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How extreme heatwave affects S. Korean economy

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ArirangNews

Arirang News

Let's take a closer look at the prolonged heatwave that's been suffocating South Korea for a number of weeks now.
As well raising physical discomfort levels,... it's raising some economic discomfort as well.
The soaring temperatures have caused food, gasoline and energy prices to spike.
Ko Roon-hee reports.
The owner of this Seoul restaurant, Kim Hae-soo, says this summer was particularly brutal for his business.
As Korea reached the hottest temperature it's ever recorded... the price of vegetables soared,... which means Kim's menu has been a lot more expensive to make.

"I feel like vegetable prices have risen more than 3 fold recently because of the hot weather. I hope the heatwave ends soon… so I can buy ingredients at a normal price."

Data from the Korea Consumer Agency earlier this week showed vegetable prices had jumped by 5-point-4 percent as of August 3rd… from just a week earlier.
Cabbage prices rose the most, by 41-point-2 percent, followed by spinach and napa cabbage.


And it's not just vegetables,… fruit prices are also rising. Here at a supermarket in Seoul, one watermelon costs around 20 U.S. dollars. This is more than a 20-percent increase from last month's average price.


"When fruit was cheap, I would buy a lot. But because it's so expensive now, I tend to eat less fruit."

There are also more areas now covered by agricultural insurance programs, which compensate for crop damage.
A property insurance company says the area covered was around 321-thousand hectares for all of last year... but that figure was already surpassed as of the end of July.


"When farmers sign up for insurance, they have to pay a certain premium. On average, the central and local governments pay for 80 percent of it and farmers pay 20 percent."

Another burden has been soaring rates for fuel and electricity.
Korea National Oil Corporation says the average price of gasoline in the first week of August was around 1 U.S. dollar and 43 cents a liter,… the highest so far this year.

To help with the cost of electricity, the government has reduced the rates for household use for July and August.
A household of four using 350 kilowatt-hours of power in a month... would only have to pay around 58 dollars -- down 25-and-a-half percent from the normal rate.
Ko Roon-hee, Arirang News.

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