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Challenges and Various Developmental Strategies in Korean Urban/Peri-Urban Agriculture
Woong Kwon
NACF Research Institute
9F, Imgwang Bldg., 267, Migeung-dong,
Seodaemoon-gu, Seoul 120-705
Korea, 2007-05-31

Abstract

During the second half of the 20th century, Korea has made significant developments in the area of urban/peri-urban agriculture (UPA) using available resources in various socioeconomic environments, and consequently in converting traditional development strategies into new approaches to address emerging challenges in UPA, specifically in terms of agricultural economics, environmental concerns, and rural development. This paper describes the historical development and current situation of UPA in Korea, as well as recent challenges and various strategies being adopted in the country. It focuses on some critical factors influencing Korea's UPA, such as the rising farmland price, declining price competitiveness, and the waning farmers' interest in agricultural production. In the course of overcoming these challenges, new strategies and approaches in the promotion and development of UPA are also discussed. Lastly, this paper looks into successful cases related to the development of UPA in Korea, which are initiated by agricultural cooperatives and implemented in collaboration with member farmers, municipal and central government, and civil society movements.

Key words: Urban/peri-urban agriculture (UPA), socioeconomic strategies, agricultural cooperatives

Introduction

Korea has accomplished high economic growth since the 1970s, and with it comes rapid urbanization. The rate of urbanization in the country is almost 80%, with half of the total population living in the peri-urban areas of Seoul, the capital of Korea.

During the early urbanization stage, Korean urban/peri-urban agriculture (UPA) started out under favorable conditions. Agricultural products cultivated in the peri-urban areas were delivered promptly to the big city. It was also easy to find workers who live in the city or in peri-urban areas. In addition, it was more favorable for farmers to determine consumer preference change and to use such trend to improve agricultural production in peri-urban areas.

Recently, however, the development of transportation and communication systems has weakened the various advantages of peri-urban farming. For example, modern and efficient transportation and communication system has reduced the geographical advantage of UPA. Also, the enormous rise in land price caused by rapid urbanization has increased product cost, and has resulted in the decline of price competitiveness of agricultural products cultivated in peri-urban areas. Furthermore, city dwellers now own much of peri-urban lands, and they have very little interest in farming. They acquired the farmlands as investment and in expectation of rising land price.

Nowadays, the central government, local government, and agricultural cooperatives as well as the farmers are trying to redevelop UPA, but the strategies are different from those of the past. What is most significant about this renewed attention to UPA is that it now focuses on such concepts as environmentally friendly farming, green tourism, and information technology. These endeavors are expected to create a new momentum for the development of UPA.

The purpose of this paper is to review the present situation and the development strategy of Korean UPA. It presents a brief history of Korean UPA and discusses favorable and necessary factors for the development of UPA in the country. The critical factors affecting UPA are addressed, and strategies being used in current efforts to revitalize UPA in Korea are presented.

The History of Urban/Peri-Urban Agriculture in Korea

Development of Urban/Peri-Urban Agriculture (Upa)

Korea has a small land space for its population, and about 70% of its total land is composed of mountains, making farmland scarce. Because of the small size of farmlands, various kinds of agricultural products are being cultivated intensively in small scale. This type of farming has been sustained for a long time. With the advent of rapid industrialization from the 1970s, many farmers have given up farming and moved to urban areas to acquire more profitable jobs. In Korea, the amount of export has risen from US$0.8 billion in 1970 to US$254 billion in 2005. Meanwhile, the number of farmers has dropped from 15 million to 3.4 million during the same periods ( Fig. 1(1093)).

In the meantime, industrialization made a good impact for the promotion of UPA. In the past, there were many geographical merits in UPA, as the big city provided a number of favorable conditions for the development of this type of agriculture. First of all, there were big markets near peri-urban farmlands. Transportation and delivery systems were not well developed yet. Railroads and highways were also not well equipped. Hence, it was very difficult to deliver agricultural products promptly to the market, and it was impossible to have fresh agricultural produce coming from far away rural areas. For that reason, fresh agricultural products, such as vegetables and fruits, were mainly coming from peri-urban areas. According to statistical data, the total number of Korean farm households cultivating vegetables in the 1970s was 34,000, and almost 14% (4,800 households) lived in the peri-urban areas of Seoul. In terms of cultivated area, the peri-urban areas of Seoul occupied 12.1%. Considering the very small farmland in this areas, the percent ratio was so high.

Another reason for the development of UPA was the absence of well-equipped distribution and processing systems at that time. For example, in the case of dairy industry, facilities needed to process milk were not available in rural areas. Cooling system and storage houses were scarce, and with deficient highways and railroads, insufficient storage and processing facilities hampered the development of the dairy industry in the rural areas.

Along with the process of urbanization, UPA continuously developed. Vegetables, flowers, and fruits were mainly cultivated in peri-urban areas. These were value-added products sold at a high price and which needed quick delivery to keep freshness. Therefore, vinyl or plastic green house farming, and dairy industry with high capital investment were prevalent in peri-urban areas.

Necessary Conditions for the Development of Upa

UPA developed in the early stages of industrialization. In those times, there were many favorable conditions for the development of UPA as follows:

Favorable conditions for production requisites supply. The three requisites for agricultural production are labor, land and capital. In the beginning of the early industrialization, the production requisite conditions were favorable for UPA.

Firstly, there was abundance of labor force in peri-urban areas. Korea achieved a speedy industrialization growth from the 1970s. As a result, many farmers moved from rural to urban areas to get more profitable jobs, making it difficult to find workers in the rural areas. Consequently, it became easy to get workers in peri-urban areas. The farmers who left the rural areas mainly settled in peri-urban areas of the big cities. Because housing rent cost was so high, the farmers could not live in the city. Therefore, there was much abundance of labor force in the peri-urban areas, but many of these workers could not get regular jobs, and eventually became the labor forces to UPA at very low costs. These favorable conditions in terms of labor forces became factors for the development of UPA.

Secondly, acquiring farmland for farming was not difficult in peri-urban areas. At the beginning of industrialization, the urbanization process in peri-urban areas was not yet so severe. This meant that even though urbanization increased day by day, there was still much farmland in peri-urban areas. Moreover, much of the land around the big city was designated as greenbelt area. The purpose of greenbelt areas was to prevent enlargement of urban areas. Building of factories and houses was constrained in greenbelt areas. Therefore, farmers in greenbelt areas were able to occupy farmlands more easily. Land price was also not so high in the beginning of industrialization, such that farmers could get large farmlands for UPA.

Thirdly, investment in UPA was favorable to farmers. Products cultivated in peri-urban areas could be sold at more favorable price compared to those cultivated in remote areas. Agricultural produce from peri-urban areas could also be delivered to the market very quickly, making it possible to keep the products fresh, and quality was much better. However, because of high production cost, agricultural products from peri-urban areas were also more costly. Farmers were growing mainly value-added agricultural products in peri-urban areas, which could be sold for higher prices. This encouraged farmers to invest more money on UPA.

Favorable market conditions. Peri-urban areas were surrounded by large consuming markets. There were many wholesale and retail markets close to farmlands, hence, it was easier and faster to deliver and sell agricultural products to consumers.

Geographical conditions close to big markets contributed to reduced delivery cost. Because the distance was short from production to market, UPA was favorable in terms of cost reduction compared to rural agriculture. Consequently, it resulted in lowering of the price of agricultural products cultivated in peri-urban areas, and gave more favorable conditions in terms of price competitiveness.

In the past, facilities related to agricultural processing, cooling and storing were scarce, and were mainly aggregated around the city. Therefore, it was inconvenient for farmers in the rural areas, but favorable to farmers in peri-urban areas. Farmers in peri-urban areas could use the facilities conveniently, and they also could supply agricultural products to the factories as raw materials, giving them new market opportunities. Farmers also had the chance to expand sales of agricultural products by direct selling to these factories.

Farmers in peri-urban areas could also get information about market more easily. Because UPA was close to the markets, it was easy for farmers to find information related consumers, such as new consuming trends. They used these information in agricultural production to raise competitiveness in terms of quality.

Early economic situation. Transportation system was not yet developed in the beginning of industrialization, and it became a favorable condition for the development of UPA. In the past, transportation and communication systems were not well equipped. Railroads and highways were scarce and telecommunication systems were insufficient. Therefore, it was so inconvenient to deliver agricultural products from rural areas to urban areas. Moreover, the cost of transport was so high that remote area farmers had difficulty in delivering fresh products. Because of inefficient transport system, it was difficult to sustain freshness of agricultural products, such that vegetables and fruits had to be cultivated in areas close to the big cities.

In the meantime, economic growth also resulted to Korean people consuming more quality foods. In particular, many Koreans started consuming expensive agricultural products like fresh vegetables, fruits and meats as a result of economic growth. Before industrialization, demand for these agricultural products were not very high. But as income level increased with industrialization, many people were able to buy expensive agricultural products, mainly cultivated in UPA. Therefore, as industrialization continued to rise, UPA also developed at the same phase.

Present Situation of Upa in Korea

Urbanization and Urban/Peri-Urban Agriculture

As a result of industrialization, urbanization increased rapidly in the country. The process of urbanization has resulted in the rise of land price in peri-urban areas, which consequently had many effects on UPA.

Effects of land price rise on UPA. The most significant effect of urbanization on UPA was the rise in land price in peri-urban areas. While this was apparently advantageous in terms of property value to farmers who hold farmlands in peri-urban areas, it also brought about many problems in terms of farming. The rise in land price in peri-urban areas was caused not by expected increase in agricultural income but by the possibility that farmlands would be converted into factories or housing areas, giving owners great marginal profits.

The effects of UPA caused by the rise in land price can be classified as follows. Firstly, because of high land price, the pattern of farming has changed gradually to capital-intensive agriculture. That is, much more capital is invested leading to the strengthening of commercial agriculture. Secondly, farmers sustain traditional farming without additional investment, expecting rise of land price in the near future. In this case, farmers have more interest in land price than in improving agricultural productivity. Thirdly, farmers sell some parts or all lands to get marginal profits after the rise in land price. Farmers who sold all farmlands quit farming and moved to cities for new jobs, while some farmers remained in peri-urban areas with a side job in the city.

Urbanization affected UPA both positively and negatively. That is, enlargement of urbanization precipitated capital-intensive commercial agriculture, consequently improving agricultural competitiveness. But some farmers sell farmlands to get marginal profits, or just hold on to their land expecting rising price. This eventually weakened the foundation of UPA.

Capital-intensive UPA. Agriculture can be classified into two types. One needs a wide farmland, while the other needs transportation, capital and skill more than the size of the land. With UPA, wide farmland is not possible due to the high land price in urban areas, hence, capital-intensive agriculture which requires much capital investment is more suitable. Compared to grain production, capital investment and farming skills are more important to horticulture than size of land. Therefore, vegetables, fruits, and flowers are the ones mainly cultivated in UPA.

In Korea, rice farming is absolutely important, such that the price of paddy field is generally higher than that of dry field. In contrast, in peri-urban areas, dry field price is generally higher than paddy field price. Also in peri-urban areas, horticulture farming is widely practiced than rice farming. The demand for dry field is higher than that for paddy field. And because dry field can be converted more easily into factories or housing sites than paddy area, its price tend to be higher. Consequently, in peri-urban areas, capital-intensive agriculture is mainly practiced rather than rice farming due to high land price.

Recent Challenges in Upa

Decrease in competitiveness of urban/peri-urban agriculture. The development of transportation and communication systems has weakened favorable conditions of UPA. Through transportation and cooling facilities development, farmers can now deliver agricultural products to the market very promptly and can keep them fresh for a long time. Secondly, farmers who practice farming in remote areas can now easily get new farming skills and information through modern communication system. As a result, technological gap between rural and urban areas gradually disappeared. Therefore, remote rural agriculture has now become competitive to UPA. For these reasons, the closeness of production area to the big city does not anymore guarantee high agricultural income.

On the contrary, UPA has become disadvantageous compared to rural agriculture. Land price is so high in peri-urban areas. Because too much money went into farmland acquisition, farmers have difficulty to ensure fubd for operation of farm business. Some farmers just sustain farming without effort expecting rising land price. These factors have weakened the merits of UPA.

The development of storage and cooling system is also affecting UPA. In the past, it was very difficult to keep agricultural products fresh for a long time because of insufficient storage and marketing facilities. Therefore, quick delivery to the market through UPA was favored. Also, in the past, most marketing facilities were concentrated in and around the city, giving UPA more opportunities to use these facilities. Nowadays, however, agricultural marketing facilities have advanced rapidly. Cooling system and storage facilities have been set up almost everywhere, reducing the merits of UPA. Farmers whose farmlands are far from the city can now easily use these facilities.

High price of peri-urban land and development of transportation, communication and marketing facilities have made remote-area farming more favorable. In terms of productivity and efficiency, remote-area farming has surpassed UPA. Because of these reasons, UPA has shrunk rapidly in recent years.

Rise in farmland price. As urbanization rises, so is peri-urban land price. According to statistical data, the farmland price in peri-urban area has risen from US$36/3.3m2 in 1990 to US$73/m2 in 2004 ( Fig. 2(1090)). This shows that farmland price has risen more than two times during the period. Moreover, much farmland has been diverted into factory or housing sites. These reasons have caused the breakdown of the foundation of UPA.

There is now a law that restricts diversion of farmland into factory or housing site. But as urbanization goes on, demand for housing and factory site is also rising. Therefore, the law can never stop diversion of farmland into other uses.

The rise in land price gives many opportunities to farmers. Firstly, some farmers still use their land for farming. In this case, because land price is so high, capital-intensive farming is suitable for UPA. Secondly, farmers just hold on to their farmland not for farming but as a valuable asset. In this case, farmers do not take part in farming actively, and just look forward to rising farmland price. Thirdly, farmers divert farmland to other uses. In this case, farmers sell farmland to companies and investors.

The second and third factors have considerably obstructed the development of UPA. If land price goes up, it is very difficult for farmers to sustain farming because cost for lent or buying farmland is so high. Therefore, rise in land price has resulted in shrinking of UPA.

Decrease in farmers' will to develop farming. As a result of industrialization, the opportunity to get other jobs increases in urban areas, such that farmers who live in peri-urban areas can easily get side jobs. Since most Korean farmers are small-income farmers, side jobs are important to them. Therefore, farmers who live in peri-urban areas can choose between two options. The first option is entering capital-intensive commercial farming. The second option is to get a side job. These two options provide the possibility to give much more income to farmers who live in peri-urban areas than to farmers who live in rural areas.

But the rise in the number of farmers who have side jobs also has a negative effect on UPA. Many young farmers have moved to cities to get jobs. And as farmers who get jobs in the city increase, it becomes more and more difficult to find workers in the rural areas. This resulted in many farmers giving up labor-intensive farming because of labor scarcity. Farmers who got jobs in the cities earned more and ceased to engaged in farming actively. Some were satisfied just to own high-priced land.

The increase in the number of farmers with side jobs contributed to increased income. However, this trend hampered the development of agricultural productivity under UPA. Because there were side jobs, farmers were contented to engage in farming for pleasure and hobby. Young farmers were also continuously tempted to seek jobs in the city. These factors contributed to the decrease in the quality of labor for farming.

Small farming structure. Land price and rent cost are generally so high in peri-urban areas. Therefore, it is now difficult for farmers to get large farmlands. Especially in Korea, many companies and investors owned much of the land in peri-urban areas. These investors owned land expecting rising land price. Therefore, they have little interest in improving agricultural productivity. Because investors owned much land in peri-urban areas, it is so difficult for farmers to enlarge their farmlands. Therefore UPA has been mostly practiced in small scale ( Fig. 3(1100)).

It is also difficult for farmers in peri-urban areas to increase the size of farmland because they have little money and land price is so high. Consequently, the structure of farming remained small, leaving little opportunity for the development of UPA.

Development Strategies for Upa in Korea

Recent Crisis in Korean Agriculture

Korean agriculture is currently faced with enormous crisis. As a result of the expansion of agricultural imports, competitiveness of Korean agriculture is sharply declining. The price of Korean rice is four to five times lower than that of other countries. Since 2006, imported rice has started to enter the country and sold to consumers directly. Even though the volume of imported rice is yet small, many Korean farmers believe it will shock the market enormously. Rice farming is very important to Korean agriculture. Rice farmers occupy 73.7% of all Korean farms. Rice production value is 32.5% of the total agricultural production. Therefore, expansion of rice imports will devastate Korean agriculture enormously. Many Korean farmers have serious worry about this new development.

Recently, the Korean government has been negotiating with the US on a free trade agreement (FTA). Many Korean farmers worry that a FTA would have negative effects on Korean agriculture. Based on a research by the Korean Agricultural Research Institute, such an agreement would result to a reduction of about 30% of total agricultural production. Korean agriculture will face many difficulties in this situation. In terms of UPA, following are some measures to alleviate the impact of FTA.

Development Strategies for Upa

Re-conceptualizing urban/peri-urban agriculture. UPA's development started at the beginning of industrialization, but as the economy continues to grow rapidly, UPA begun shrinking. The rise in land price, as well as the development in transportation and agricultural facilities and the decrease of farmers' interests in farming all contributed to this decline. In particular, the increase in agricultural imports became crucial factors to the crisis in UPA. Because of high input cost, UPA could not compete with imported agricultural products in terms of price.

New strategies are needed to revitalize UPA. These strategies will have to differentiate UPA with traditional agriculture, since it could not compete with imported agricultural products nor with domestic agricultural products cultivated in the rural areas.

The new strategy is to re-conceptualize UPA based on current conditions and trends, such as connecting farming in peri-urban areas with such concepts as environment, green tourism, and food safety and quality. As consumers' interest for health, agricultural product safety, and environmental issues increases, this strategy is deemed to revitalize UPA, giving farmers new opportunities for increased income. Moreover, it will give a new foundation for city and rural communities to cooperate together for their mutual benefits. Korean agricultural cooperatives are particularly doing a great role in these areas.

Mutual contract between metropolitan city and farmers in peri-urban area. Recently, there are some cases of UPA making developmental opportunities through cooperation with metropolitan city. City dwellers want clean drinking water, so they want agricultural farming to be conducted in an environmentally friendly manner in peri-urban areas where drinking water is flowing. City dwellers do not want farmers to use much agricultural chemicals and fertilizers in these areas, because these materials will contaminate their drinking water. Hence, citizens are willing to support farmers if they change their way of farming to environmentally friendly methods. Mutual contract between citizens and farmers is occurring under this background. The typical case is the Paldang project. This project started in 1995 between the Seoul Metropolitan Government (SMG) and the farmers of Paldang area, the tap water source of Seoul.

Farmers in Paldang area have been in trouble with strict restriction on farming and property rights since the area was designated as an area for tap water source protection by the government. But the quality of city water has been a public concern for SMG as well as for tens of millions of residents in Seoul and neighboring area. Agriculture, including livestock husbandry, in the tap water area has been considered one of the major sources of tap water pollution. There seems to be a conflict between farmers and city residents.

In February 1995, a proposal to compromise the conflict was made by the National Agricultural Cooperative Federation (NACF) to SMG. The plan was to promote mutual benefits through cooperation between both sides. The government provides economic compensation for sustainable farming for farmers, and environmentally friendly practices then provide environmental benefits for city residents. Finally, an agreement was made in May 1995 between SMG and NACF that mutual cooperation will be made to foster sustainable farming in the Paldang tap water source area.

The Paldang project aims to foster environmentally friendly farming in the Paldang tap water source area. The objectives of the project are manifold. First, it seeks to improve quality of city water in favor of tens of millions of residents in Seoul through protecting tap water source area from farm-originated contamination. Second, it hopes to encourage local farmers to engage in sustainable farming practices with lower environmental burden by providing economic incentives and education programs. Third, it aims to ensure environmental benefits for producers in terms of sustainable farming and consumers by improving quality of farm products.

The Paldang project is composed of three major programs: education, financing, and marketing programs. The NACF has been in charge of conducting the education program in collaboration with outside specialists. Participants are also encouraged to make and join one of the cooperative farming groups that pursue sustainable farming by adopting new technology, pursuing relevant inputs, and marketing their quality products.

Financial support in terms of low interest loans are given to participant farmers by agricultural cooperatives. The financial subsidy from the SMG makes it possible for agricultural cooperatives to make loans at favorable conditions such that a maximum of 40 million won (about US$42 thousand) is credited to farmers at an interest rate of 5% per annum for a period of seven years with a grace period of two years. The difference in market rate and loan rate, amounting 7.5% in 1995, was compensated by the financial subsidy from SMG. Such a financial program played an important role in encouraging farmers to join the project at least in the beginning stage. Financial incentives also help farmers invest relevant capital equipment for sustainable farming. It is also noted that the financial costs are paid by taxpayers/residents in Seoul who are beneficiaries of quality city water as well as quality farm products.

The marketing program is considered to be crucial for the success of the project. The agreement between SMG and NACF specifies a common condition towards market promotion. Special grocery stores are to operate for marketing quality farm products in the Seoul area, where store sites are provided by SMG and store operations are handled by NACF. NACF is committed to provide market outlets for participant farmers through wholesale market, retail market, and direct marketing.

During the last ten years or more, the project has shown quite a successful performance in terms of farmer participation, environmental benefits, and marketing and farm income. The overall statistics show that the project began with 638 farmers in 1995, the first year of the project. In 1999, the fifth year of the project, participants increased to 1,145 farmers. According to an interview survey with the farmers, about 50% of participating farmers is selling their products at a premium on their quality. As for rice, 29% of respondents are reporting that more than 20% price premium is realized for their quality products. As for vegetables, 32% of farmers are enjoying price premium of 20% or higher for their quality products. Others are marketing their products at normal market prices.

Connecting green tourism to agriculture. The most important merit of UPA is that it is close to the big city. Recently, many farmers introduced green tourism vigorously using this merit. The representative examples are Farmstay and Weekend Farm.

Farmstay means that city dwellers visit and stay in the farm during the holidays. Many parents of students who live in the city are concerned that their children do not have any opportunity to enjoy and appreciate nature. The parents are also worried by the fact that their children indulge too much in computer games. As this social recognition has become widespread, interest about green tourism is also becoming widespread.

Farmstay is different from other tourism. It connects tourism with traditional culture, experience of farming or rural communities' life style, and rest and recreation at the same time ( Fig. 4(1149)). Children who visit Farmstay experience rural community's traditional culture and play. They get close to the soil, and experience harvesting of fruits and vegetables. They experience natural playing provided by mountains and brooks. They are awaken of the value of agricultural products and become full of emotional happiness experiencing these processes. The parents enjoy that their children can have these experiences.

Farmstay business is providing various income opportunities to farmers. Firstly, farmers earn money from lodging charge, and from selling meals and agricultural products to visitors. Farmstay gives new market to farmers for agricultural products.

The number of Farmstay in the country is increasing day by day. There were 13 Farmstays in 1999, and the number increased to 124 in 2003. Agricultural cooperatives are doing a great role in developing Farmstay. Primary cooperatives are providing credit to farmers who want to engage in Farmstay business. They are also giving information to farmers related to green tourism, as well as opportunities for farmers to join field trips.

On the other hand, Weekend Farm gives city dwellers an opportunity to visit the farm and grow some agricultural products for themselves during the weekend. Weekend Farms also have been increasing rapidly, especially when the 40-hour work system was introduced in 2004 in which workers can now enjoy two holidays in a week. Many workers visit Weekend Farms with their children. Parents and children simultaneously experience growing and harvesting some agricultural products. Parents believe that their children can learn much from experiencing these processes.

Korean highways are prone to traffic jams, such that it takes too much time to get out of city. Because of this, it is difficult to place Weekend Farms in remote areas. Peri-urban areas are therefore favorable for Weekend Farms. Currently, many Weekend Farms, as well as Farmstays, now exist in peri-urban areas ( Fig. 5(1167)). This proves that green tourism has become a new opportunity for the development of UPA.

Role of agricultural cooperatives in the development of UPA. In Korea, there are about 1,300 primary agricultural cooperatives. Cooperatives supply agricultural materials, credit, and marketing service for agricultural products. Recently as agricultural crisis increases because of the expansion of imported agricultural products, the role of agricultural cooperative has become more important.

Cooperatives in peri-urban areas are exerting various efforts to develop competitiveness of agricultural products cultivated in their area. The most general method is to improve quality of agricultural products. Cooperatives are now focusing on development of brand. Cooperatives develop brand for themselves and manage the quality of agricultural products strictly to sustain brand value. They differentiate incentives according to quality level of agricultural products supplied by farmers. They also try to strengthen safety and healthful function of agricultural products. These efforts contribute to the increase of agricultural product value.

Cooperatives are also trying to enlarge direct transaction between farmers and consumers. Direct transaction is favorable for market expansion and guaranteeing high price of agricultural products. Particularly, NACF is implementing a movement to facilitate interchange between city and rural areas. The most representative case is the movement of One Company One Rural Village (OCOR). OCOR means that one company and one rural village tie together and establish sisterhood relationship. This movement started several years ago as a means for companies and city dwellers to support rural communities. Company workers establish sisterhood relationship with rural villages and sometimes visit the village to help in farming, harvesting, and other farm works. Company workers also buy agricultural products from the village. It is certainly helpful in expanding the marketing channels for farmers. About 9,000 OCOR sisterhood relationships have been established by March 2006, and agricultural cooperatives have been playing a key role in the promotion of the OCOR movement.

Agricultural cooperatives have been doing a great job in terms of developing the Farmstay business. They are giving credits to farmers who want to start this business, supplying information about green tourism, and providing support propaganda for the village.

Agricultural cooperatives particularly take part in special businesses to provide domestic agricultural products for school meals. This business aims to promote agricultural products cultivated in domestic area as ingredients for school meals, as parents of students want their children to eat good foods in school. Environmentally friendly agricultural products cultivated in domestic areas are preferred for this purpose. As the interest on food safety increases, the businesses continue to expand. Now, about 198 agricultural cooperatives are participating in this business. They are providing 3,399 schools with rice, vegetables, fruits, meats, and other processed agricultural products cultivated domestically. Many Korean farmers expect that this business will contribute in securing the domestic market for agricultural products.

Improving value added of agricultural products. Korean farmers continuously exert efforts to improve the quality of their agricultural products to compete with imported agricultural products. Because of high land price and high labor cost, it is difficult for Korean agricultural products to achieve competitiveness in terms of price. Therefore, many Korean farmers think that raising the quality of produce is the best way to strengthen competitiveness.

One of the means to raise the quality of agricultural products is to adopt environmentally friendly farming. Recently, consumer's interest for health and safety is rapidly increasing. Therefore, the market for environmentally friendly farming is expected to expand as well. Environmentally friendly farming has been practiced by farmers primarily by reducing the use of agrochemical fertilizers, and instead using environmentally friendly methods such as growing feed crops on paddy areas, which are used as organic fertilizer. Farmers also use environmentally friendly fertilizers like germanium to paddy field.

Other ways to develop quality of agricultural products is to add or develop special or specific functions of foods. The most common way is to inject some functioning materials to the crop. For example, rice farmers coat the surface of rice with materials known as healthful to humans.

In the meantime, many farmers use information communication system to develop value added of agricultural products. The number of farmers who can use internet service has been increasing rapidly in Korea. Many farmers growing flowers in peri-urban areas are now using internet service effectively in terms of selling and quick delivery service. Consumer demand for flowers is especially high on memorial day. Peri-urban agriculture is located where one can use quick service, and it gives new opportunity to develop value added of agricultural products.

Conclusion

Although UPA in Korea has faced serious challenges, significant developments have been achieved and new insightful strategies have been formulated to overcome adverse situations. In summing up the development of UPA in Korea, at least three important points are emphasized. Firstly, UPA in Korea has contributed much to the expansion of the concept of agriculture _ from its basic function of food production to its multi-functionality role. This is consistent with the definition of UPA which recognizes the value of agriculture beyond production, and in terms of the externalities it provides such as environmental protection, resource conservation, economic contribution, and promotion of agricultural traditions. This trend will be much stronger as the need to rearrange resources in a national economy becomes more urgent in the midst of restructuring and urbanization. Secondly, the developmental strategies of UPA can be developed by and in accordance with the interests of the main stakeholders, namely the farmers themselves, the government, civil society, and cooperatives; and by establishing a viable network system between urban and rural communities. For instance, city dwellers and farmers near Seoul in Korea developed UPA along their central river streaming through the metropolitan city by signing a long-term cross-regional contract between the city government and the local farmers with the assistance of agricultural cooperatives. In local areas, local governments and farmers have made other solutions which can stabilize the UPA, promote environmentally friendly farming, and improve farmers' household economies by building tourist attractions linking urban areas to remote rural areas. In this process, the efforts of civil movement associations to maintain the networks between urban and rural areas are as remarkable as securing information technology (IT) networks in virtual space. Last but not the least, in the rapid change of local and global markets, technological requirements of UPA are likely to be concentrated on market-oriented technologies which will enable farmers to separate agricultural markets based on their own specific values. At present, local brands are continuously being developed to cater to value-added marketing behavior. In line with the pace of changes in the national economy, more UPA technologies suitable to maintaining local economies and farmers' household economies must be developed.

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Index of Images

Figure 1 Comparison between Number of Farmers and Amount of Export in Korea.

Figure 1 Comparison between Number of Farmers and Amount of Export in Korea.

Figure 2 The Trend in Farmland Price in Peri-Urban Areas of Korea.

Figure 2 The Trend in Farmland Price in Peri-Urban Areas of Korea.

Figure 3 Number of Farmers by Farmland Scale.

Figure 3 Number of Farmers by Farmland Scale.

Figure 4 The Various Programs of Farmstay.

Figure 4 The Various Programs of Farmstay.

Figure 5 Distribution of Farmstay in Korea.

Figure 5 Distribution of Farmstay in Korea.

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