The combined debt of the government and households in South Korea has surpassed 3,000 trillion won ($2.26 trillion) for the first time, driven by lower tax revenue, increased bond issuance, and aggressive borrowing from households for real estate investments, government data showed Sunday.
According to data from the Korean finance ministry and the central bank, the country’s combined national debt and household debt reached a record 3,042 trillion won as of the end of the second quarter. This amounts to approximately 127 percent of last year’s nominal GDP of 2,401 trillion won.
The national debt increased by 30.4 trillion won from the previous quarter to 1,146 trillion won amid various factors, such as the sluggish economy and ongoing tax revenue shortfalls.
Household debt surged to a record high of 1,896 trillion won, due to the recent recovery in housing transactions, which has driven up related loans.
National debt primarily consists of government bonds, loans, and financial obligations, with governmen
t bonds making up the majority. Household debt encompasses loans from banks and insurance companies.
The combined debt of the government and households increased by 44 trillion won in the second quarter from the previous quarter, compared with a 20 trillion-won rise in the first quarter.
It marked the largest quarterly increase since the third quarter of 2021, when the COVID-19 pandemic was at its peak.
Source: Qatar News Agency