Disputes over the growing national debt

On May 4, there was a heated discussion between ruling party and the main opposition Grand National Party (GNP) over the growing national debt. GNP argued, `the government is deferring the recovery of government bonds and payment of the public funds until after 2003, imposing an enormous burden of paying the national dept on the next government`.

Kwon Chul-hyun, a GNP spokesperson, said in a statement that `the nation`s debt totaled 1000 trillion (W) including the government`s payment guarantee, estimated deficit figure of the National Pension Fund and debts owed by state-run firms and banks`. He requested that the government and the ruling party should disclose everything in detail by publishing `Encyclopedia on state`s debt` and propose a blueprint for debt decrease.

Kwok said, `Because the government spends money like there is no tomorrow, the future of the nation`s fiscal situation is at stake. The government should not transfer the financial burden to the next government`.

GNP submitted a document titled `Transferring the Burden to the Next Government` and pointed out that the national bond, along with the redemption of public funds principal and interest, would totaled 94.4 trillion (W) between 2003 and 2005. GNP also pointed out that `Especially, because the government has used expedient means, such as 5-year deferment of the public funds with 7-year partial repayment, the repayment of the principal will begin in 2003.

Responding to the GNP claim, Jun Yong-hak, the New Millennium Democratic Party (MDP) spokesperson, commented, "GNP has only sought to find a sore spot in the government`s efforts to make a reform and structural adjustment. It is irresponsible attitude to say things like `the imposed burden on the next government. It is questionable whether GNP is qualified to lead the nation`. Jun added, `GNP overstated the total national dept as 1000 trillion (W), although the national dept stands at about 120 trillion (W). This kind of inaccurate statement as well as untimely provocation will only damage the national trust and affect badly on our current economic situation`.

MDP submitted a counter-document titled `Four Reforms, Task of Our Time` and argued that de facto GNP was responsible for waning economy through the close relationships between politics and economics`. MDP further mentioned, "The increasing national debt for the last three years was unavoidable in the process of disclosing how the economy became waned to the general public`.

Moon Chul fullmoon@donga.com