Japan Finished March With Debt of 1.02 Quadrillion Yen
According to their Finance Ministry, Japan finished the first quarter of the calendar year with 1.02 quadrillion Yen in debt, which is an all-time high for the country.
According to the report from the Finance Ministry, Japan's debt increased 7.01 trillion Yen from the end of December due to rising social security costs associated with the nation's aging population.
In case you were wondering (and you probably were), 1.02 quadrillion yen works out to roughly $10 trillion USD. Given Japan's population of approximately 127 million people, this means that each and every citizen of Japan owes roughly 8.06 million Yen as their share of the debt, or around $79,181.44 USD.
The United States, on the other hand, has a total national debt of approximately $17.47 trillion, which means that each and every citizen owes approximately $57,507 as their share of the debt.
Japan's numbers become especially distressing when you consider that their economy is approximately 36% the size of the United States. There are many economists and analysts who believe that the world's next "black swan" will be the implosion of Japan due to fiscal strain. After all, Japan has a massive debt load and aging population. Can the nation support an aging population and the associated costs? Who will be expected to continue funding the nation's deficit spending? Japan has been fortunate in that they have largely relied on their own population to fund their deficit spending - many Japanese citizens have sunk a large portion of their net worths into government bonds, but can this be expected to continue? That is the $64,000 question.
Shinzo Abe, Japan's current prime minister, introduced "Abenomics" as a way of jump-starting the country's economy in order to get the nation on more solid financial footing. However, these reforms have "taken hold slowly" in the words of Taro Aso, Japan's Finance Minister. This is creating additional strain on a country that is already in a precarious financial position.
Over the next 10-20 years, Japan's financial situation will become increasingly interesting to watch. Will they eventually implode, as is what many expect, or will they get their spending situation under control?
Source: The Japan News - National Debt Hits Record High
Filed under: General Knowledge