Suwon's Debt Reaches 36.3 Billion Won...Third in Gyeonggi Province

Suwon, with a population of 1.1 million, has emerged as the local government with the second-largest asset size in Gyeonggi Province, following Seongnam. With total assets exceeding 12 trillion won—large enough to forego central government support—the city revealed financial management problems with debt reaching 36.3 billion won.

On the 7th, the Ministry of Interior and Safety released a "Basic Financial Status Report" analyzing the assets and debt of 246 local governments nationwide. The Basic Financial Status Report, based on the accrual accounting and double-entry bookkeeping system fully implemented nationwide starting in January of last year, compiled aggregate financial data from each local government based on actual surveys of various assets and debt as of the end of 2006.

According to the report, Seongnam City held the highest assets among basic-level local governments not only within Gyeonggi Province but nationwide, at 16.4554 trillion won. Suwon ranked second in the province with total assets of 12.4229 trillion won. Following in order were Goyang (11.2766 trillion won), Ansan (7.0164 trillion won), Yongin (6.0968 trillion won), and Anyang (6.0795 trillion won). The local government with the smallest asset size was Gapyeong County (789.6 billion won).

Meanwhile, local governments with larger asset sizes were found to have higher debt ratios. Among basic local governments in Gyeonggi Province, Siheung had the most debt at 588.8 billion won, followed by Seongnam (52.8 billion won), Suwon (36.3 billion won), Ansan (29.4 billion won), and Bucheon (21.4 billion won). Gwacheon had the least debt at 5.1 billion won.

Unlike enterprises, the asset size in this basic financial status refers to resources with the potential to generate direct and indirect future cash flows and provide public services, as the primary purpose is public service provision. Current assets, investment assets, general fixed assets, public convenience facilities, infrastructure, and other non-current assets correspond to double-entry bookkeeping assets. Therefore, the greater the holdings of infrastructure and similar assets, the larger the asset size becomes.

Meanwhile, the total assets of 246 local governments were tallied at 79.41874 trillion won, and total debt at 29.2606 trillion won, which represents 3.7% of total assets. Gyeonggi Province showed the highest total assets at 26.0290 trillion won with debt of 3.5048 trillion won. Per capita assets by local government tier showed Gyeonggi Province at 4.88 million won, municipal governments as basic local governments at 11.78 million won, counties at 20.78 million won, and autonomous districts at 3.68 million won. Debt per capita was 350,000 won for Gyeonggi, 340,000 won for cities and counties, and 50,000 won for autonomous districts.