Recently the world grain prices have rapidly sky-rocketed. The food self-sufficiency rate of Korea is only 26.5% in 2007. Korea is the fifth largest in volume among food import countries in the world. Korea has experienced huge difficulties particularly in livestock and food industry.
One of the direct reasons for higher international grain prices is the increase of grain demand for bio-fuel energy. The trend of combing the food security with the energy security makes the structure of grain supply and demand more complex.
If the grain market structure changes from a circular structure like a business cycle to a chronic extra demand structure, the strategies for securing international grains should be established. Some of the strategies of mini- mizing the negative effects of higher grain prices are the establishment of the early warning system, the expansion of the future market for grains, and the active policy supports for setting up the oversea agriculture development system. This study focuses on the oversea agriculture development strategy and its implementation. Korea should prepare specific strategies and protocols for the oversea agriculture development.
Since 1960s, public and private sectors have tried agricultural investment in foreign countries to show unsatisfactory results due to unpre- paredness in terms of prior feasibility studies, failure to secure specialized managers, failure in finding markets, lack of governmental supports, absence of clear-cut visions and strategies, and so forth.
It is suggested in this study that the policy objectives should be established, which may be as follows: stabilized access to food-grains, increased competitiveness of domestic agriculture through globalization, design of agricultural investment model for mutual benefits between Korea and target country, search for solution of food shortage problem which would occur after Korean unification, and enhancement of economic status of oversea Korean residents.
In order to achieve the above objectives, it is recommended, as policy directions, to enhance self-sufficiency capacity for major strategic crops, to expand capability of oversea food resources development, to establish support system for private investment, and to establish competitive domestic agricul- tural system.
Several strategies are also suggested here. They are as follows; tailor-made oversea agricultural development strategy by regions and by strategic crops, development strategy in which agricultural development is combined with other non-agricultural resources development, organization of special promotion agency for implementing comprehensive oversea agricultural development, funding for the oversea agricultural development, support system for specialized personnel training and related technology transfer, streng- thening of foreign relations with target countries, establishment of information network, and strategy to secure domestic demand market for the imported food-grains.
Public sector shall take initiatives in investment, meanwhile govern- mental sector's role is confined to indirect support. Several concerned ministries, including the Ministry of Food, Agriculture, Forestry and Fishery, the Ministry of Strategy and Finance, the Ministry of Foreign Affaires and Trade, the Ministry of Knowledge and Economy and so forth, should commit in relevant areas and maintain organic cooperative relationships. Inter- ministerial organization may be needed in this regard.
Private enterprises are in need of supports, which may be provided by public sector through financial and tax benefits, information provision, human resource training, technical support, consulting of management and legal system, etc.
This study examines the possibility of import of agricultural products produced oversea by Korean enterprises of farmers. WTO prohibits special treatments, such as tariff reduction or tax relief, for those products. Therefore, those kind of special treatments can be negotiated when entering into a FTA with target countries, for instance. Also, separate subsidy for oversea agricultural development or government procurement of the products can be taken into consideration as alternative policy measures.