By 2030, deficit-creating debt that the public must repay is forecast to swell by more than 280 trillion won from this year to the 1,300 trillion-won range. As national debt increases, the annual interest costs are also expected to exceed 50 trillion won.
According to next year's budget plan released on the 6th by the Ministry of Planning and Budget, deficit-creating debt will reach 1,117.1 trillion won, up 91.9 trillion won from this year's supplementary budget basis (1,025.2 trillion won). The increase is projected to continue, hitting 1,192.4 trillion won in 2028, 1,245.8 trillion won in 2029, and 1,312.3 trillion won in 2030. That means an increase of 287.1 trillion won in four years compared with this year's supplementary budget.
However, both the size and share are lower than the previous midterm plan's outlook of 1,248.1 trillion won (75.0%) for 2028 and 1,362.5 trillion won (76.2%) for 2029. This is seen as the effect of higher revenue due to robust tax receipts from the semiconductor boom.
Over the same period, financial debt will rise only by 34.3 trillion won, from 387.6 trillion won to 421.9 trillion won, so the share of deficit-creating debt in total government debt will climb from 72.6% this year to 75.7% in 2030, while the share of financial debt will fall from 27.4% to 24.3%.
Deficit-creating debt has no corresponding asset to repay it and must effectively be covered by the public, so the fact that it is growing faster than financial debt is also read as a sign that the quality of government debt is deteriorating.
Meanwhile, the outlook for deficit-creating debt, which has been included every year in related documents since 2006, was omitted from the Government Debt Management Plan submitted this year. The Ministry of Planning and Budget said the item was excluded while redesigning the plan's format and that other content, such as international comparisons, was included instead.
The rise in interest costs is also pronounced. This year's government debt interest costs are 36.5 trillion won, up 4.8 trillion won from last year, and they are expected to grow to 42.8 trillion won next year, 45.4 trillion won in 2028, 48.9 trillion won in 2029, and 53.3 trillion won in 2030.
As a share of gross domestic product (GDP), the figure will rise from 1.3% in 2026 to 1.5% in 2030, and the government set a goal of keeping it below the Organization for Economic Cooperation and Development (OECD) average (2.0% this year, 2.1% next year). Powered by economic expansion, the ratio of government debt to GDP is expected to fall from 50.6% on this year's supplementary budget basis to 48.3% next year, then reach 48.8% in 2029 and 49.0% in 2030, which is an improvement of 9.0 percentage points from the previous plan's 2029 outlook of 58.0%.