167.8 Trillion Won in Government Bonds to Be Issued Next Year... Net Issuance of 61.5 Trillion Won

MoEF, Announces '2023 National Treasury Bond Issuance Plan'

[Asia Economy Sejong=Reporter Lee Junhyung] The government will issue government bonds worth 168 trillion won next year. The net issuance limit of government bonds that increases the national debt balance will be reduced to 61.5 trillion won, about 60% of this year's level.

On the 26th, the Ministry of Economy and Finance finalized and announced the "2023 Government Bond Issuance Plan" containing these details. In this plan, the Ministry set the total issuance limit of government bonds for next year at 167.8 trillion won. This is 8 billion won less than this year's government bond issuance volume of 168.6 trillion won.

The net issuance limit of government bonds that increases the national debt balance was significantly reduced. The net issuance limit for government bonds next year is 61.5 trillion won, which is 59% of this year's 104.8 trillion won. However, the refinancing issuance limit is 106.3 trillion won, which is 33.7 trillion won more than this year's 72.6 trillion won. A Ministry of Economy and Finance official explained, "The maturity of government bonds increased during the COVID-19 crisis response has begun, so the total issuance limit including refinancing issuance next year slightly decreased compared to this year."

The policy of issuing more government bonds in the first half of the year than in the second half, known as "Sanggohajeo," will be maintained next year as well. However, considering recent market supply and demand conditions, the issuance volume of government bonds in the first quarter of next year is expected to be between 42 trillion and 48 trillion won. Compared to this year's first quarter issuance volume of 53.3 trillion won, this is a reduction of nearly 10 trillion won at most.

By maturity, the issuance proportion of short-term bonds (2- and 3-year bonds) will increase by 5 percentage points from 25% to 30%. On the other hand, the issuance proportion of medium-term bonds (5- and 10-year bonds) will decrease by 5 percentage points from 40% to 35%. The issuance proportion of long-term bonds (20-, 30-, and 50-year bonds) will remain the same as this year at 35%. The Ministry explained that the issuance proportions by maturity were decided considering next year's macroeconomic and financial conditions as well as the capacity of insurance companies to demand long-term bonds.

The Ministry of Economy and Finance stated that it intends to issue government bonds stably, considering the allocation direction in the issuance plan and market conditions. The Ministry said, "We will closely monitor market conditions and, if necessary, promptly implement market stabilization measures such as cooperation with related agencies and emergency buybacks."

Vice Minister Choi Sang-dae Presiding Over the Treasury Bond Issuance Strategy Council
(Seoul=Yonhap News) Vice Minister Choi Sang-dae of the Ministry of Economy and Finance is presiding over the "4th Treasury Bond Issuance Strategy Council" held at the Bankers' Hall in Jung-gu, Seoul on the 22nd. 2022.12.22 [Provided by the Ministry of Economy and Finance. Resale and DB prohibited]
Photo by Choi Sang-dae
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