Incheon to provide 100 million won in subsidies for children born in city

Incheon Mayor Yoo Jeong-bok announces policies aimed at population growth at the city hall in Incheon on Monday. [INCHEON METROPOLITAN CITY]

Incheon city government announced it will subsidize parents up to 100 million won ($77,000) for children born in Incheon until they turn 18.

The subsidy program includes 150,000 won monthly allowances for children for 10 years.

The monthly allowance is the first of its kind in the country.

Incheon Mayor Yoo Jeong-bok on Monday unveiled the “1 million + i dream” incentive policy to create a family-friendly environment and promote population growth.

Building upon the existing 72 million won subsidy that covers education expenses until a child graduates from high school, the city government introduces an additional 28 million won in subsidies, including transportation payments for pregnant women.

In addition to the existing 2 million won provided to families welcoming a newborn starting next year, the city government will introduce an annual subsidy of 1.2 million won for children aged one to seven.

For children between the ages of eight and 18, a monthly cash allowance of 150,000 won will be granted.

The joint financial support from the central and local governments, including Incheon City, currently amounts to 100,000 won per month.

However, this allowance is cut off when the child turns eight.

The upcoming allowance will be given for children born in 2024 when they turn eight in 2032.

However, the government said it is also giving smaller allowances to children turning eight next year.

Children born between 2016 and 2019 will receive a monthly allowance of 50,000 won until 2024.

Children born between 2020 and 2023 will receive a monthly allowance of 100,000 won until 2028.

Expectant mothers will be granted 500,000 won to cover transportation expenses.

The city government said it has already secured next year’s budget to implement policies encouraging families to have children.

It added that it only needs to undertake the necessary administrative procedure.

The country is grappling with a declining population characterized by the world’s lowest fertility rate and a rapidly aging population.

According to Statistics Korea, the current population of 52 million is projected to decrease to 36 million over the next 50 years.

A staggering 47.7 percent is anticipated to be 65 years or older.

Even this projection is based on the optimistic assumption that the country’s fertility rate will improve.

The population decline is expected to have a substantial impact on both the nation’s economic growth and its national security.

According to a study by the Korea Economic Research Institute, if the productive population shrinks by 1 percent, the nation’s GDP contracts 0.59 percent. If the fertility rate persists, the country’s GDP in 2050 will be 28 percent smaller than in 2022.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]