November 06, 2012 13:32
A sprawling English-language education facility built with taxpayers' money in Ansan, Gyeonggi Province will close to prevent due to snowballing losses. The Gyeonggi provincial government said on Monday it will not renew the contract with a private operator of the village, which expires on Nov. 2.
Opened to great fanfare in August 2004, Korea's 1st "English Village" was built by the government where students were supposed to learn the language by "immersion" in a wholly English-speaking environment.
The aim was to prevent youngsters from being sent to school overseas.
But a real estate slump and the recession have cut tax revenues, prompting Gyeonggi Province to shed money-losing projects.
The village posted a loss of a staggering W11.8 billion (US$1=W1,091) in its first year. In 2005, losses grew to W18.2 billion, but shrank to W3.3 billion in 2006. Gyeonggi Province entrusted a private operator with the management in 2008, but earnings did not improve much. After posting a W1.1 billion loss in 2009, the village finally posted a meager W90 million profit in 2010 and W35 million profit in 2011.
The dire financial situation has meant that repairs and renovations have been out of the question. A Gyeonggi Province official said, "We need at least W1-2 billion to repair aging facilities, but we see no reason to spend more money to keep the village open."
A surge in the number of similar facilities across the country has also increased competition, making it tougher to recruit students, the official added.
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