"Too Early" vs "Necessary for Economy" Consumer Coupon Issuance, COVID Concerns Controversy

Government Offers 3,000~8,000 Won Discount Coupons for Exhibitions, Performances, and Cinemas
Citizens Say "Could Spread COVID-19" vs "Individuals Just Need to Be Careful"
Experts Say "Consumption Coupons Don't Help Much in Current Economic Situation"

The government has prepared measures to stimulate consumption, such as providing discount consumption coupons, to alleviate the economic downturn caused by the impact of the novel coronavirus infection. Photo by Yonhap News

[Asia Economy Reporter Kim Suwan] The government’s decision to resume the distribution of consumer discount coupons, which had been suspended since last August due to the spread of the novel coronavirus infection (COVID-19), has sparked controversy. There are concerns that the resumption of coupon issuance could potentially lead to an increase in COVID-19 cases.

Previously, this policy was proposed as a measure to support industries severely affected by strengthened social distancing and to revitalize the economy. However, it faced criticism for potentially triggering a resurgence of COVID-19 and was halted before it could properly begin.

As a result, some argue that the coupons are necessary for economic recovery, intensifying the conflict surrounding the issue. Experts predict that the economic effects of issuing coupons could be negative and that concerns over the spread of COVID-19 might actually increase.

The Central Disaster and Safety Countermeasures Headquarters (CDSCH) announced on the 18th that it will resume the consumer discount coupon support project for the exhibition, performance, movie, and sports sectors to support industries severely affected by strengthened social distancing and to revive the stagnant economy of ordinary citizens.

The consumer discount coupons will be operated by investing 85 billion won of government funds secured through supplementary budgets, providing partial discounts or reimbursements on expenses incurred during consumption.

Among the eight sectors eligible for consumer discount coupons?exhibitions, performances, movies, sports, accommodation, travel, dining, and agricultural and marine products?the coupons being resumed this time cover four sectors: exhibitions, performances, movies, and sports.

The government plans to start gradually with the performance, movie, and sports sectors, which are considered safe and manageable from a quarantine perspective. It will also review the timing for resuming coupons in other sectors not included in this support, depending on the infection spread situation.

Accordingly, consumer discount coupons will be available starting with exhibitions and performances on the 22nd, movies from the end of October, and sports from early November.

Meanwhile, concerns remain that consumer coupons could lead to the spread of COVID-19. In response, the government will impose obligations on facility operators applying the discount coupons to comply with core quarantine rules such as capacity limits, mask-wearing, and disinfection. Consumers will also be issued coupons only if they agree to comply with quarantine rules.

Photo by Yonhap News

Given this situation, debates continue among citizens over the resumption of consumer coupons. Some worry that it could loosen quarantine measures and cause a rapid increase in confirmed cases.

Office worker Kim (29) said, “When the consumer coupons were first introduced, confirmed cases exploded, and it was eventually stopped. Even though social distancing has been adjusted to level 1, small-scale cluster infections continue to occur. Such policies only reduce vigilance.”

He added, “With the change of seasons now and concerns about a cold epidemic, resuming consumer coupons seems premature. It looks like complacency just because confirmed cases have slightly decreased. Encouraging consumption when the spread is not fully controlled is a policy that does not help quarantine at all.”

Although the daily average number of new COVID-19 cases remains in double digits recently, vigilance cannot be lowered. While there is no large-scale spread yet, cluster infections continue in vulnerable facilities such as nursing hospitals and rehabilitation hospitals.

According to the CDSCH, the average daily number of new locally transmitted cases from the 4th to the 17th of this month was 61.8, a decrease of 4.7 from the previous two weeks (66.5). However, in non-metropolitan areas, sporadic infections continued in places like Busan and Daejeon, with a slight increase from 14.7 to 15.2.

Photo by Yonhap News

On the other hand, some argue that consumer coupons will help the economy, citing that social distancing has been adjusted to level 1 and the COVID-19 situation is more stable than before.

There is also a view that restricting consumption activities for quarantine purposes could cause long-term economic deterioration.

Another office worker Lee (33) said, “How long can we keep blocking outdoor activities? Consumers are closing their wallets due to social distancing, and self-employed businesses are dying. We need policies like this to revive the economy.” He added, “If individuals strictly follow quarantine rules, there should be no problem. The government is pushing this policy because it expects to manage it.”

Some point out that other measures for economic revitalization would be more helpful, arguing that consumer coupons alone cannot recover the economy worsened by COVID-19.

Experts predict that issuing consumer coupons will not have a positive effect on economic revitalization.

Professor Kim Taegi of Dankook University’s Department of Economics said, “The purpose of the coupon policy is to stimulate consumption and revive the economy, but given the current economic situation, it will not help. It could rather worsen public finances. Especially, as some fear, it could increase the possibility of a COVID-19 resurgence.”

He added, “Tax policies such as reducing the special consumption tax on automobiles would be more helpful for economic recovery. Since the spread of COVID-19 continues, alleviating COVID-19 anxiety is the way to revive the economy.”