Local Public Enterprises' Debt Ratio at 39.3%... Maintains 30% Range for Seven Consecutive Years

Up 1.5 Percentage Points from the Previous Year
Debt Ratio of Local Public Enterprises Continues to Rise

In 2024, the debt ratio of local public enterprises remained at 39.3%, maintaining the 30% level for the seventh consecutive year.

The Ministry of the Interior and Safety announced the 2024 settlement results for 418 local public enterprises on August 12. The total assets of local public enterprises amounted to 247.1 trillion won, with liabilities at 69.8 trillion won, equity at 177.3 trillion won, and a net loss of 2.6813 trillion won for the year.

The asset size increased by 8.2 trillion won (3.4%) compared to the previous year. The main reasons were an increase in equity for directly managed enterprises and an increase in liabilities related to development projects by local public corporations.

Liabilities grew by 4.3 trillion won during the same period, mainly due to increased borrowings by development corporations in the capital region as a result of new town construction. The debt ratio rose by 1.5 percentage points to 39.3%, compared to 37.8% the previous year.

The net loss for the year increased by 59.8 billion won. This was influenced by low rates charged by directly managed enterprises, such as water and sewage services, and by urban railway corporations, relative to their costs.

Based on settlement data from the past three years, the Ministry of the Interior and Safety evaluated various financial indicators and designated 105 institutions as key debt management institutions. The ministry plans to require these institutions to establish and disclose five-year financial and debt management plans, including debt reduction and profitability improvement measures.

Among the key debt management institutions, 24 with higher financial risks were designated as targeted debt reduction institutions for intensive management. The ministry intends to closely monitor these institutions by reflecting the appropriateness of their financial and debt management plans, their implementation efforts, and actual performance in management evaluations.

Han Soonki, Director General of Local Finance and Economy at the Ministry of the Interior and Safety, stated, "The settlement results confirm that the finances of local public enterprises are being maintained in a sound manner," and added, "We will continue to provide support to ensure that local public enterprises can deliver high-quality public services through robust management measures such as the designation of key debt management institutions."

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