Debts of Public Institutions Projected to Exceed 600 Tril. Won in 2023

The Ministry of Economy and Finance announced on Aug. 31 that major public institutions’ debts are estimated to reach 549.6 trillion won this year, 606.9 trillion won in 2023, and 638.9 trillion won in 2025.

Such a rapid increase in the debts of the 40 institutions is because public enterprises are in charge of national projects such as rental house supply. With the enterprises resorting to corporate bond issuance for financing, their interest burden is surging as well.

“Although the liabilities are increasing, their debt ratio is being maintained at a stable level as their capital is increasing at the same time,” the ministry explained, adding, “The ratio is estimated to rise from 167.5 percent to 172.5 percent next year and reach 162.6 percent in 2025.”
 

Still, experts are pointing out that the long-term increase in capital mentioned by the ministry is because of government investment and asset revaluation rather than the profitability of public enterprises.