Japan lost its spot as world’s top creditor after 34 years; who took the title? check list

Japan has lost its position as the world’s largest creditor nation for the first time in 34 years, even as its net external assets hit a record high in 2024. According to new data from the finance ministry, Japan was overtaken by Germany in 2024, ending a 34-year streak.

Here’s a breakdown of what happened.

What are net external assets?

Net external assets are the value of a country’s overseas assets (such as investments and loans abroad) minus its foreign liabilities (what it owes to other countries). It's a measure of how much a nation owns abroad versus how much it owes.

What the numbers show

Japan’s net external assets rose 12.9% from the previous year to 533.05 trillion yen ($3.7 trillion) as of the end of last year. However, that wasn't enough to stay ahead of Germany, which posted 569.65 trillion yen in net assets.

Japan had been the world’s top creditor since 1991.

Why did Japan fall behind?

A stronger dollar and euro, which appreciated 11.7% and 5% respectively against the yen in 2024, helped inflate the yen-denominated value of Japan’s overseas holdings. Japanese companies' active overseas mergers and acquisitions also contributed to the gain, the ministry said.

Gross external assets climbed to 1,659 trillion yen, up 169 trillion yen from a year earlier, while liabilities increased by 109 trillion yen to 1,126 trillion yen.

“Net external assets are determined by the accumulation of various factors, including changes in the prices of financial assets and debts as well as the balance of payments,” Finance Minister Yoshimasa Hayashi told reporters.

“In light of these points and the fact that Japan's net foreign assets have been steadily increasing, we do not believe that the change in ranking alone should be taken as a sign of a major change in Japan's position,” he added.

Who else is in the top five?

Mainland China held third place with 516.28 trillion yen in net external assets, followed by Hong Kong at 320.26 trillion yen and Norway at 271.83 trillion yen, according to the ministry.

What about the current account?

The revised data showed Japan’s current account surplus for 2024 stood at 29.4 trillion yen, slightly up from a preliminary estimate of 29.3 trillion yen.