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S. Korean public sector debt grows at fastest pace in 5 years in 2019

South Korea's public sector debt (Yonhap)
South Korea's public sector debt (Yonhap)
South Korea's public sector debt climbed at the fastest clip in five years in 2019 to exceed the 1,100 trillion-won ($1 trillion) mark, the government said Thursday.

The country's public sector debt, known as D3, which includes the debt of the central government and state-funded firms, came to 1,132.6 trillion won as of end-2019, up 5.1 percent, or 54.6 trillion won, from the previous year, according to the Ministry of Strategy and Finance.

The on-year increase in the public debt represents the highest growth rate since the 6.5 percent gain recorded in 2014.

The 2019 tally accounted for 59 percent of the country's gross domestic product last year, up 2.2 percentage points from a year earlier.

General government debt (D2), which covers the central and provincial governments, and nonprofit public institutions, reached 810.7 trillion won, up 6.7 percent, or 51 trillion won, from a year earlier.

Its percentage of the GDP climbed 2.2 percentage points to 42.2 percent last year.

The ministry said general government debt increased in 2019 from the prior year due to a decline in tax revenue and increased government bond sales.

Asia's fourth-largest economy had the sixth-lowest D2-to-GDP ratio among 33 members of the Organization for Economic Cooperation and Development (OECD). The OECD average stood at 110 percent. (Yonhap)

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