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Korea’s Finance Minister Warns Wage Increases May Fuel Inflation

  • Korea engaged in minimum-wage negotiations amid rising prices
  • Bank of Korea concerned on wage-price spiral amid rate hikes

South Korea’s Finance Minister Choo Kyung-ho warned against wage increases that may fuel inflation, calling on top business executives to refrain from raising pay competitively.

Some technology companies and conglomerates have been boosting paychecks quickly, spurring concerns that other businesses and industries may follow suit, Choo said Tuesday at a local business association, according to his office. Such pay hikes not only worsen inflationary pressures that weigh on business competitiveness but also widen wage gaps between small and large businesses and create a sense of inequality and deprivation, he said.