Councilor Kim Gidae: "Let's Prepare the 2nd COVID-19 Supplementary Budget with Supplementary Appropriations and Local Bond Issuance"

Seoul City Councilor Kim Gidae Highlights Severe Ground-Level Economy, Calls for Second Emergency Aid, Budget Tightening, and Active Local Bond Issuance in Zero-Interest Era

[Asia Economy Reporter Jong-il Park] Recently, the Seoul Metropolitan Government has allocated a "COVID-19 supplementary budget (734.8 billion KRW)" to provide relief for damages caused by the spread of COVID-19. However, despite this effort, it is considered grossly insufficient, and there is a proposal within the Seoul Metropolitan Council to prepare an additional second supplementary budget using budget cuts and revisions of the 2020 Seoul city budget projects, i.e., budget reductions and active issuance of local bonds as funding sources.

Kim Gi-dae, Chair of the Urban Safety and Construction Committee of the Seoul Metropolitan Council (Democratic Party, Seongdong 3), stated that although the central government and Seoul city are making significant efforts such as actively utilizing the disaster management fund and preparing emergency supplementary budgets to respond to COVID-19, the economic sentiment among citizens is extremely severe, and the grassroots economy still shows no signs of recovery. He strongly urged the necessity of a swift second supplementary budget.

As a measure to secure funding for the second supplementary budget, Chair Kim proposed implementing substantial budget cuts and revisions (budget reductions) focusing on projects within this year’s Seoul city budget that are progressing sluggishly or lack urgency, and actively promoting the issuance of local bonds, especially as we have entered a zero-interest-rate era.

Chair Kim’s proposal also reflects the consideration that the disaster management fund, which Seoul city has actively used since before the recent COVID-19 supplementary budget as an initial response, must be reserved for future disasters such as typhoons and floods. Therefore, it is necessary to significantly reduce reliance on the disaster management fund and instead secure additional COVID-19 response funds through budget reductions of existing projects and issuance of local bonds.