, hairtail, squid, and pollock, will be switched to a regular release system.

The 30% reduction in sales surcharges on LPG, mainly used by taxi drivers and small business owners, will be extended until the end of the year, and the subsidy amount for tax-exempt diesel fuel for fishermen linked to oil prices will also be increased. The energy voucher amount will be raised from 172,000 won to 185,000 won, and for low-income families below the second-lowest income bracket with infants under two years old, single-parent families, low-income multi-child families, and families with disabilities, the subsidy amounts for diapers and infant formula will be increased to 70,000 won and 90,000 won per month, respectively. Support hours for care of the disabled will be expanded from 840 hours to 960 hours annually, and the living support allowance for crisis youth who are effectively unprotected will be increased to a maximum of 650,000 won per month, thereby increasing welfare budgets for vulnerable groups.

President Yoon hastened the Emergency Economic and Livelihood Meeting, originally expected next week, due to the complex crisis facing the Korean economy, caught in a quagmire of high inflation, high interest rates, and low growth. The meeting also served as an occasion to link the new government’s five-year fiscal management direction and fiscal reform tasks, discussed at the first National Fiscal Strategy Meeting since his inauguration held the day before, with policy formulation. Since economic recovery through expansionary fiscal policy, as pursued by the Moon Jae-in administration, is no longer effective, the plan is to manage the livelihood economy with budgets secured through a shift toward sound fiscal policy. “As this was the first meeting, it was a place for ministries to openly share livelihood issues and jointly come up with solutions,” explained a senior government official who attended the meeting. Inside the Presidential Office, there is a strong sense of crisis that failure to control soaring prices will make governance difficult. The recent simultaneous decline in approval ratings for President Yoon and the People Power Party is also interpreted as a preliminary sign. A Presidential Office official said, “Unlike party-government consultations or emergency economic ministerial meetings, this meeting body will handle more detailed information and practical alternatives, and relevant ministries will promptly take follow-up actions.”

This content was produced with the assistance of AI translation services.