2020 External Debt
External Debt Amounts to US $542.4 Billion,
Soundness Indicators Remaining Stable
Korea’s external debt amounted to US $542.4 billion as of the end of 2020, rising US $75.5 billion from a year ago.
- Short-term debt: US $157.5 billion, up US $23.0 billion year-on-year
- Long-term debt: US $385.0 billion, up US $52.5 billion year-on-year
External Debt, 2020
(US $billion)
|
|
2008
|
2010
|
2018
|
2019
|
2020
|
(y-o-y)
|
|
Total debt
-Short-term
-Long-term
|
314.1
146.8
167.2
|
354.7
135.0
219.7
|
441.2
125.6
315.6
|
467.0
134.5
332.5
|
542.4
157.5
385.0
|
75.5
23.0
52.5
|
* Source: International Investment Position (IIP) at the end of 2020 (preliminary, Bank of Korea, February 19, 2021)
External debt expanded due to a rise in bank borrowings amid the pandemic, as well as growing foreign investment in Korea treasuries and other government debt. Corporations also increased their issuance of long-term foreign bonds.
Government borrowings (up US $28.8 billion) went up as foreign investment in government debt rose and partly due to the strong won, which raises the level of debt when converted into US dollars. Central bank borrowings (up US $0.5 billion) rose in line with an increase in foreign investors’ bond holdings. Borrowings by banks (up US $27.5 billion) grew as both short-term funding and long-term debt issuance expanded. Borrowings by the other sector (up US $18.7 billion) rose due to increased issuance of long-term corporate bonds and foreign currency deposit growth.
Soundness
External debt soundness indicators worsened somewhat as the ratio of short-term external debt to total external debt went up 0.2 percentage points to 29.0 percent and the ratio of short-term external debt to foreign exchange reserves rose 2.6 percentage points to 35.5 percent. Although increased, the soundness indicators are still stable, and expected to improve as the pandemic situation gets better.
Solvency
Net foreign assets in debt instruments (total external assets in debt instruments－total external debt) edged down by US $2.4 billion to US $478.2 billion.
Short-term External Debt and External Assets in Debt Instruments
(%, %p, US $billion)
|
|
2008
|
2010
|
2018
|
2019
|
2020
|
Change
(y-o-y)
|
|
Ratio of Short-term Debt to Total External Debt
|
46.8
|
38.0
|
28.5
|
28.8
|
29.0
|
0.2¹
|
|
Ratio of Short-term Debt to Foreign Exchange Reserves
|
73.0
|
46.3
|
31.1
|
32.6
|
35.5
|
2.6¹
|
|
External Assets in Debt Instruments
|
340.6
|
450.6
|
918.8
|
947.6
|
1,020.7
|
73.1
|
|
Net External Assets in Debt Instruments
|
26.5
|
95.9
|
477.6
|
480.6
|
478.2
|
-2.4
|
1. %p
The government will continue to closely monitor the external debt situation and the global financial markets as there are pandemic-related uncertainties, such as delayed vaccine doses, as well as mutation concerns.
Please refer to the attached pdf
