Japan lost its status as the world's largest creditor for the first time in 34 years: Germany overtook it
Japan has lost its status as the world's largest creditor for the first time in 34 years, losing ground to Germany, despite the country's total foreign assets rising to a record high, Japanese news agency Kyodo News reported.
Japan's gross foreign assets grew by 12.9% year-on-year to 533.05 trillion yen ($3.7 trillion) at the end of last year.
This figure exceeded 500 trillion yen ($3.49 trillion) for the first time, but the overall figure was lower than Germany's – 569.65 trillion yen ($3.98 trillion).
The Japanese Ministry of Finance explained that the growth in Japanese assets was partly due to the depreciation of the yen, which increased the value of foreign currency assets (stocks, bonds, etc.) when converted into the national currency.
Germany was able to overtake Japan thanks to a significant current account surplus.
Japan increased its net foreign assets for the seventh consecutive year in 2024. Total foreign assets rose 11.4%, driven by direct investment in the United States by domestic financial institutions and trading companies, to 1,659.02 trillion yen.
Japan's external liabilities also increased by 10.7% to 1,125.97 trillion yen. At the end of 2024, the US dollar to yen exchange rate was 157.89 yen (11.7% more than a year ago).
Japan now ranks second in the world in terms of net foreign assets. China ranks third with 516.28 trillion yen. The United States, on the other hand, has net foreign debts of 4,109.26 trillion yen – meaning its debts to foreigners significantly exceed its assets abroad.
- In April, leading German research institutes downgraded their forecast for the country's GDP growth this year to 0.1% from the 0.8% previously expected.
- On April 22, the German government worsened its forecast for the economy for 2025, expecting stagnation.
- On April 30, it became known that Germany avoided recession: the country's economy grew by 0.2% in the first quarter of 2025.
