Japan is one of the most indebted countries in the world, with a public debt of $9.2 trillion, which represents 266% of its gross domestic product (GDP), according to the Spanish newspaper El Economista.
The newspaper pointed out that one of the reasons that led to this hefty volume of debt is that the state has spent decades boosting domestic spending to keep its economy going.
However, Japanese citizens and companies that play a major role in economic growth are very reluctant to consume, and the state is often forced to spend on them.
“Private savings are huge and investment is weak, which implies chronically weak demand,” said Takeshi Tashiro, an expert at the Peterson Institute for International Economics.
He explained that “one of the reasons for this problem is Japan’s demographics' defects, and its people live very long,” which increases social security costs.
And government health care and this also causes retirees to have a lot of uncertainty about their future and they prefer to save.
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