KCCI's Policy Recommendation No.1 to Presidential Candidates: "Regulatory Reform and Local Currency"

Job Creators Not Subject to Large Corporation Regulations
Rational Regulation Needed... Regulatory Innovation Required
Expand Local Currency Budget to Revitalize Domestic Demand

[Asia Economy Reporter Hwang Yoon-joo] The Korea Chamber of Commerce and Industry (KCCI) summarized its top economic policy recommendations to presidential candidates as 'regulatory improvement' and 'domestic demand.' For regulatory improvements, it highlighted redesigning the dispersed interest rate system and the Fair Trade Act. It also notably requested an expansion in the issuance scale of consumption coupons and local currencies to revitalize the domestic economy. In particular, local currency is well known as a policy of Lee Jae-myung, the presidential candidate of the Democratic Party of Korea.

According to the '20th Presidential Election Recommendations' delivered by KCCI to Lee Jae-myung, the Democratic Party candidate, last October, the top recommendations included ▲rational improvement of regulations on large corporations ▲consumption coupons ▲local currency.

According to the recommendation book, KCCI asked presidential candidates to recognize the positive role of large corporations. Large corporations invest in new businesses, create jobs, and contribute to national development. Recently, the government and economic organizations have clashed with the government over labor regulations such as the minimum wage, 52-hour workweek, and the Serious Accident Punishment Act. The emphasis on recognizing the positive role of large corporations first can be interpreted as a plea not to view companies solely as targets for sanctions.

KCCI stated, "Regulations on large corporations should be rationally improved," adding, "If investments by large corporations benefit the national interest, it is necessary to devise operational strategies that include safeguards against side effects and redesign regulations such as the separation of banking and commerce and restrictions on economic power concentration."

It further proposed, "Difficulties in overseas expansion and global business of large corporations should be resolved," and "Offshore application systems such as the Fair Trade Act should be operated flexibly."

"Overcame COVID-19 crisis with local currency, but domestic demand momentum must be strengthened"

It is noteworthy that KCCI placed local currency and consumption coupons at the forefront of its recommendations. Specifically, it requested that the government maintain or expand the 2022 budget for local currency support at this year's level and increase the number of industries and affiliated stores where local currency can be used to promote its spread.

This year, the budget for local currency was at an all-time high to revitalize the local economy after COVID-19. However, the 2022 local currency budget shrank to 77% of this year's level.

Ultimately, the National Assembly passed a budget bill for next year totaling 607.7 trillion won. Compared to the original government proposal of 604.4365 trillion won, 5.552 trillion won was cut and 8.7788 trillion won was added, resulting in a net increase of 3.2268 trillion won. Although the government submitted a budget of 604.4365 trillion won (total expenditure basis) for next year, during discussions between ruling and opposition parties, support budgets including COVID-19 small business loss compensation were increased to about 68 trillion won, and the issuance scale of the 'Lee Jae-myung budget' local love gift certificates (local currency) was also increased to 30 trillion won.

KCCI proposed expanding the industries and affiliated stores where local currency can be used. In the recommendation book, KCCI pointed out, "In Gyeonggi Province, only affiliated stores with annual sales under 1 billion won can register as affiliated stores," and "The biggest inconvenience in using local currency was difficulty in obtaining affiliated store information, followed by a shortage of affiliated stores." In particular, it noted that paper-type and card-type local currencies can only be used for on-site payments, requiring users to carry physical cards, which is also an area for improvement.

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