South Korea is expected to face tough challenges now that its population has surpassed the 50 million mark, a senior economic policymaker said Monday.

Vice Finance Minister Shin Je-yoon told an economic strategy coordination committee meeting that the population increase comes amid very low birthrates and rising concerns of reduced growth potential.

“The population will grow for the time being to help create a domestic market for goods, but rapid population aging will trigger various social problems and lead to greater welfare outlays,” he said.

“A rise in households made up of senior citizens can affect economic vitality, making it imperative that the country comes up with a strategy to deal with retirees.”

Shin stressed that there is a need to improve the country’s fiscal health in order to prepare for such future social developments.

The government said South Korea’s total population hit the landmark figure on Saturday, making it the 26th country in the world to reach this figure.

The official said while the rising number of people poses fresh challenges, it also means Asia’s fourth-largest economy is the seventh country in the world after Japan, the United States, France, Italy, Germany and Britain to have population of 50 million and per capita income of $20,000.

“This feat signifies that the country’s has reached a ‘steady growth level’ and is ready to move forward,” he said.

He pointed out that all other countries that reached this milestone have been able to push up their per capita income to $30,000 in the following years. The official said having a large population creates demand and consumption, which can spur production and permit locally made goods to expand into overseas markets. (Yonhap News)