A multi-billion-won donation of gold bars by an anonymous donor to a Japanese local government facing financial crisis has drawn widespread attention.

According to the Yomiuri Shimbun, Hyogo Prefecture announced on September 16 that it received a donation of 35 kg of gold bars from an anonymous individual.

Valued at approximately 834 million yen (about 7.33 billion won), the prefecture explained that the proceeds from selling the gold will be used for regional development as desired by the donor.

The donor first reached out to Hyogo Prefecture for consultation in February and delivered a total of 70 gold bars sequentially through September 8.

To protect the donor's anonymity, the prefecture decided not to disclose their name, age, or motive for the donation.

Hyogo Prefecture has suffered from chronic financial difficulties while overcoming the severe blow dealt by the 1995 Great Hanshin-Awaji Earthquake.

It raised funds for disaster recovery and regional revitalization by issuing large-scale local government bonds, with disaster recovery spending to date reaching 2.3 trillion yen (about 20.2 trillion won).

A total of 113.8 billion yen (about 1.0013 trillion won) in disaster-related local bonds still remains unresolved.

Additionally, rising interest rates have increased the burden of interest payments, raising the possibility that the prefecture could become the country's first major local government to be designated by the government as an "early fiscal soundness entity," a status assigned to municipalities at risk of financial collapse.

After becoming a "bond-issuing permission entity" last month—requiring national approval for issuing local bonds—Hyogo Prefecture announced plans to cut investment costs for road repairs, facility maintenance, and other projects by more than 10 percent starting next year.

The massive donation brings welcome news amid these challenging circumstances. Hyogo Prefectural Governor Motohiko Saito said at a press conference on September 16, "We are deeply grateful for this warm kindness at a time when our financial situation is extremely severe."

Hyogo Prefecture plans to convert the gold into cash following approval by the prefectural assembly and utilize it as a fund.

(Photo: Yonhap News)