Government Makes 180.4 Billion KRW Capital Contribution in Kind to Korail... Debt Ratio Decreases by 6%p

[Sejong=Asia Economy Reporter Kim Hyunjung] The government will contribute in-kind assets worth 180.4 billion KRW, including land located in Uiwang, Gyeonggi-do and Dangam-dong, Busan, to Korea Railroad Corporation (KORAIL). As a result, the railroad corporation's debt ratio is expected to decrease by 6 percentage points from 247.8% to 241.8%.

The Ministry of Economy and Finance announced that at the 15th Cabinet meeting held on the same day, it approved the "In-kind Contribution of State-owned Assets to Korea Railroad Corporation (Draft)." This government contribution aims to improve the efficiency of railroad operations and enhance railroad services by contributing railroad operating assets held by the Ministry of Land, Infrastructure and Transport to the railroad corporation in-kind.

The contribution targets railroad operating assets under the special account for transportation facilities managed by the Ministry of Land, Infrastructure and Transport, including land, buildings, and machinery and equipment, with a contribution value of approximately 180.4 billion KRW. The land includes a total of 166 parcels (170,650㎡, 162.3 billion KRW) located at Obong Station (Uiwang-si, Gyeonggi-do) and Busan Vehicle Maintenance Unit (Dangam-dong, Busan). The buildings consist of 16 structures (21,093㎡, 16.8 billion KRW), including inspectors' dormitories at Daejeon Station and staff dormitories at Cheongju Station. The machinery and equipment include 203 vehicle maintenance devices (1.3 billion KRW) stored at Byeongjeom and Imun Vehicle Depots. Through this capital increase via contribution, the railroad corporation's debt ratio is expected to decrease by 6 percentage points from 247.8% as of the end of last year to 241.8%.

This contribution supplements assets that were excluded due to reasons such as being under construction or unsettled cadastral records when the Korea National Railroad was launched as the Korea Railroad Corporation on January 1, 2005, and when railroad operating assets worth 13.9 trillion KRW were contributed in-kind in three phases from 2005 to 2008. The Ministry of Economy and Finance explained that since the value and utilization of the already contributed land have increased and the reconstruction and expansion of aging buildings have become possible, the efficiency of railroad operations is expected to improve.

Furthermore, the railroad corporation plans to improve railroad services through facility investments of about 25 billion KRW, including expanding maintenance facilities to ensure the quality of railroad vehicle maintenance, taking this contribution as an opportunity.

This content was produced with the assistance of AI translation services.