The South Korean government said Thursday that it will build a new highway linking Seoul and the country's administrative capital by 2025 in a bid to reduce traffic congestion on existing roads.

At a meeting of economy and finance-related ministries, the government decided to inject 6.7 trillion won ($5.74 billion) to build the 129-kilometer highway between the capital city and Sejong City, home to 36 government agencies.

The government will finance 1.4 trillion won and raise 5.3 trillion won from private companies.

The first 71km leg of the road will be completed by 2022 with the remaining part to be opened in 2025.

The new highway is expected to cut travel time between Seoul and Sejong to 74 minutes from the current 108 minutes during the week.

The project was first initiated in 2009 in order to resolve traffic congestion on Gyeongbu Expressway, the country's mainstay highway, and Jungbu Expressway, but has been ditched for years due to the high costs amid protracted slump in the local construction industry.

"The new Seoul-Sejong highway is aimed at relieving traffic congestion on the current roads," said the Ministry of Land, Infrastructure and Transportation. "When it is completed, traffic jam on Gyeongbu Expressway and Jungbu Expressway will decrease 60 percent." (Yonhap)