Because of recent surgesin international energy prices, many countries are faced with problems of energy demand when pursuing economic policies. Nonetheless, energy and electricity subsidies are still being used to allay the financial burden of househ...
Because of recent surgesin international energy prices, many countries are faced with problems of energy demand when pursuing economic policies. Nonetheless, energy and electricity subsidies are still being used to allay the financial burden of households and industry. Currently, OECD countries are spending more than 400 billion US dollars annually in subsidies, making up two thirds of subsidies globally. This is twice that of non·OECD countries and is usually concentrated in areas such as agriculture, energy, electricity, transportation,and manufacturing. Of these, it is estimated that subsidies provided to the energy and electricity sectors amount to 100 billion US dollars. International organizations such as the OECD, IEA and UNEP are discussing green tax reform and reforms in subsidies to the energy and electricity sectors in accordance with climate change agreements. In particular, OECD countries are deliberating on discarding environmentally·harmful subsidies, focusing on the energy and electricity sectors, and on whether they contribute to environmental degradation. They are also discussing different ways of overcoming obstacles that inhibit changing or doing away with environmentally·harmful subsidies and on introducing environmentallyfriendly subsidies. In the Republic of Korea, subsidies are being provided in various economic sectors, including agriculture and fisheries, energy and electricity, transportation, steel and shipbuilding. This is currently beinghotly debated in international trade relations. However, there is still little research being carried out on subsidies related to the environment, with only general estimates of subsidies that harm the environment in the areas of transportation, energy, and water. (Roh, Sang Hwan, et al.; 1997, 1998). Also, it is necessary that more research be conducted on subsidies that expedite the development and supply.