Japan has lost its status as the world’s largest net creditor nation for the first time in 34 years, with Germany claiming the top spot, according to data from Japan’s Ministry of Finance reported by Bloomberg.
Despite Japan’s record overseas assets, its net external holdings were surpassed by Germany’s, marking a historic shift. Japan had held the number one position since 1991, when it overtook Germany.
At the end of 2024, Japan’s net external assets reached a record ¥533.05 trillion (approximately $3.7 trillion), a 13% increase from the previous year. However, Germany’s assets stood even higher at ¥569.7 trillion. China remained in third place, with ¥516.3 trillion in net external assets.
Germany’s ascent is largely due to its robust current account surplus, which amounted to €248.7 billion in 2024—driven by strong trade performance. In contrast, Japan recorded a current account surplus of ¥29.4 trillion (around €180 billion).
This shift reflects not just Japan’s steady asset growth, but also stronger international demand and surpluses from other nations, particularly Germany and China.
A country’s net foreign assets measure the gap between what it owns abroad and what foreigners own domestically, accounting for currency fluctuations. Notably, the euro appreciated about 5% against the yen last year, magnifying Germany’s asset lead when converted to yen.
Japan’s Finance Minister Katsunobu Kato downplayed the significance of the change, telling reporters on Tuesday that Japan’s continued growth in net assets shows that the country’s global financial strength remains intact.
He noted that both Japan’s foreign assets and liabilities increased in 2024, with the asset side seeing stronger growth due to expanded overseas investments, particularly influenced by the weaker yen.
The Ministry of Finance’s data also showed strong Japanese foreign direct investment during 2024—particularly in the United States and the United Kingdom—focused on sectors such as finance, insurance, and retail.
