[2023 National Audit] Choi Hyung-doo "Alley-type Shopping Districts Concentrated in Seoul Metropolitan Area... Need Improvement"

Choi Hyung-doo, member of the People Power Party.

Along with traditional markets, concerns have been raised that the designation of 'alley-type shopping districts' where Onnuri gift certificates can be used is excessively concentrated in the Seoul metropolitan area, necessitating improvements.

Choi Hyung-doo, a member of the People Power Party, stated this ahead of the comprehensive audit of the Ministry of SMEs and Startups by the National Assembly's Industry, Trade, Resources, SMEs, and Startups Committee scheduled for the 27th.

The alley-type shopping district is a concept introduced in August 2020, referring to an area within 2,000㎡ where 30 or more stores operated by small business owners are densely clustered. In alley-type shopping districts, Onnuri gift certificates can be used, providing positive effects for both local residents and small business owners.

The problem is that the regulations for alley-type shopping districts are centered on the Seoul metropolitan area. In large cities with many people and densely clustered stores, it is easier to meet the condition of '30 small business stores within 2,000㎡,' but in non-metropolitan areas with fewer people and lower density, it is difficult to meet the criteria.

As of last month, among the 151 designated alley-type shopping districts, 89 (about 59%) are concentrated in the Seoul metropolitan area. Other metropolitan local governments have smaller shares: Daejeon 17 (11.26%), Busan 6 (3.97%), Daegu 2 (1.32%), Gwangju 6 (3.97%). In Gyeongnam, only one area, the ‘Geochang Gajo Shopping District Merchants Association,’ has been designated.

Although local governments have prepared consultation plans to allow some flexibility in uniform policies through ordinances, the regulatory barriers remain high. In the Seoul metropolitan area, due to high store density, it is possible to meet the alley-type shopping district criteria through existing standards or ordinance revisions. However, in provincial areas, it is mostly difficult to meet the criteria even if ordinances are changed.

According to the ‘2023 Analysis of Alley-type Shopping District Density and Review of Criteria Reform’ published by the Small and Medium Business Research Institute, alley commercial districts have lower rents compared to main street commercial districts, attracting many small-scale small business owners. Consequently, the commercial district range is small and sensitive and vulnerable to changes in rent, minimum wage, and the economy. Examining store density by urban scale and land use zones shows that ‘the average store density in alley-type shopping districts in large cities is 25.8,’ ‘the average store density in general city commercial zones in small and medium cities is 18.2,’ and ‘the average density in county commercial zones in rural areas is 18.9.’ For small and medium cities and rural areas, including non-commercial zones, the average densities are ‘9.8’ and ‘13.8,’ respectively.

These figures indicate that even the minimum consultation proposal by the Ministry of SMEs and Startups, ‘20 or more small business stores within 2,000㎡,’ is difficult to meet. As the economy worsens and concentration in the Seoul metropolitan area increases, the average density in small and medium cities and rural towns decreases further. When the Small and Medium Business Research Institute applied the alley commercial district density definitions of Seoul and Suwon to Cheongju, it confirmed that the alley commercial district regulations were unsuitable and analyzed the need to newly propose the scope and criteria of alley commercial districts.

Choi Hyung-doo said, “Currently, the alley-type shopping district regulations do not consider city size and lack consideration of the characteristics of alley-type shopping districts,” and pointed out, “Through regulatory reform, the designation of alley-type shopping districts should be increased and the use of Onnuri gift certificates expanded so that both small business owners and residents can benefit.”

This content was produced with the assistance of AI translation services.