South Korea’s national debt rose by 28.5 trillion won ($25 billion) last year from a year earlier as the government increased borrowing to fill its budget gap, the Finance Ministry said Tuesday.

According to a ministry report, the national debt including central and local government borrowing amounted to 420.7 trillion won last year, up from 392.2 trillion won a year earlier.

Central government debt grew by 29 trillion won to 402.8 trillion won in the 2011 fiscal year. Debt owed by local governments is estimated to be around 17.8 trillion won, although the final figure will not be available until the end of June, the ministry said.

“Last year’s increase can be attributed to the issuing of government bonds aimed at filling the gap in government budget spending,” the ministry said.

Reflecting the rise in debt, the ratio of national debt to gross domestic product inched up 0.6 percentage point to 34 percent, the report showed.

Last year, the government’s gross revenue including taxes and other earnings amounted to 270.5 trillion won, up 9.3 trillion won from the previous year. Its gross expenditure came to 258.9 trillion won, an increase of 10.3 trillion won from 2010.

Meanwhile, the government registered a 11.6 trillion won surplus in its consolidated fiscal account but, excluding spending on its social welfare fund operation, it logged a fiscal deficit of about 13.5 trillion won last year, the report showed.

The ministry said the settlement of accounts report will be forwarded to the Board of Audit and Inspection for further review before being sent to the National Assembly by the end of May for final approval. (Yonhap News)