BOK’s Rhee Warns of Fertility Crisis Leading to Rise of Populism

Bank of Korea Governor Rhee Chang-yong warned that the country’s demographic crisis could spawn a cycle of fiscal inefficiency with the government relying increasingly on populist steps such as cash handouts and temporary welfare benefits.

“Stagnant growth exacerbates income inequality, deepens generational and class divides, and fuels political polarization,” Rhee said in a keynote speech at a forum on sustainable development in Seoul on Friday. “Politicians and governments may resort to populist fiscal policies, such as direct cash handouts and temporary welfare measures, providing short-term relief without addressing underlying issues.”