Seoul, South Korea – South Korea's total national debt has exceeded 6,200 trillion won, with government debt showing the most significant recent increase, according to data released by the Bank for International Settlements (BIS).
As of the end of the third quarter of 2024, South Korea's non-financial sector credit stood at 6,222 trillion won, marking a substantial rise from previous periods. This comprehensive figure includes the combined debts of households, corporations, and the government, providing a holistic view of the nation's overall debt burden.
The escalating debt levels have been a consistent trend, with the total debt first surpassing 5,000 trillion won during the early stages of the COVID-19 pandemic in the first quarter of 2021. This upward trajectory continued, culminating in the total debt exceeding 6,000 trillion won by the end of 2023.
A breakdown of the debt by sector reveals that corporate debt holds the largest share, totaling 2,798 trillion won. Household debt follows at 2,283 trillion won, while government debt amounts to 1,141 trillion won. Notably, government debt has experienced the most rapid growth, increasing by approximately 120 trillion won (11.8%) in the past year.
Despite the rising total debt, the ratio of total debt to GDP has shown a declining trend. This ratio, which peaked in the second quarter of 2023, has since fallen for five consecutive quarters, indicating a relative improvement in the nation's debt management.
Although, the Government debt increase rate is the highest of the three groups. More information will be needed to evaluate the long term effects of this increase.
[Copyright (c) Global Economic Times. All Rights Reserved.]
