Korea’s government budget deficit and liabilities in 2010 came in at less than previously forecast, thanks mainly to faster-than-expected growth in Asia’s fourth-largest economy, the Finance Ministry said on Tuesday.

The government debt grew more than 30 trillion won ($27.6 billion) last year from a year earlier as the government had to expand borrowing to fill its budget shortfalls.

According to a ministry report, the government debt including central and local government borrowing amounted to 392.8 trillion won last year, up 33.2 trillion won from a year earlier.

Central government debt grew 27.7 trillion won to 373.8 trillion won in the fiscal year 2010. Debt owed by local governments is estimated at around 19 trillion won, though the final figures will be available at the end of June, the ministry said.

The increase was attributed mainly to increased issuance of government bonds aimed at filling the gap in government budget spending, the ministry said.

Despite the increased borrowing, the ratio of national debt to gross domestic product inched down 0.3 percentage point to 33.5 percent, the report showed. The debt growth was also 14 trillion won smaller than 407.2 trillion won predicted in the government’s budget plan for last year.

Last year, the government’s gross revenue including taxes and other earnings amounted to 261.2 trillion won, slightly down from 261.1 trillion won the previous year. Its gross expenditure came to 248.7 trillion won, down 3.5 percent from 2009, the report showed.

Meanwhile, the government registered a 29.7 trillion won surplus in its consolidated fiscal account, but excluding the results of social welfare fund operation, it logged about 13 trillion won in fiscal deficit last year, the report showed.

The ministry said that 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.

(From news reports)