Germany Overtakes Japan as World’s Top Creditor in 2025

• Germany becomes the world’s largest net creditor, surpassing Japan

• Japan’s net external assets fell significantly in 2024

• Germany’s surplus is driven by strong exports, stable currency, and capital investments

• Shift highlights the evolving structure of global economic leadership

• Experts see this as a sign of Asia-to-Europe economic rebalancing

Net external assets are the difference between a country’s foreign assets and its liabilities. In simpler terms, it shows how much a country owns overseas versus how much it owes to the world.

This metric indicates a country’s financial strength and influence in global markets.

• Japan held this position for 34 consecutive years

• Germany’s recent rise is seen as symbolic and strategic

Japan’s Ministry of Finance confirmed that by the end of 2024, the country's net external assets had decreased by ¥24.5 trillion (approximately $156 billion) compared to the previous year.

Key factors behind Japan’s decline:

• The Japanese yen depreciated significantly in 2024

• This lowered the value of Japan’s foreign investments when converted back to yen

• Japanese investors diversified into riskier, higher-yielding markets

• This reduced Japan’s low-risk, high-reserve holdings abroad

• Japan’s increasing foreign debt and overseas obligations trimmed down the net figure

Germany’s current account surplus and export-driven economy fueled its rise as the top global creditor.

Major contributors:

• Germany continues to be a global export powerhouse

• Particularly strong in automobiles, machinery, and chemicals

• The euro held steady against the dollar and other currencies

• This kept the value of German investments abroad stable

• Germany is known for its budgetary conservatism

• Low public debt and responsible spending helped build net assets

“While Japan still maintains a strong economic profile, the yen’s depreciation and foreign liabilities have impacted our net asset position in 2024.”

“Germany’s global investment footprint reflects the resilience of our economy. This shift is not only symbolic but also strategic for Europe’s future.”

The financial world responded with a mix of surprise and curiosity:

• Economists see this as a reflection of Japan’s long-term stagnation and Germany’s continued trade dominance

• Investors are reassessing their portfolios, considering stronger positions in German and EU-based assets

• Media analysts label this a “symbolic power shift” in post-COVID global economics

Japan’s decline in net external assets may not be temporary. Some experts believe it signals:

• An aging population is shrinking domestic productivity

• Monetary easing policies affecting long-term asset value

• A shift in investment behavior from safe to speculative markets

Meanwhile, Germany's rise could signal:

• A greater European role in global finance

• More Eurozone stability, attracting long-term investments

• Stronger global political leverage in economic matters

This transition is more than a title swap — it’s a rebalancing of global economic influence.

• Pressure to strengthen the yen

• Need for economic reforms and domestic investment

• Calls to reduce reliance on traditional saving models

• Opportunity to lead in financial diplomacy

• Increased responsibility in EU economic leadership

• Stronger bargaining power in global forums like the G7 and the IMF

“This is not just about numbers. It’s a wake-up call for Japan to re-think its global financial strategy.”

“Germany’s rise is built on consistency, not speculation. But the country must remain cautious of geopolitical risks.”

• Germany is now the largest foreign investor in Eastern Europe and Sub-Saharan Africa.

• Japan holds nearly $1 trillion in U.S. Treasury bonds, one of the highest globally.

• The Japanese yen lost over 12% of its value against the dollar in 2024.

This change marks a turning point in global economics. While Japan’s legacy as a global creditor is unmatched, the current numbers reveal that Germany has quietly climbed to the top.

Whether this reshuffling continues depends on:

• Currency trends

• Policy decisions

• Global trade stability

• Geopolitical risks

But one thing is clear: the world is watching as the financial center of gravity shifts — not from East to West, but from Asia to the heart of Europe.