The South Korean government is contemplating on adopting the coupon program in a bid to support the nation's low-income households which are hard struck by the economic recession, South Korea's Korea Herald said Tuesday.
Experts said the total amount of coupons issued would be worth at least 1 trillion won (668.
8 million U.
dollars), according to the Korea Herald.
They said that as the Ministry of Strategy and Finance plans to draw up a 10 trillion won, or 6.
7 billion U.
dollars, supplementary budget, it would spend at least 10 percent of the budget on the coupons, the Korea Herald added.
The ministry plans to seek an approval on the supplementary budget from the National Assembly in March.
The coupon program was first proposed by Finance Minister Yoon Jeung-hyun, who said during an interpellation session at the National Assembly that he was giving a thought on issuing coupons to support low-income households.
After attending the meeting of finance chiefs of ASEAN+3 in Thailand, he told the press that he had requested the Ministry of Health, Welfare and Family Affairs to make sure the right people would be endowed the government subsidies through a proper distribution channel.
"Without revamping the deliverance channel, effects of coupons like food stamps will be greatly limited," Yoon said.
Experts generally agree on the positive effect that consumption coupons will bring to the domestic demand, at least for the short- term, the Korea Herald said.
However, there still remain additional problems such as how to define "low-income" households or whether to limit the target of coupons only to low-income families.
The government must also work out on details of the program, such as how it can distribute the coupons, how long the coupons should be available and how it could prevent people from making fake coupons, said Jeon Byung-mok, a research fellow of the Korea Institute of Public Finance.