| The Status and Policy Issues of the Local Specialty Alcohol Industry | |||
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| Author | Choi, Jongwoo | ||
| Views | 57018 | Publication Date | 2017.02.18 |
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Background to the research The national liquor market has been steadily increasing at an average of 3.3 percent per annum since 2010. In particular, due to the expansion of open market as a result of FTAs and Westernized diet, our national alcohol consumption has been increasing. However, the growth of the local markets has stalled. It is necessary to promote the development of the local specialty alcohol industry for the farmers’ income stability through value added work and stable supply of agricultural products. However, current Korean local specialty alcohol manufacturers are mostly small and are experiencing difficulty in expanding their business. Therefore, their foundation for development is weak. In addition, the regulations are being eased in order to promote the local specialty alcohol industry. However, strict regulations still exist to date. Also, the linkage between each government institution (Ministry of Agriculture, Food and Rural Affairs, National Tax Service and Ministry of Food and Drug Safety) is lacking and the lack of uniformity between the policies due to inability to cooperate between roles is restricting the ripple effect. Therefore discussions are required in regards to the sharing of information between institutions and cooperation between roles. This research promotes understanding of the overall changes to the local specialty alcohol industry after the enforcement of the 2011 Korean traditional alcohol policy and its purpose is to review the recent government policy and regulation on local specialty alcohols in order to propose a systematic government policy. Method of research In order to investigate the status of the local specialty alcohol industry and cases overseas, I carried out a literature research, statistics and quantitative analysis, a site survey, manufacturer and consumer surveys and commissioned expert advice. First, in order to investigate the status of the local specialty alcohol manufacturers and retailers I visited the main local companies and through trips abroad I grasped the exact state of the regulations and policy enforcements on the mainstream local specialty alcohol industry. In addition, by holding a conference of experts such as those from the government institution in charge of the alcohol department, academic experts and experts from research centers we discussed the ways to promote the policies for the local specialty alcohol industry. Further, in order to investigate the awareness on the local specialty alcohols and its policies I conducted a survey of 170 local specialty alcohol manufacturers and 500 consumers. Research results and implications We have to reconstruct the political vision and purpose proposed by the policies introduced in order to promote the local specialty alcohol industry such as ‘Strengthening Industrial Competitiveness of Korean Alcohol Industry’ and ‘Basic Plan for an Industrial Development of Korean Traditional Alcohol etc.’ and must reset the basic direction of the policy. Firstly, in order to secure self-regenerating strength of the local specialty alcohol industry, we must move away from the weak business structure and need support from the government. In addition, for the constant growth of the local specialty alcohol industry, we need to provide opportunities to the consumers to promote and sell the local specialty alcohols. With the reconstructed policy for the improvement of the local specialty alcohol industry as a basis, we need a strategy to advance ① economic strength, ② expansion of sales and distribution, ③ development of infrastructure to promote the industry, ④ alcohol tax law reform and ⑤ regional revitalization. Firstly, to strengthen the economic power of the local specialty alcohol industry, the relevant existing regulations should be eased in order to allow production of various types of local specialty alcohols. In addition, we need to modify the quality management and labelling system to create a policy which preserves the characteristics of the local specialty alcohols. To strengthen the economic power of the industry, it is also vital to provide R&D support for the weak local specialty alcohol manufacturers. Secondly, we need to allow certain wholesale businesses to sell other types of alcohol in order to secure expansion of the distribution and sales of local specialty alcohols. For the weak local specialty alcohol manufacturers who face difficulty in securing sales, we can also build a distribution center for the sale of the local specialty alcohols. In order to secure sales, we need to move away from the idea that only older people consume local specialty alcohols. It has been revealed that younger people who have tasted the local specialty alcohol have a high satisfaction rate. Therefore, we need to advertise and promote sales placing the younger people as the target and expand the consumer layer. Thirdly, by promoting business associations such as associations by types of alcohol, the suggestions in relation to the regulations and policies for the improvement of the local specialty alcohol industry need to be effectively delivered to the government. In addition, we need to encourage collection of self-help funds according to each classification and by using these funds independently we can better help the weak local specialty alcohol manufacturers. Lastly, we need to establish a Research Center for the Development of Local Specialty Alcohol (a tentative name) so that it acts as a foundation to provide consulting, education and training to the local specialty alcohol industry. Fourthly, we need to ease the existing regulations within the liquor tax law and improve the liquor tax system. We also need to discuss the import and specific duties in depth and establish a system which advantages each and every type of alcohol within the local specialty alcohol industry. Lastly, the government should provide support to the regional cooperative projects in relation to the local specialty alcohols to scale up the local specialty alcohol manufacture industry. To achieve this, the government needs to improve the geographical indication system to deal with the close-by local specialty alcohol manufacturers as a group and support a 6th business which enables people to tour and experience the local culture. In order to improve and to promote consistent growth of the local specialty alcohol industry, the local specialty alcohol manufacturers must become self-perpetuating. When the aforementioned strategies are implemented and reflected in the policies, we will be able to reach the political objectives and achieve our vision. Researchers: Choi Jong Woo, Huh Duk and Lee Dongso Research Period: 2016. 1. ～ 2016. 10. E-mail address: peacejchoi@krei.re.kr |
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