South Korea's Total Debt Breaks 6500 Trillion Won Mark, Surging Government Debt Raises Concerns

The total debt in our country has surpassed 6.5 quadrillion won for the first time. According to data from the International Financial Institute, Korea’s government debt as a percentage of GDP has risen to 48.6%, reaching a record high.

By the end of last year, the total credit in the non-financial sector exceeded 6.5 quadrillion won, indicating that the overall economic debt level has reached a serious point. This figure increased by about 280 trillion won (4.5%) compared to the end of 2023, with government debt growing the fastest.

Experts point out that although Korea’s debt growth rate is relatively slow compared to other major countries, its acceleration is rapid. Especially, government debt increased by 9.8%, highlighting its prominent role in the overall economic leverage.

This suggests that expansionary fiscal policies and government spending are becoming factors that stimulate inflation. This is also consistent with the Korean Bank’s observations, which indicate that expanding fiscal deficits support economic growth but may also increase inflationary pressures.

In the future, this trend of debt growth is likely to continue. Experts particularly warn that if government spending continues to increase, it could raise concerns about fiscal sustainability. This means close attention should be paid to the direction of economic policies and market reactions.