South Korea's public sector net lending hit a record high last year, thanks to a robust gain in tax revenues and lower oil prices, data showed Wednesday.

Net lending, which refers to total revenue minus total expenditures, came to 43.9 trillion won ($38.4 billion) in 2016, compared with 32.9 trillion won from a year earlier, according to preliminary data from the Bank of Korea.

It was the highest annual net lending since the central bank began compiling statistics on the public sector account.

Last year, total revenue in the public sector rose 4.1 percent on-year to 765.1 trillion won, while total expenditures climbed 2.7 percent on-year to 721.2 trillion won.
 

Kim Seong-ja, an official at the central bank, attributed the rise in public sector net lending to a growth in tax revenues and spending cuts on lower oil prices.

Tax revenues jumped by 27.9 trillion won to 319.1 trillion won last year.

The central government posted a deficit of 14 trillion won last year, down from 29.5 trillion won in the red in 2015.

The deficit of central and provincial governments in South Korea accounted for 0.5 percent of the nominal gross domestic product in 2016, compared with an average 3 percent among member countries of the Organization for Economic Cooperation and Development, according to the central bank data.

Public sector's total expenditures accounted for 44 percent of the nation's nominal gross domestic product last year, down 0.9 percentage point from 2015.

"Even though nonfinancial public corporations reduced their investments and intermediate consumption due to the drop in oil prices, general government sector spending increased significantly due to social insurance expenses," the central bank said in a statement. (Yonhap)