South Korea’s food prices rose at the second highest rate among Organization for Economic Cooperation and Development members in 2011, mainly due to unfavorable weather conditions, a report showed Thursday.
The report by the Paris-based organization showed the country’s food prices jumping an average 7.9 percent in the January-November period, with only Estonia’s growth being steeper at 9.9 percent among the 32 countries checked.
South Korea’s consumer prices rose 4 percent on-year in 2011, which is the fourth-highest gain after Turkey, Estonia and Poland. Turkey’s inflation rate hit 6.3 percent.
Cold weather, floods and other developments affected output of various fresh vegetables, the OECD said, adding that a rise in international crude prices exerted upward inflationary pressure.
Related to the hike in prices, the Hyundai Research Institute, a local private think tank, said because of the country’s small size and relative shortage of arable land, South Korea’s food prices generally rise at a faster pace compared to other OECD countries.
While inflation pressure may subside this year vis-a-vis 2011, the slower pace economic growth forecast could negatively influence ordinary consumers, the think tank said.
The Bank of Korea predicted the country’s consumer prices will drop 0.7 percentage points from the previous year to 3.3 percent in 2011, with private think tanks here predicting inflation will hover in the mid-3 percent range.
The government and the BOK said that for the new year, the country’s economic growth may reach 3.7 percent, down from 3.8 percent estimated for last year.
(Yonhap News)
