○ On September 9, Gyeonggi Province Governor Lee Jaemyung and Gyeonggido Assembly Chairman Jang Hyun-gook announced a limited local currency distribution plan to revitalize the local economy during the Chuseok holiday.
○ Starting September 18 (scheduled), the province will provide an additional 15% incentive on top of a 10% basic incentive for Gyeonggi local currency reloads of KRW 200,000.
– KRW 20,000 to be provided immediately upon reloading KRW 200,000 after September 18; additional KRW 30,000 to be provided if all KRW 200,000 is spent by November 17
○ Targets all provincial residents with local currency cards or apps; to be provided until exhaustion of the KRW 100 billion budget
– Approximately 3.33 million people will benefit from the KRW 30,000 paid in local currency per person; retails sales expected to increase by about KRW 830 billion.
○ The Gyeonggi Provincial Government accepts the Gyeonggido Assembly’s proposal to launch an economic revitalization project using local currency incentives.

The Gyeonggi Provincial Government and the Gyeonggido Assembly will provide a limited local currency (consumption support) fund that offers an unpresented 25% incentive, enabling purchases totaling KRW 250,000 on reloads of KRW 200,000, so as to revitalize the local economy during the Chuseok holiday. This is the Gyeonggi Provincial Government’s second economic policy initiative to offset the economic impact of the COVID-19 epidemic following the Gyeonggi Disaster Basic Income payments made in April.

Gyeonggi Province Governor Lee Jaemyung, Gyeonggido Assembly Chairman Jang Hyun-gook, and Gyeonggido Assembly Democratic Party Representative Park Geun-cheol held an emergency press conference at the Gyeonggi Provincial Government complex on the morning of September 9 to announce this plan to provide a limited local currency fund and incentive to revitalize the local economy during the Chuseok holiday.

Governor Lee said, “Small business owners and small-scale sole proprietors, who serve as the capillaries of public livelihood, have been directly affected. At this rate, we will be unable avoid extreme income polarization, consumption demand drops, and a vicious economic recession cycle. Aware of the crisis, the provincial government and the provincial assembly have devised measures to promote consumption using pre-Chuseok local currency incentives to revitalize the local economy for small businesses that face an extreme crisis.”

As a result, from September 18 (scheduled), Gyeonggi-do will provide an additional limited KRW 30,000 (15%) on top of the basic incentive of 10% for local currency reloads of up to KRW 200,000. This equates to the provision of a KRW 20,000 (10%) advance incentive on local currency reloads of KRW 200,000, as well as an additional KRW 30,000 (15%) incentive if the reloaded amount is spent within two months, for a total incentive package valued at 25% or KRW 50,000. If less than KRW 200,000 is spent, the 15% incentive will not be applied, with KRW 30,000 being the incentive cap for any consumption in excess of KRW 200,000.

The limited local currency fund will be provided on a “first-come, first-served” basis to all provincial residents with local currency cards or apps until the budget is exhausted. To receive the limited local currency incentive, residents must spend at least KRW 200,000 by November 17 at the latest, based on the amount spent after September 18.

The basic pre-incentive (10%) is provided immediately after reloading, as before, but the limited consumption support incentive for increased consumption will be paid in local currency on October 26 or November 26 after consumption of KRW 200,000 or more is confirmed. The post-consumption support incentive payment (15% or KRW 30,000) will expire one month after the date of receipt, and thus must be spent within the given period.

The budget that Gyeonggi-do has allocated for provision of the limited local currency incentive amounts to KRW 100 billion; if executed as planned, approximately 3.33 million local currency users in Gyeonggi-do will benefit. The province expects that the retail sales of small and medium-sized businesses will increase by up to KRW 830 billion, and the resulting production inducement effect will have a resuscitation effect on the local economy.

The limited local currency initiative took shape when the Gyeonggido Assembly proposed a project to revitalize the local economy for small business owners negatively impacted by COVID-19. The provincial government devised the limited local currency incentive project to revitalize the local economy during the Chuseok holiday after consideration of provincial assembly input and consulting with the legislative body to secure the required funding of KRW 100 billion.

Gyeonggido Assembly Chairman Jang Hyun-gook said, “COVID-19 has resulted in a local economic recession, making it difficult for small business owners and small-scale sole proprietors to make ends meet. Through discussions with the provincial government, we have decided to provide a limited local currency incentive to combat this crisis.” He added, “The KRW 30,000 incentive may seem small for each individual, but with the combined power of provincial residents, it will generate a consumption effect of KRW 1 trillion. We look forward to your active involvement in reviving the economy by applying for the limited local currency incentive.”

Gyeonggido Assembly Democratic Party Representative Park Geun-cheol said, “According to a survey of ordinary small business owners nationwide conducted by the Korea Federations of Micro Enterprises, the situation is so dire that 60% of the respondents indicated their sales have fallen by 90% since the resurgence of COVID-19.” He added, “We believe that the provision of the consumption support incentive will play a pivotal role in returning circulation to the cut-off capillaries of the economy.”

Gyeonggi Province Governor Lee Jaemyung said, “There may be criticism that consumption-boosting policies will hinder epidemic control, but economic control is just as important as epidemic control itself. Even during a war, consumption must continue to maintain a minimum lifestyle, and merchants must sell goods to make ends meet.” He added, “Since this is for economic revitalization as well as epidemic control, please strictly follow the preventive guidelines in your consumption activities to demonstrate that both economic and preventive measures are compatible with each other.”