Consecutive COVID-19 Emergency Budgets... National Debt Per Person Approaching 20 Million Won

In 2014, National Debt Per Capita Surpassed 10 Million KRW for the First Time
National Debt Increased by 400 Trillion KRW During 5 Years of Moon Administration

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] It is projected that this year, the national debt per capita will exceed 20 million KRW. This is due to the successive supplementary budgets prepared in response to the COVID-19 crisis. During the Moon Jae-in administration, the national debt increased by more than 400 trillion KRW over five years. Going forward, fiscal soundness is expected to deteriorate further due to factors such as low birth rates and aging population.

According to the National Debt Clock of the National Assembly Budget Office on the 16th, the current national debt per capita is 18.61 million KRW. This figure is calculated by dividing the national debt (D1), which is the sum of central government debt and net local government debt, by the resident registration population.

Based on this year's main budget, the national debt will exceed 1,000 trillion KRW for the first time, reaching 1,064.4 trillion KRW.

Considering the issuance of more than 10 trillion KRW in deficit bonds for the first supplementary budget this year, the national debt will reach at least 1,074.4 trillion KRW.

Dividing this by last year's resident registration population, the national debt per capita this year is calculated to increase to 20.81 million KRW.

The national debt per capita first surpassed 10 million KRW in 2014 at 10.39 million KRW, then exceeded 12 million KRW in 2016. It increased to 13.13 million KRW in 2018.

In 2020, the national debt per capita sharply increased by 17.1% from the previous year to 16.33 million KRW. Since then, it has continued to grow at an annual rate of over 10%, surpassing the 20 million KRW mark in 2022.

The rapid increase in national debt since 2020 is largely due to the impact of the COVID-19 crisis.

During the process of allocating funds for quarantine measures and support for small business owners, the issuance of deficit bonds increased significantly. Amid successive supplementary budgets, disaster relief funds were also provided to the bottom 80% income earners.

The national debt, which was 660.2 trillion KRW in 2017 when the Moon Jae-in administration took office, increased by more than 400 trillion KRW over five years, reaching 1,064.4 trillion KRW based on this year's main budget, the final year of the administration.

There are concerns that debt will increase further in the future. The possibility of additional supplementary budgets and demographic changes such as low birth rates and aging population may further worsen fiscal soundness.

Meanwhile, the government projected in the 2021?2025 National Debt Management Plan announced last year that the national debt will continue to increase not only this year but also in the coming years, reaching 1,408.5 trillion KRW by 2025.