South Korea may soon see a new round of economic stimulus, including 250,000 KRW consumer vouchers for every citizen, as part of the Lee Jae-myung administration’s supplementary budget plan. But what is included in this proposal, and why is it significant for the Korean economy?
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| Lee Jae-Myung administration's economic stimulus plan |
The “250,000 KRW National Relief Fund” is a proposed universal payment to help boost consumer spending and support economic recovery. Originally introduced by the Democratic Party in February 2025, the plan aims to distribute:
- 250,000 KRW in local currency (지역화폐) to every South Korean citizen
- An additional 100,000 KRW for low-income households, such as basic livelihood recipients, near-poverty groups, and single-parent families
That means up to 350,000 KRW per person for those in the most vulnerable groups.
The total cost of this measure is estimated at 13.1 trillion KRW, and the government hopes it will revitalize household consumption and strengthen local economies.
When Will the Budget Be Passed?
According to senior Democratic Party officials, the second supplementary budget (추가경정예산안) is targeted to pass the National Assembly by July 2025, possibly as early as this month.
President Lee Jae-myung is directly overseeing the Emergency Economic Task Force, fast-tracking the plan to address slowing economic activity and falling tax revenues. The budget scale is expected to exceed 20 trillion KRW.
Why Use Local Currency?
The relief payments will likely be issued in local currency or regional gift certificates (지역사랑상품권). These stimulate spending within communities and support small businesses.
Additionally, the government plans to support 2 trillion KRW in subsidies for local currency discounts. Here's how it works:
- If local governments issue 20 trillion KRW in local currency,
- The central government will cover the 10% discount (2 trillion KRW),
- Consumers can buy a 100,000 KRW certificate for only 90,000 KRW.
This is a proven way to boost regional economies while offering real savings to consumers.
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| South Korea's President Lee Jae-myung |
What About Small Business Debt Relief?
Another key component of the extra budget is debt relief for small business owners—a major campaign promise from President Lee.
In February 2025, the Democratic Party proposed 2.8 trillion KRW in support for small businesses and SMEs, particularly those affected by:
- The December 2024 political crisis (12·3 계엄 정국)
- The temporary closure of Muan Airport
- Ongoing pandemic-era financial burdens
The Financial Services Commission is also considering expanded debt forgiveness programs, similar to the 2013 initiative under the Park Geun-hye administration, which reduced long-term debt for over 330,000 borrowers by up to 50%.
Will the Relief Be Universal or Targeted?
While the Democratic Party favors universal payments, they are open to targeted support depending on budget capacity.
Jin Sung-joon, the party’s policy chief, said on MBC Radio: “Universal support boosts consumption, but selective support for low and middle-income groups may be more feasible given current fiscal constraints.”
This means the final budget may prioritize low-income households if full universal support is not financially viable.
Learn Korean Through This News
Korean Text:
“이재명 정부와 더불어민주당이 이르면 이달 중 늦어도 7월 안에 2차 추가경정예산안 편성과 통과를 목표로 하고 있다. ‘전 국민 25만원 민생지원금 지급’안이 검토되는 가운데 지역화폐(지역사랑상품권) 발행 지원, 소상공인 빚 탕감 정책 등을 추경안에 담을 것으로 보인다.”
Key Vocabulary:
- 이재명 정부 – Lee Jae-myung administration
- 더불어민주당 – Democratic Party of Korea
- 이르면 – as early as
- 이달 중 – within this month
- 늦어도 – at the latest
- 추가경정예산안 – supplementary budget bill
- 편성 – formation, compilation
- 통과 – passage, approval
- 목표로 하다 – to aim for
- 전 국민 – the entire nation
- 민생지원금 – livelihood support payment
- 지급 – payment, distribution
- 검토되다 – to be reviewed, considered
- 지역화폐 (지역사랑상품권) – local currency (local love gift certificate)
- 발행 – issuance
- 소상공인 – small business owners
- 빚 탕감 – debt relief
- 추경안 (추가경정예산안) – supplementary budget bill
- 담다 – to include
Grammar Notes:
- 이르면 A, 늦어도 B → A structure to indicate a time range: as early as A, at the latest B: 이르면 이달 중, 늦어도 7월 안에 = as early as this month, no later than July
- ~을/를 목표로 하다 → Used to express an aim or goal: 편성과 통과를 목표로 하고 있다 = aiming to compile and pass
- ~는 가운데: This means “in the midst of” or “while.” Often used in news reporting to indicate background context.
- ~으로 보이다: "It appears that..." – a soft way of making a prediction or guess.
Translation:
“The Lee Jae-myung administration and the Democratic Party of Korea are aiming to compile and pass the second supplementary budget as early as this month, and no later than July. While the idea of providing a 250,000 won support payment to all citizens is being considered, the supplementary budget is expected to include support for issuing local currency, debt relief policies for small business owners, and more.”
References: hani news, daum news, yonhap news, khan news
Keywords
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