State bonds issuance hits record high in 2013

South Korea issued a record amount of government bonds last year as part of efforts to kick-start the economy and finance its welfare projects, data showed Sunday.

According to the data by the Korea Financial Investment Association and Dongbu Securities Co., state bonds worth an all-time high of 135.7 trillion won ($128 billion) were floated last year, up 21.4 percent from the previous year.

The amount of state bonds issued per year has been growing sharply since 2011, when it breached the 100 trillion won mark for the first time.

"Despite calls for fiscal soundness, the government was forced to sharply increase bond issuance due to the sluggish economy and a growing need for welfare spending," an analyst at Dongbu Securities said.

Meanwhile, public institutions and private companies cut their debt sales last year from a year earlier, according to the data.

The issuance of special bonds floated by state-run institutions tumbled 17.3 percent on-year to 88.4 trillion won, with corporate debt sales dropping 13.1 percent to 66.7 trillion won, the data showed. (Yonhap News)