S.K. becomes more eco-friendly

Market seeks 26-fold jump of products easy on environment

With concerns over the environment increasing, domestic industries have been working to produce more ecologically-friendly products.

As of the end of last month, the South Korean market was offering for sale 4,420 of such eco-friendly goods earning the "Eco Label" stamp of approval from the government, a 26-fold increase in just six years, compared to the 169 items bearing the label in 2000. The number of products receiving the GR mark granted to excellent goods made out of recycled materials, has sharply increased, as well, with 291 products of 229 companies from 84 items from 72 firms in 2000.

Consumers still want more choice in the eco-friendly market, however, especially in terms of design, as eco-friendly sections at major retailers do not exactly leave customers glutted with variety.

This is because an economy of scale has not yet been materialized in the market of environmentally-friendly products, as demand remains small overall. But because of eco-friendly products’ high prices, customers balk at buying them, creating a vicious cycle in which the market does not expand enough to lower the cost to consumers.

To correct this, the government has since July last year made it obligatory that public institutions purchase environmentally-friendly goods. Under government measures, public institutions purchased about 434 billion won (US$435 million) worth of eco-friendly products in 2005, a sharp increase from about 76 billion won in 2004.

The size of the market has been expanding, owing to a social atmosphere in which people began to take issue with new environmental problems such as the so-called "sick house syndrome" - a kind of environmental sickness caused by chemicals used in construction - and to instead pursue a so-called "well-being" lifestyle.

With the spread of social responsibility and eco-friendly management throughout South Korean industries, companies, as well, have increased the purchase of ecologically sound goods. About 30 major domestic enterprises, including Samsung Electronics, LG Electronics, Hyundai Motors, POSCO, and SK Telecom, have signed a "purchase eco-friendly products first" agreement with the Ministry of Environment.

The ministry anticipates the size of the related market will expand to 16 trillion won by 2010 from 3.2 trillion won in 2005, thanks to efforts to expand the sale of eco-friendly products.

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