Public agency debt is projected to rise to 997.4 trillion won by 2030 due to the expansion of policy projects in housing and energy. In particular, the Korea Land and Housing Corporation (LH) is expected to lead this increase, with its debt soaring to 372.8 trillion won by 2030 as a result of expanded housing supply and increased rental housing projects.
On September 1, the Ministry of Economy and Finance reported these findings during the 10th Public Agency Operation Committee meeting, chaired by Deputy Minister Heo Chang. The long-term financial management plan will be submitted to the National Assembly on September 3.
The plan covers 37 agencies with assets exceeding 2 trillion won or those with government loss compensation clauses in their founding laws. The Korea Workers' Compensation and the Korea Environmental Industry and Technology Institute have been newly included as target agencies starting this year.
The total debt of these 37 agencies is expected to increase by 219.1 trillion won, from 778.3 trillion won in 2026 to 997.4 trillion won in 2030. The debt ratio is also projected to rise from 208.2% to 216.6% during the same period.
LH is the main driver of this overall debt increase. Its debt is anticipated to grow by 175.3 trillion won, from 197.5 trillion won in 2026 to 372.8 trillion won in 2030. The debt ratio is expected to rise from 250.6% to 351.2%, an increase of 100.6 percentage points.
To expand housing supply, LH plans to significantly increase new housing construction and continue its rental housing projects in line with demand. This will likely lead to a greater financial burden due to the increased volume of rental housing to manage.
Excluding LH, the debt of the remaining 36 agencies is expected to rise by 43.9 trillion won, from 580.7 trillion won in 2026 to 624.6 trillion won in 2030. However, their debt ratio is projected to improve from 196.8% to 176.2%, a decrease of 20.6 percentage points.
The government and public agencies are committed to expanding policy projects while also improving financial soundness. Key initiatives include LH's rapid housing construction and rental expansion, early establishment of energy highways for stable power supply, and increased investment in renewable energy. Support for small businesses and venture companies will also continue.
Major agencies such as Korea Electric Power Corporation, LH, and the Korea Expressway Corporation plan to enhance policy investments while also pursuing financial improvement efforts through expenditure restructuring and revenue enhancement.
The government will encourage agencies that require focused financial management to enhance their investment capacity and strengthen evaluations of compliance. During the preliminary feasibility study process for large-scale projects, the appropriateness of investment costs will be closely examined to prevent financial leakage.
Deputy Minister Heo Chang emphasized, "As the financial conditions of public agencies are expected to deteriorate in the future, each agency should strengthen monitoring of financial risk factors such as exchange rates and oil prices, and continuously identify and implement self-improvement efforts."
* This article has been translated by AI.
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