IMF lowers Korea's gov't debt forecasts on improved tax revenue prospects
BANGKOK — The International Monetary Fund (IMF) lowered its forecasts for Korea's government debt to gross domestic product (GDP) ratio through 2031, citing its strong economic growth and prospects for improved revenue conditions, the budget ministry said Wednesday. The Washington-based organization said in the IMF Fiscal Monitor report that Seoul's government gross debt-to-GDP ratio would reach…
The International Monetary Fund (IMF) has reduced its projections for South Korea's government debt-to-GDP ratio, citing robust economic growth and expectations of improved revenue. According to the IMF's Fiscal Monitor report, Seoul's government debt will increase to 46.1% of GDP this year, with projections suggesting it will stay within a mid-40% to low-50% range through 2031.
This represents a significant decrease of 8.3 percentage points from the IMF's April forecast, and a 11.8 percentage point decline from the April 2031 projection. The ratio for 2031 is expected to reach 51.3%, a reduction of 11.8 percentage points from the April estimate. The projected ratio for the current year stands at approximately 37% of the Group of Seven's average of 123.6%, and 43% of the average for the 38 advanced economies.
South Korea's Ministry of Planning and Budget noted that the IMF's latest assessment acknowledges the country's efforts to create a positive feedback loop, where expansionary fiscal policy fuels economic growth, which subsequently generates increased tax revenue.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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