Korea Should Guard Against Debt Exploding on Aging, IMF Says

South Korea can handle a rise in debt spurred by current pandemic spending, but it needs to closely consider its future spending plans to ensure its debt burden doesn’t “explode” as its population quickly grays, according to the International Monetary Fund.

Korea’s government debt load is projected to jump from 53.2% of gross domestic product this year to 69.7% by 2026, according to the IMF Fiscal Monitor released earlier this month. That compares with a decline in the euro area and Japan over the same five years, though their debt levels stand significantly higher.