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That doesn't sound like a bad thing.
population decline is better for the environment, but terrible for social services. If it gets to an extreme level, suicide rates of elderly would spike (which in South Korea, is relatively speaking, higher than the rest of the world)
It is a bad thing for that countries economy. Populations where elderly people are disproportionate to younger people require an unusually high number of care takers, and those caretakers are not participating in careers that maintain or increase the countries standard of living. So for instance, there may be fewer people working on maintaining roads and infrastructure, which means the quality of those things will decline. If you apply that thinly across everything except elder care, you get increased scarcity across the board, which generally increases costs while decreasing quality.
Governments might have thought of that when they were spending decades endorsing wealth inequality and subsidizing everything from the top. Why make more people when life's already not worth living and everything continues to get worse at an accelerating rate?
Politicians aren't known for their morality and selflessness.
Or especially their ability to think long term.
Basically if there are more older people in a society that need assistance and not enough working age people to assist them, it quickly becomes very problematic for the government. They are forced to scramble to do things like incentivise having children as well as attract foreign workers. If you don't do this, older people will accuse you of abandoning them after they supported the country their whole life by paying taxes and not breaking the law etc. However, on the other hand, doing these things is expensive and can put huge strain on the country's finances / economy.
It basically becomes a choice between losing votes and support of older generations or putting the country in a huge economic decline.
This is made worse too by the country's unique culture and language. Something like this isn't such a big deal in a place like say Canada, where it's easier to get foreign workers into the country to fix this because they would all most likely speak English. However Korean is not a popular language outside of Korea. Getting in foreign workers as a temporary fix also comes with the challenge of teaching them about the culture, language, customs etc. It's not as easy.
TLDR: This could cripple a lot of Asian countries if not dealt with.
Lower population isnt but the reasons why the population is declining are.
People are essentially shamed into perpetuating a poisonous work culture that makes people not have the time or resources to support a family even if they wanted to and there seems to be no sign of that changing.
On top of economic concerns there's also infrastructure concerns. Small towns don't have metro stations, or massive power grids, or skyscrapers. These things are far too expensive to maintain for how little use a small population would get out of it. So what happens if a metropolitan city suddenly has the population of a small town? All the infrastructure of that city is now way too big and expensive to maintain. The city would need to spend a lot of time and money downgrading their infrastructure. It's much better for populations to increase or decrease gradually rather than a huge sudden change.
On top of what @friend_of_satan said, countries will not be able to keep up with their current productivity on top of the aged out work-force. This means their GDP will fall severely.
This is a really big deal for most of the world economically and we've already passed the point where we could mitigate it.
This reads like my first troll account