‘Squirrel road’ versus‘ pepper airport’
Published: 30 Aug. 2023, 20:00
Updated: 31 Aug. 2023, 12:05
KIM KI-HWAN
The author is a business news reporter of the JoongAng Ilbo.
There is a “squirrel road” in Japan. Does it refer to a dedicated road that allows squirrels to run around in an eco-friendly environment? Nope.
In the 1990s, the Japanese government promoted the construction of infrastructure such as roads, airports and railroads across the country. It did not carefully examine the feasibility of the project in order to boost the slow economy. Budgets were wasted to build roads going deep into forests with no traffic. Now some roads are only used by squirrels, not cars.
In Korea, there is a “pepper airport” similar to squirrel road. Does it refer to an airport built on a pepper field that happened to be at a key transportation hub? Again, that’s not the case. It’s called that because the airport is so rarely used that the runway could be used by farmers to dry peppers.
There are 15 airports in the country, but 11 have chronic deficits aside from those in Incheon, Gimpo, Gimhae and Jeju. Nevertheless, there are constant calls to build more airports.
According to the “2024 Budget Proposal” announced by the government on Aug. 29, the infrastructure budget for next year is fixed at 26.1 trillion won ($19.7 billion), up 4.6 percent from this year’s budget of 24.9 trillion won.
Even key budgets such as jobs and R&D were cut one after another, but the infrastructure budget was an exception. There is criticism that the National Assembly, whose members have constituency issues, and the government, sensitive to approval ratings, have joined forces to raise the budget ahead of next April’s parliamentary elections without proper vetting.
Anyone engaged in economic activities would conduct a cost-benefit analysis. If the physical and time costs from a choice and the direct and indirect benefits are converted to monetary values, you would go for it because the benefit is greater than the cost. This would be called a reasonable choice.
The system adopted in 1999 to address this was the preliminary feasibility study. In the study, a project is considered economically reasonable only when the benefit-to-cost ratio is more than 1.0.
According to the results of the preliminary feasibility study by the Korea Development Institute (KDI), the benefit-to-cost ratio of the Gadeok Island airport in Busan was 0.58. In other words, the benefit of investing 100 won is only 58 won. The results of a preliminary feasibility study of a new airport at Saemangum, North Jeolla — which was under fire for the disruption of the World Scout Jamboree — was only 0.48. It is a failing score, but it was exempt from the preliminary study during the Moon Jae-in administration. The Seosan airport in South Chungcheong survived even after failing to pass the preliminary study. The airport will soon turn into another “pepper airport.”
The author is a business news reporter of the JoongAng Ilbo.
There is a “squirrel road” in Japan. Does it refer to a dedicated road that allows squirrels to run around in an eco-friendly environment? Nope.
In the 1990s, the Japanese government promoted the construction of infrastructure such as roads, airports and railroads across the country. It did not carefully examine the feasibility of the project in order to boost the slow economy. Budgets were wasted to build roads going deep into forests with no traffic. Now some roads are only used by squirrels, not cars.
In Korea, there is a “pepper airport” similar to squirrel road. Does it refer to an airport built on a pepper field that happened to be at a key transportation hub? Again, that’s not the case. It’s called that because the airport is so rarely used that the runway could be used by farmers to dry peppers.
There are 15 airports in the country, but 11 have chronic deficits aside from those in Incheon, Gimpo, Gimhae and Jeju. Nevertheless, there are constant calls to build more airports.
According to the “2024 Budget Proposal” announced by the government on Aug. 29, the infrastructure budget for next year is fixed at 26.1 trillion won ($19.7 billion), up 4.6 percent from this year’s budget of 24.9 trillion won.
Even key budgets such as jobs and R&D were cut one after another, but the infrastructure budget was an exception. There is criticism that the National Assembly, whose members have constituency issues, and the government, sensitive to approval ratings, have joined forces to raise the budget ahead of next April’s parliamentary elections without proper vetting.
Anyone engaged in economic activities would conduct a cost-benefit analysis. If the physical and time costs from a choice and the direct and indirect benefits are converted to monetary values, you would go for it because the benefit is greater than the cost. This would be called a reasonable choice.
The system adopted in 1999 to address this was the preliminary feasibility study. In the study, a project is considered economically reasonable only when the benefit-to-cost ratio is more than 1.0.
According to the results of the preliminary feasibility study by the Korea Development Institute (KDI), the benefit-to-cost ratio of the Gadeok Island airport in Busan was 0.58. In other words, the benefit of investing 100 won is only 58 won. The results of a preliminary feasibility study of a new airport at Saemangum, North Jeolla — which was under fire for the disruption of the World Scout Jamboree — was only 0.48. It is a failing score, but it was exempt from the preliminary study during the Moon Jae-in administration. The Seosan airport in South Chungcheong survived even after failing to pass the preliminary study. The airport will soon turn into another “pepper airport.”
with the Korea JoongAng Daily
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