<Anchor> The
IMF of the International Monetary Fund has said there is a concern that the government's debt burden may explode due to a declining population in Korea.
While increasing fiscal spending to respond to the coronavirus outbreak is a legitimate step, future generations may not be able to pay off this debt.
This is Kim Jong-won's correspondent from New York.
<Reporter> The
International Monetary Fund's IMF warned that Korea's debt burden could explode.
Andreas Bauer, deputy director of the IMF Asia-Pacific Bureau and head of the mission in Korea, presupposes that government debt is increasing as fiscal expenditures from the corona rise, which is a valid policy direction in the current situation.
At the same time, there will be no problems for the time being due to the strong foundation of the Korean economy, such as a solid manufacturing industry and high-quality workforce, but it is diagnosed as a problem in the future as the rapid aging process is progressing due to a decrease in population.
Bower said he needed to make plans, such as establishing long-term fiscal policies, so that he could handle the additional debt incurred.
The IMF predicted that Korea's debt earlier this month was 53% of GDP this year, but will increase to 70% by 2026.
Bloomberg reported that this debt outlook for Korea exceeds the average of the G20 countries in the 20 major countries, especially compared to the expected decline in European and Japanese debt in the future.
General Bauer also suggested the necessity of deregulation along with structural reforms in the labor market, such as establishing safety nets for workers as the aging process progressed.