[Report] "Is There a Reason to Refuse?" vs "Just a Temporary Effect" 2nd Disaster Relief Fund, Listening to Market Sentiment

'Local Commercial Vitality' vs 'Skeptical About Actual Effect'... Public Opinion Divided
On the 4th, Poll Shows 51.1% Support Additional Payments... Barely Over Majority

Morning of the 23rd, entrance of Gwangjang Market, Jongno, Seoul. / Photo by Juhyung Lim, Intern Reporter skepped@asiae.co.kr

[Asia Economy reporters Seunggon Han and intern reporter Juhyung Lim] "Second disaster relief fund? Why would anyone refuse money?", "Honestly, I don't want to receive it. Who knows how much tax they'll take later."

On the morning of the 23rd, citizens met at Gwangjang Market in Jongno, Seoul, expressed mixed opinions about the possibility of a second emergency disaster relief fund payment. Some merchants expressed expectations that it would breathe new life into the local commercial district, which had lost vitality after the COVID-19 pandemic, but some were skeptical about the actual effectiveness compared to the cost of providing the support.

That morning, the Gwangjang Market visited by reporters was quiet with few people. Mr. A, in his 60s, who runs a clothing store in the middle of the market, said, "Business was quite good for about a month after the first disaster relief fund was paid, but now people are not coming again," adding, "Who would refuse money? If they give support again, it would be good for merchants like me."

Mr. B, also in his 60s, who deals in dried seafood, said, "It's a severe recession now, so we have to survive first," and added, "If it's a policy to help small business owners, I am in favor."

On the other hand, some merchants said they did not feel the benefits of the existing disaster relief fund. Mr. C (58), who sells food in the food alley, said, "When people get a lump sum, they buy clothes or expensive meals, but they don't come to local markets to use the disaster relief card," and raised his voice, "That money should rather be used to revive the struggling local economy."

According to an actual survey, from the perspective of small business owners, the effect of the disaster relief fund was a short-term effect rather than a long-term one.

According to data from 'Korea Credit Data,' which manages card payment information of about 600,000 small business owners nationwide, during the first week of June (1st to 7th), which was the fourth week after the disaster relief fund payment, the average card sales of small business establishments nationwide recorded 98 compared to 100 for the same period last year.

After that, nationwide small business card sales showed a gradual recovery in the second week of May (11th to 17th), when the disaster relief fund payment began, but from June, a month after the payment, it returned to a downward trend. Although the economic stimulus effect of the disaster relief fund was confirmed, concerns arise that the overall market vitality may only be a 'flash in the pan' rather than sustained.

On the morning of the 23rd, a passage in the food alley of Gwangjang Market in Seoul appears quiet.
Photo by Intern Reporter Juhyung Lim skepped@asiae.co.kr

As a result, opinions among small business owners about the second emergency disaster relief fund are divided. According to a poll conducted by the public opinion research firm 'Realmeter' on the 4th, 51.1% of respondents supported the payment of the second disaster relief fund, slightly exceeding the majority. Those opposed to the payment, citing concerns about the national budget burden, accounted for 40.3%, and 8.6% said they did not know.

While merchants' opinions are divided, consumers expressed willingness to increase consumption if additional disaster relief funds are provided, but their reactions to supporting the second disaster relief fund payment were mixed.

Consumer D (63), met at the market that day, said, "Honestly, I spent almost all of the first support fund on herbal medicine," and added, "If they give (the second disaster relief fund), I am willing to spend it in the market this time."

On the other hand, E, in their 40s, said, "Honestly, I don't want to receive it," and lamented, "In the end, it will all be taken away as taxes. Who knows how much they'll take later."

On the 14th of last month, a notice indicating the availability of emergency disaster relief funds is posted at a store in Namdaemun Market, Jung-gu, Seoul. / Photo by Yonhap News

Given this situation, voices for and against additional disaster relief fund payments are sharply divided in the political sphere. Earlier, Gyeonggi Province Governor Lee Jae-myung officially requested the government on the 2nd to prepare a supplementary budget for the second disaster relief fund, totaling 10.3685 trillion won.

Governor Lee emphasized the importance of additional disaster relief fund payments during a Q&A session at the Gyeonggi Provincial Assembly on the 22nd, saying, "From the month after the support funds are almost exhausted, cries will start to be heard among the people," and added, "If the central government's second disaster relief fund payment is difficult, Gyeonggi Province will consider paying independently."

On the other hand, Kim Kyung-soo, Governor of Gyeongsangnam-do, appeared on YTN Radio's 'Lee Dong-hyung's News Face-off' on the 16th and said, "The first support fund was paid to break the vicious cycle of reduced consumption and income," and expressed a negative view on additional disaster relief fund payments, saying, "Now, solving the unemployment crisis is more important than the second disaster relief fund."

Meanwhile, the government has so far dismissed the idea of paying a second disaster relief fund.

Earlier, Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki emphasized during a Q&A session after the '2020 Second Half Economic Policy Direction' joint government briefing at the Government Seoul Office on the 1st, "As someone in charge of fiscal authorities, I am not considering additional emergency disaster relief fund payments at all," and stressed, "The government's position remains that it is not appropriate to introduce a basic income system under our circumstances."

Deputy Prime Minister Hong also reiterated his negative stance on additional disaster relief fund payments at the National Assembly's Planning and Finance Committee plenary session on the 17th, saying, "The first disaster relief fund was given to all citizens as a one-time, temporary concept," and added, "From the fiscal authorities' perspective, if there are similar resources, it is better to selectively and intensively support the more vulnerable groups. I am not actively in favor of the second support fund payment."

This content was produced with the assistance of AI translation services.