Korea, `Lottery Republic`

Ministries and local governments are excessively issuing lotteries. Because too many authorities have started lottery businesses in the name of fund raising, about 40 percent of the issued lotteries were not sold and destroyed.

Therefore, it does not work for the fund raising purpose and stirs up the peoples` gambling mind. Some criticize that the lotteries are functioning as so-called `semi-taxes,` which empty the common people`s pockets.

Ñ Overissue of lottery and social waste = Currently, 10 of the ministries and local governments are issuing lotteries. They are Ministry of Construction and Transportation, Ministry of Science and Technology, Ministry of Culture and Tourism, Ministry of Labor, Ministry of Commerce, Industry and Energy, Ministry of Government Administration and Home Affairs, Forest Service, Ministry of Patriots & Veterans Affairs, Ministry of Health and Welfare, and Jeju Provincial Government. They are issuing 21 kinds of lotteries, including drawing, instant, and cyber styles. The cost for making one lottery ticket is about 11 won for drawing style and 25 won for instant style. Thus, 1.46 billion won was wasted.

Ñ Low level of fund raising and stirring up the gambling spirit = The fund raising rates are lower than 20 percent, except the lotteries issued by Jootaek Bank (37 percent) and Ministry of Science and Technology (26 percent). The fund raising rate of the Forest Service`s `Green Lottery` is only 13 percent and that of the Ministry of Labor`s `Welfare Lottery` is 18 percent.

The fund raising rate is the percentage of the profit, sales minus the winning money and costs, to the total sales. Because of low sales performance and high costs, the rates are low. Thus, in order to increase the sales volumes, the issuing authorities have increased the winning prizes, and they are promoting people`s gambling spirit.

Since Jootaek Bank issued the `Millennium Lottery,` which has 2 billion won of the highest winning prize, in 1999, there has been prize increasing competitions, and the Ministry of Science and Technology issues the `Big Super Double Lottery,` which has 10 billion won of the highest winning prize.

Ñ Cause and problem of the lottery boom = Overheating of the lottery market is due to the loopholes of the system. If any government agency has a need, it can issue lotteries at a Minister`s discretion through an establishment or revision of laws.

A related figure said, “Although the market is limited, there are too many issuers. Therefore, they have to increased the issuing number of lotteries to secure the winning prizes, which are half of the sales. They have to compete against each other.”

Suh Cheon-Bum, Head of the Korea Leisure Industry Consulting, suggested that, ¡°The government has to control the highest winning prize through the establishment of the `Lottery Industry Development Committee` with civic experts.¡°

Dong-Yong Min mindy@donga.com · Hyo-Lim Son aryssong@donga.com