[2021 Budget] 17 Trillion Won to Be Invested in Next Year's Transportation and Logistics SOC

[Asia Economy Reporter Lee Chun-hee] The budget for safety in the land, infrastructure, and transportation sector has been expanded by 20% to 5.8 trillion KRW, significantly increasing the budget for strengthening the safety of aging transportation social overhead capital (SOC). The total budget for transportation and logistics is expected to reach 17 trillion KRW.

On the 1st, the Ministry of Land, Infrastructure and Transport announced that next year's budget proposal and fund operation plan amount to 56.7249 trillion KRW, an increase of 13.2% (6.5932 trillion KRW) compared to the previous year. The budget increased by 12.9% (2.6385 trillion KRW) to 23.1348 trillion KRW, and the fund increased by 13.3% (3.9547 trillion KRW) to 33.6 trillion KRW.

Among these, the SOC budget related to transportation and logistics totals 17.4495 trillion KRW, an increase of 1.3714 trillion KRW (8.53%) compared to last year's 16.0781 trillion KRW. The railway sector accounts for the largest share with 7.8055 trillion KRW, followed by roads with 7.3516 trillion KRW, logistics and others (including research and development (R&D)) with 1.9405 trillion KRW, and aviation and airports with 351.8 billion KRW. The fund includes 50.2 billion KRW allocated to the Automobile Accident Victim Support Fund.

In the railway sector, due to the high aging of infrastructure SOC such as electrical equipment, bridges, and tunnels, a large budget has been allocated for facility maintenance and improvement. 1.1512 trillion KRW will be invested in general railway safety and facility improvement to stabilize signaling systems, upgrade track switches, electrical equipment, and tracks. 146.2 billion KRW is planned for safety and facility improvements in high-speed rail. For urban rail (subway), 36.9 billion KRW is allocated to improve electrical equipment that has exceeded its service life to prevent service interruptions and accidents.

In the road sector, the budget for maintenance of large-scale facilities of types 1 and 2 is increased, and budgets for various safety measures such as winter road traffic safety enhancement plans are allocated. Additionally, various SOC projects such as installing crosswalk lighting, road pavement maintenance, and roadside sidewalk installation are continuously promoted to prevent traffic accidents. Specific projects include ▲road safety and environmental improvement (860.1 billion KRW) ▲road maintenance (664.4 billion KRW) ▲road bottleneck improvement (166.6 billion KRW) ▲hazardous road improvement (148.2 billion KRW).

To revitalize stagnant regions, projects to expand major arterial transportation networks have also been significantly expanded. Over 3 trillion KRW has been allocated to ensure smooth progress of ongoing arterial transportation network projects. In the road sector, budgets have been allocated for ▲Seoul~Sejong Expressway (669.9 billion KRW) ▲Saemangeum~Jeonju Expressway (187.9 billion KRW) ▲Daegu Ring Expressway (105.3 billion KRW). In the railway sector, budgets have been allocated for ▲West Sea Line double-track electrification construction (580 billion KRW) ▲Dodam~Yeongcheon double-track electrification construction (505 billion KRW) ▲Pohang~Samcheok railway construction (258.5 billion KRW) ▲Honam High-Speed Railway Phase 2 (Gwangju~Mokpo) (200 billion KRW) to advance construction projects. In the airport sector, budgets have been allocated for ▲Ulleungdo small airport (80 billion KRW) ▲Jeju 2nd airport (47.3 billion KRW) ▲Heuksando small airport (6.9 billion KRW).

To fully promote the preliminary feasibility study exemption projects announced in January last year, 375.6 billion KRW has been allocated in next year's budget proposal. Newly launched national road hazardous section improvement projects and the 'Southwest Coast Tourist Road' to revitalize the southern coast will begin full-scale construction, and design-stage projects such as Sejong~Cheongju Expressway and 2nd Gyeongchun National Road have also been budgeted. Budgets for Daejeon Urban Railway Line 2 (tram) of 9 billion KRW and Saemangeum New Airport of 12 billion KRW are also included.

A budget of 265.6 billion KRW has been allocated for the metropolitan area express railway (GTX), which will be a core part of the metropolitan area wide-area transportation network. The GTX-A line, targeted to open by the end of 2023, and the Samsung~Dongtan metropolitan express railway will each receive 123.3 billion KRW and 98.8 billion KRW respectively for construction. GTX-B has been allocated 1 billion KRW for the private investment facility project basic plan (REP), and GTX-C is planned to start construction by the end of next year with a budget of 42.5 billion KRW. Including the GTX-related budget, next year's wide-area and urban railway project budget has increased by about 280 billion KRW from this year's 917.1 billion KRW to 1.196 trillion KRW, surpassing 1 trillion KRW.

Regarding buses, budgets will be invested in ▲local government low-floor bus introduction subsidies (56.9 billion KRW) ▲transfer center projects (17.7 billion KRW) ▲wide-area BRT construction (14.1 billion KRW) ▲wide-area bus quasi-public operation projects (2.3 billion KRW).

To alleviate parking difficulties in urban and residential areas, a support budget of 256.7 billion KRW has been included to build 288 public parking lots nationwide.

The digital twin project across the entire land to support new growth engines such as autonomous vehicles and drones will also be expanded. Digital twin technology creates a complete virtual twin of real-world objects, which is essential for the growth of autonomous vehicle and drone industries. The Ministry of Land, Infrastructure and Transport plans to increase the digital twin-related budget, including 3D map construction and precision road maps, from 89.2 billion KRW this year to 158.4 billion KRW next year.

Budgets will also be allocated to support automobile accident victims. The Automobile Accident Victim Support Fund includes 50.2 billion KRW for compensation for uninsured and hit-and-run accident victims (17.6 billion KRW) and support for vulnerable groups affected by accidents (21.7 billion KRW).