Corporate debt ratio rises one notch to 3rd in the world… Household debt ratio still ranks 1st despite slight decline

It was found that Korea’s corporate debt level rose from 4th to 3rd in the world in 3 months, and the rate of increase was at the 2nd to 3rd place in the world. It is interpreted that even though high interest rates continue, domestic companies’ debt has grown larger and their interest burden has increased.

Although the ratio of household debt to gross domestic product (GDP) has fallen slightly, it still ranks first in the world, and government debt is at a mid- to low-level level, but the rate of increase has been rapid.

According to the World Debt Report for 34 countries (a single statistic for the euro area) published by the International Finance Association (IFF) on the 16th on the 19th, Korea’s corporate debt-to-GDP ratio in the third quarter of this year was 126.1%, followed by Hong Kong’s 267.9%. , ranked third in the world after China (166.9%).

Compared to the second quarter (120.9%), the ranking rose by 5.2 percentage points, surpassing Singapore, which fell from 130.2% to 125.0%. Korea’s increase was the second largest in the world after Malaysia (28.6% points).

Compared to the third quarter of last year, Korea’s corporate debt ratio increased by 5.7 percentage points, the fastest increase after Russia (13.4 percentage points) and China (8.6 percentage points). Countries where corporate debt ratios increased over the past year include Russia, China, Korea, Saudi Arabia (5.5% points), India (2.6% points), Vietnam (2.5% points), Kenya (1.2% points), and South Africa (0.3% points). points), and Egypt (0.1% point).

The euro area decreased by 8.0% points, and corporate debt also decreased in the UK (-3.6% points), Japan (-2.5% points), and the United States (-2.2% points).

Korea’s household debt-to-GDP ratio in the third quarter of this year was 100.2%. It fell by 1.5 percentage points and 4.6 percentage points from the second quarter of this year (101.7%) and the third quarter of last year (104.8%), respectively, but has maintained first place since 2020.

Korea was the only country among the target countries to have a household debt-to-GDP ratio exceeding 100%. Second and third places were Hong Kong (95.2%) and Thailand (91.5%).

Korea ranked 22nd in the government debt-to-GDP ratio at 48.9%, but the increase compared to a year ago (4.7% points) was 4th, following Hong Kong (23.3% points), Argentina (8.1% points), and China (7.1% points). It was the second highest.

The country with the highest ratio of government debt to GDP was Japan (239.9%), followed by Singapore (170.8%), the United States (117.6%), and Hong Kong (103.4%).

IFF predicted that global debt will reach $310 trillion by the end of this year. It has increased by 25% over the past five years, and he warned that if populist politics in each country continues, the scale could grow further next year.