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Debt service and retirement costs are swallowing Japan's budget

23 Mar 2011 by Jim Fickett.

Here are two rather shocking graphs I came across today. The first shows the build-up of gross government debt in Japan, compared to some other major economies (click for larger image):

And the second shows how the demographic trend and the debt service expenses are crowding out other spending from the budget. Together social security and interest on the debt now comprise over half of government expenditures, and that is with interest rates still incredibly low!

Both of these are from an appendix, “Japan's Fiscal Condition”, in the February Monthly Finance Review from the Ministry of Finance.