Debt 0 Won 'Soon'... Gimhae City Early Repayment of 45.6 Billion Won in Local Bonds

Gimhae City in Gyeongnam Province will repay 45.6 billion KRW of local bonds early to strengthen local fiscal soundness in the era of high interest rates.

The city had previously issued a total of 46.6 billion KRW in local bonds from financial institutions between 2019 and 2022 for social overhead capital (SOC) projects aimed at improving residents' living convenience and for the development of regional new growth industries.

The principal amount of 45.6 billion KRW, which was scheduled to be repaid in installments until 2032, will be fully repaid next week.

The city plans to deposit 45 billion KRW of surplus funds from water and sewage and other special accounts into the Integrated Fiscal Stabilization Fund to repay the relatively high-interest financial local bonds nine years ahead of schedule.

Gimhae City Hall, Gyeongnam.
Photo by Lee Seryeong

According to the city, this early repayment will reduce interest expenses by a total of 10.3 billion KRW, and with the full early repayment of the financial local bonds, the city’s future burden of high-interest financial debt will become zero.

The city plans to prioritize the saved interest costs for preparations to successfully host the National Sports Festival next year and for projects to revitalize the local economy.

Following the early repayment of 10.6 billion KRW in local bonds for the National Road No. 58 alternative bypass project and the full early repayment of these financial bonds, the city intends to maintain fiscal soundness through reducing local bond issuance and cutting unnecessary budgets.

Mayor Hong Tae-yong said, “Since the launch of the 8th elected administration, in response to the government’s fiscal tightening due to the economic downturn, we have been able to fully repay the high-interest financial bonds early through strong expenditure restructuring and proactive debt management,” adding, “We will continue sustainable fiscal management to become the happiest city that improves the quality of life for our citizens.”

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