TOKYO Japan's government debt will top 1,100 trillion yen $8.47 trillion for the first time at the end of March 2027, as the country is heavily dependent on borrowing, according to a draft estimate by Reuters on Thursday.
Even assuming a rosy scenario in which the world's third-largest economy grows an annual 3 per cent in nominal terms, the debt would grow to just shy of 1,200 trillion yen at the end of the forecast period ending in March 2033, it showed.
Interest payments would double from 8.6 trillion yen for fiscal 2023 to 17.1 trillion yen by the end of the forecast period, reflecting snowballing debt.
The estimate will be presented to the parliament as a reference for lawmakers' debates on next fiscal year's budget.
The Ministry of Finance, in separate projections released earlier this month, said it could keep new bond issuance at some 32 trillion yen in the next few years.
The projections show that rolling-over bonds have been boosted by rounds of COVID 19 stimulus spending to 150 trillion yen, which will come down to 130 trillion yen in fiscal 2024.