Repaying the debts of the now defunct Japanese National Railways will eventually cost the government 70.21 trillion yen, the Transport Ministry said April 24.
The new estimate is based on a typical repayment schedule for government debts -- 60 years at 5 percent interest.
The figure announced is contained in documents submitted to the Liberal Democratic Party's committee on the JNR debts. If the new estimate is accurate, the government will have to pay 1.17 trillion yen every year, according to the documents.
The debts, which were taken over by the semigovernmental JNR Settlement Corp., amounted to 25.5 trillion yen in 1987. But with interest, the debts mushroom to 28.1 trillion yen as of this month.
The ministry said it expects the amount to drop to 27.8 trillion yen at the beginning of fiscal 1998 following sales of real estate and Japan Railway shares during the current year. It hopes the figures will be used as a base to find a solution to the problem.
The LDP's committee has been discussing the massive and widening debt since last year and has been aiming to find a solution as early as June. Even if the interest rate is 3 percent for the next 60 years, the total amount necessary to repay the debts according to the ministry's new estimate, would be 55.16 trillion yen, or 920 billion yen per year. Over 30 years at 5 percent interest, the total cost would be 46.43 trillion yen, or 1.55 trillion yen every year.
JNR Settlement has so far made about 5.64 trillion yen through sales of real estate and about 1.56 trillion yen through sales of shares of East Japan Railway Co. and West Japan Railway Co. It is expecting revenues of between 4.5 trillion yen and 5.5 trillion yen from the sales of remaining JR shares and land, the ministry said.