Japan’s public debt continues to rise to a record high

According to the report of the Ministry of Finance Japanwith level public debt is 1.241 trillion yen ($9.538 billion) in fiscal year 2021, Japan’s per capita public debt also surpassed 10 million yen/person for the first time.

Of this record-high public debt, there are more than 1,104 trillion yen in debt in the form of bonds, 50,430 billion yen in loans from financial institutions and 86.2 trillion yen in financial bills or short-term bills with maturities of more than 86.2 trillion yen. term up to 1 year.

The reason for the record increase in public debt was mainly because Japan had to continue to issue bonds to cover the budget deficit, in the context of a sharp decrease in tax revenue, while social security and budget costs to finance the public debt. response to the COVID-19 epidemic continuously increased.

Japan currently has the highest public debt ratio among developed economies with its public debt to Gross Domestic Product (GDP) ratio around 200%. The current high public debt ratio will be a significant obstacle to the recovery plan of the world’s third largest economy.

In fiscal year 2022, Japan’s budget deficit will continue to increase, the Government intends to issue about 37 trillion yen in bonds to cover the budget shortfall. This will certainly worsen the public debt situation.

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