National, Household, and Corporate Debt Approaches 5,000 Trillion Last Year... Record High

Analysis Data of Rep. Choo Kyung-ho from People Power Party
This Year, Due to the Impact of COVID-19, There Were Four Supplementary Budgets... Debt Pressure Expected to Increase

[Image source=Yonhap News]

[Sejong=Asia Economy Reporter Kim Hyunjung] It has been revealed that the debt of all economic entities in Korea, including the government, households, and corporations, approached 5000 trillion won last year, marking an all-time high.

According to data analyzed by Choo Kyung-ho, a member of the National Assembly's Planning and Finance Committee from the People Power Party, last year's national debt was 2198 trillion won, household debt was 1600 trillion won, and corporate debt was 1118 trillion won, totaling 4916 trillion won. This estimate is based on data from the Ministry of Economy and Finance and the Bank of Korea. The national debt figure includes official government debt, public institution debt, and pension liabilities for public officials and military personnel, representing the total amount of debt the government is responsible for.

In 2019, the official government debt was 728.8 trillion won, which was 38.0% of the Gross Domestic Product (GDP). Based on the total population of Korea in 2017, this amounts to 14.09 million won per person and 36.23 million won per household. Public institution debt, calculated based on institutions with assets exceeding 2 trillion won or those requiring government loss compensation, was 525.1 trillion won, accounting for 27.4% of GDP.

Pension liabilities amounted to 944.2 trillion won, representing 49.2% of GDP. The total government responsibility debt, combining government debt, public institution debt, and pension liabilities, was 2198.1 trillion won, equivalent to 114.5% of GDP. Divided per citizen, this is 42.51 million won, and per household, it reaches 109.27 million won. Government responsibility debt has shown an increasing trend, reaching 1609 trillion won in 2013, 1879.9 trillion won in 2016, 2001.2 trillion won in 2017, and 2124.1 trillion won in 2018, influenced by fiscal execution and other factors.

Regarding official government debt, it surged to 846.9 trillion won this year due to four supplementary budgets prepared to manage the COVID-19 pandemic. It is expected to increase to 952.5 trillion won in 2021 and 1077.8 trillion won in 2022.

Household and corporate debts also reached record highs. In 2019, household debt (household credit) was 1600.3 trillion won, accounting for 83.4% of GDP. This equates to 30.95 million won per person and 79.55 million won per household. Notably, mortgage loans accounted for 842.9 trillion won of this amount. Household debt, which was around 472.1 trillion won in 2003, increased to 723.5 trillion won in 2008 and surpassed 1000 trillion won in 2013, reaching 1019 trillion won. It has steadily increased since then, reaching 1637.3 trillion won as of the second quarter this year.

Corporate debt, which includes loans extended by deposit-taking institutions to non-financial corporations, was 1118 trillion won last year, representing 58.3% of GDP. Corporate debt rose from 705.8 trillion won in 2013 to 871 trillion won in 2016 and exceeded 1000 trillion won at 1026.7 trillion won in 2018. As of the second quarter, it reached 1233.8 trillion won.

This content was produced with the assistance of AI translation services.