Relaxed tourist visas, discount offers aimed at boosting domestic market

Tourists look around Gyeongbok Palace in central Seoul on Wednesday. [YONHAP]

The government is pushing to ease travel visa restrictions and provide discounts for tourists to attract more foreigners to Korea.

It plans to inject 40 billion won ($31 million) through subsidizing major discount events for hotels and attractions to promote tourism.

It will also allocate 20 billion won to finance travel expenses for small- and mid-sized company employees and store owners. Some 190,000 people are expected to benefit from these subsidies.

The moves are part of a plan announced Wednesday to boost the domestic market as the Korean economy continues to remain in the doldrums.

Under the plan, foreigners from 22 countries, including Japan, Singapore and the United States, will temporarily be allowed to enter Korea without applying for the Korea Electronic Travel Authorization (K-ETA). The K-ETA was a requirement for travelers coming from visa-free countries.

The countries were selected based on the number of travelers flying to Korea and the low rate of people denied entry.

The temporary lifting of the K-ETA will be implemented through next year.

The visa-free system applied to travelers with layovers in Korea will be resumed starting in April.

The visa-free system applied to transit travelers from 34 countries was halted during the Covid-19 outbreak.

Transit travelers will be allowed to stay in Korea for up to 30 days.

The government also plans to ease regulations for E-group visas for people from Vietnam, the Philippines and Indonesia.

Currently, E group visas are only issued to tourists that are on group tours that their employers have paid for or on school trips of five or more people.

The government plans to lower the number of required people in the tour group to three.

The government estimated that 1.34 million people would benefit from the discount programs, including 30,000 won discounts for every local hotel booking and 10,000 won discounts on online reservations for selected attractions.

Tourism-related transportation discounts include a maximum 50 percent cut on KTX railway tickets that are sold along with local tourism programs and a maximum 20,000 won discount on airplane tickets for domestic travel.

To attract visitors for longer periods, a "digital nomad visa" and "K-culture visa" will be offered.

The digital nomad visa will target those who want to stay in Korea for a year or even two without any economic activity in the country. The K-culture visa will target young foreigners with a strong interest in Korean culture who plan to enroll in related educational institutions. The K-culture visa will be granted for a maximum of 90 days and will be offered from June. No timeline was revealed for the digital nomad visa.

Major consumer discount events will be extended in hopes of opening up purse strings, including extending the days of the Korea Sales Festa held in November from 15 days to 20 days.

"Conditions to return consumption and tourism to pre-pandemic levels, especially for restaurants and hotels, are being created as the world is easing up on quarantine measures and the improvement in the relationship between Korea and Japan," President Yoon Suk Yeol said during a government meeting on Wednesday where the measures to boost the domestic market was announced. "We have to improve the visa system to be more convenient ahead of foreign tourists visiting Korea and quickly increase the number of flights."

He said now is the time for the government to consider measures that can boost economic value through the revitalization of the domestic market.

"We have to focus on vitalizing the economy by boosting the domestic market so that various culture and tourism products can smoothly lead to spending and sales," Yoon said.

Also announced Wednesday were plans to boost domestic consumption.

The government plans to offer discount events for major Korean agricultural, livestock and fishery products that are equivalent to 17 billion won.

Major retailers, including E-mart, Lotte Mart and Hanaro Mart, will offer up to 20 percent discounts. Traditional markets will be subsidized by the government so that the products can be sold with discounts of up to 30 percent.

There have been growing concerns about Korea's economic growth, especially with exports shrinking for five consecutive months, as well as inflation and high-interest rates.

According to the Finance Ministry, although private sector consumption grew 4.3 percent year-on-year last year, recently, it has been weakening amid rising consumer prices.

Consumer spending dipped 0.4 percent in the fourth quarter from a quarter earlier.

Consumer confidence continues to remain below 100, indicating that more people are pessimistic about the economic outlook than those who are not.

While the Korean government has been easing quarantine measures and opening up its borders, the number of people traveling to Korea has yet to reach pre-Covid 19 levels.

The government estimated the level is around 30 percent of what it was before the pandemic.

BY JIN MIN-JI [jin.minji@joongang.co.kr]