Outstanding debt issued by the government and public enterprises of South Korea passed the milestone of 1,000 trillion won ($861.5 billion) last year amid record-sized fiscal spending to prop up economy and historic-low interest rates.
According to Koscom Corp., system manager of bourse operator Korea Exchange, the outstanding amount of bonds issued by the Korean government and public institutions surged by 51.6 trillion won, the largest in four years, to total 1,020.4 trillion won last year. It is the first time for the outstanding amount of treasury and quasi-government bonds to exceed 1,000 trillion won.
By type, the government net issued state bonds worth 47.7 trillion won last year, nearly doubled from a year earlier. Public institutions issued bonds - backed by the government - in net 3.8 trillion won. In 2018, balance in quasi-public debt was negative as the repaid amount overwhelmed new issues.
The net amount of government and quasi-government debts, or total bond issues minus those paid off, had fallen continuously from 78.5 trillion won in 2015 to 15.6 trillion won in 2018 but jumped back last year as the government bumped up bond issues to finance fiscal spending against reduced tax revenue.
The balance will stretch further this year as the government plans to issue 70.9 trillion won in new issues this year to back even bigger budgetary spending.
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]