Seoul, – South Korea’s national debt surpassed the 600 trillion-won (US$536.7 billion) mark to hit a record high last year due to an expansionary fiscal policy to bolster the sluggish economy, the South Korea’s finance ministry said Tuesday.
The national debt that covers the central and provincial governments’ accounts and funds reached 627.1 trillion won in 2016, up 35.7 trillion won from a year earlier, according to the 2016 settlement of accounts endorsed by the Cabinet. The report will be submitted to the National Assembly by May after a review by the Board of Audit and Inspection.
It accounted for 38.3% of the country’s gross domestic product (GDP), down 0.5% from a year earlier.
The Ministry of Strategy and Finance said the 35.7 trillion won on-year gain included 31.8 trillion won worth of state debt raised by Treasury bonds.
The ministry added that national debt has been on a steady increase for a decade, with an on-year growth of around 40-50 trillion won. The pace slowed down slightly last year to 35.7 trillion won.
The South Korean government set aside an extra budget of 11 trillion won last year to prop up the faltering economy, which grew 2.7% due to weak exports and waning domestic demand.
Asia’s fourth-largest economy saw its exports post negative growth for nine months last year, with a 5.9 % decline for the whole of 2016.
Meanwhile, the gross revenue that the government brought in last year came to 401.8 trillion won, as its tax earnings expanded due to increased real estate transactions, while its expenditures totaled 384.9 trillion won.
As a result, its surplus reached 16.9 trillion won last year, a turnaround from a deficit of 200 billion won in 2015.
Based on the consolidated financial statements, South Korea’s state assets amounted to 1,962.1 trillion won and liabilities reached 1,433.1 trillion won, with net assets standing at 529 trillion won. (QNA)
Source: Qatar News Agency