National Debt That Government Guaranteed Paying Exceeded 100 Trillion Won.

The Ministry of Finance and Economy (MOFE) announced on the 9th that government-guaranteed debt was 106 trillion 769.6 billion won at the end of last year, which was 19.6 percent of Gross Domestic Product (GDP) 545 trillion (tentative) won in 2001.

Government-guaranteed debt surged 43.2 percent from 74 trillion 565.4 billion won (14.3 percent of GDP in 2000) at the end of 2000. The rise was resulted from that government injected public funds of 97 trillion and 355.3 billion won in 2001, which is 42.8 percent more than 68 trillion and 166.7 billion won in 2000, into restructuring bonds like deposit insurance fund bonds and insolvent bonds clearing fund bonds

National debt is an unfixed debt, which government should pay instead of public institutions like Korea Deposit Insurance Corporation (KDIC), when it becomes insolvent.

National debt at the end of last year was 122 trillion and 100 billion won or 22.4 percent of GDP last year. The ratio of Korean national debt to GDP was lower than that of America (59.4 percent), Japan (123.2 percent), Germany (60.8 percent), France (64.1 percent) and England (53.8 percent) as well as the OECD average 72.7 percent.

Choi Qyu-Yeon Chief of Treasury Division in MOFE said, “Even sum total of National debt and government-guaranteed debt is 42 percent of GDP, which is still stable compared with other OECD countries. ”

Joong-Hyun Park sanjuck@donga.com