Hyogo Faces Belt-Tightening After Fiscal Downgrade
Hyogo Governor Motohiko Saito said on August 19 that the prefecture's shift to a status requiring central government permission to issue bonds would not immediately halt public projects, while stressing that years of high public investment, funding shortfalls and what he described as improper land-acquisition bond practices under former Governor Toshizo Ido had contributed to the deterioration of…
Hyogo Prefecture faces fiscal challenges following a downgrade, as it has been classified as a bond-issuance permit entity. Governor Motohiko Saito stated that this status, triggered by a real debt service ratio exceeding 18%, will not immediately halt public projects but will require formal permission for bond issuance procedures.
The prefecture has managed to record a real-account surplus for fiscal 2025, largely due to strong corporate performance and robust tax revenue. However, Saito attributes the worsening debt ratio to issues such as high public investment levels, a large funding shortfall in the debt management fund, and improper land-acquisition bond practices.
The prefecture plans to prepare a debt-service burden optimization plan, aiming to reduce the real debt service ratio below 25% and ultimately below 18%.
Brief written by urgent.news from News On Japan's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
