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South Korea Debt Fix Risks Hurting Economic Growth Trend

  • Debt accounts for 143% of disposable income through September
  • Household debt growth supported property market this year

After years of struggling to curb household debt, South Korean policy makers have devised a plan that economists say will work. Yet it is likely to come at a cost: Hurting the drivers of the nation’s growth.

South Korea’s household debt rose to a record 1,166 trillion won ($992 billion) at the end of September, a 10 percent increase from the previous year. That debt now accounts for 143 percent of aggregated disposable income, central bank data shows.