As the compound crisis stemming from the Middle East enters a prolonged phase, the Busan Metropolitan Government is launching a two-track response combining massive fiscal injection with structural transformation. The strategy aims to absorb the shock of high oil and consumer prices in the short term while restructuring the energy and industrial base over the medium to long term. The shift is notable because the policy focus is moving beyond simple economic stimulus toward "crisis-responsive economic restructuring."
According to the city government on the 18th, Busan is activating an emergency economic package worth 1.262 trillion won ($920 million). In particular, the city has urgently drafted a second supplementary budget of 550.8 billion won, of which 485.3 billion won will be concentrated on stabilizing livelihoods and supporting businesses. This follows the 350 billion won first supplementary budget already executed after the Middle East crisis broke out, reflecting the severity of the situation on the ground.
The measures are organized around three pillars — livelihood stability, corporate vitality and energy transition — comprising 10 tasks and 34 detailed projects. The package combines "defense" against external shocks with "offense" aimed at future industrial transformation.
On the livelihood front, policy resources are concentrated on cushioning the impact of high oil prices. Direct support for production and logistics sites, including safe driving assistance for cargo trucks and community buses and compensation for increases in tax-exempt fuel for the fishing and farming sectors, forms the core. The city is also expanding commuter buses for industrial complex workers, freezing public utility rates, stabilizing the supply of daily necessities and strengthening incentives for "Good Price Shops" to curb inflation felt by residents. The total scale is 477.4 billion won.
For the corporate sector, the city has built a three-stage response structure running from liquidity supply to export support and supply chain stabilization. It will prevent credit crunches by providing an additional 500 billion won in policy funds for small and medium-sized enterprises and small business owners, extending maturities and establishing new financing for joint raw material purchases. Export vouchers and logistics cost support will buffer external risks. At the same time, the city will introduce joint platforms and raw material stockpiling systems for key industries such as shipbuilding equipment, auto parts and textiles to reduce supply chain shocks.
A particularly notable element is the speed of on-site response. Dedicated windows will be set up at the Busan Chamber of Commerce and Industry's One-Stop Business Support Center and the Busan Economic Promotion Agency's Export One-Stop Center to immediately handle corporate difficulties, and a "fast track" will be built to proactively identify companies in crisis and link them with financial and logistics support. On the tax side, flexible measures such as extensions of payment deadlines and collection deferrals will also be pursued.
Another pillar of the measures is the energy transition. The plan is to turn the high oil price crisis into an opportunity to accelerate the shift to renewable energy. The city will build energy independence infrastructure, including solar power, centered on the Sinpyeong and Jangnim industrial complexes, and establish a clean energy convergence hub in the Gijang area. The Gadeok Green Energy City and resident-participation "Sunlight Income Village" projects will also be pursued to expand a region-based distributed energy ecosystem.
The effort goes beyond crisis response to reshape the foundation of industrial competitiveness. It is interpreted as a strategic move to break away from an existing industrial structure vulnerable to global energy price volatility and to take the lead in responding to RE100 and carbon neutrality trends.
Immediately after the Middle East crisis erupted, the city activated an emergency response team involving 22 institutions and maintained a daily monitoring system. However, amid recent uncertainty marked by repeated cycles of ceasefire and conflict, the prolonged "triple shock" of high exchange rates, high oil prices and high consumer prices has made a more comprehensive prescription unavoidable.
"These measures combine short-term prescriptions to minimize the shock to livelihoods with medium- and long-term strategies to improve the economic constitution," Busan Mayor Park Heong-jun said. "We will mobilize all fiscal and policy tools to build a defense line for the regional economy."
