China Surpasses Japan to Become the World's Second-Largest Creditor

On May 26, data released by Japan's Ministry of Finance showed that in the 2025 global creditor ranking, Japan has been overtaken by China and dropped to third place worldwide. This marks another decline for Japan in the global standings, following its loss of the top position for the first time in 2025.

After Germany replaced Japan last year, ending its 34-year reign as the world’s largest creditor, China has now also surpassed Japan this year. According to statistics from Japan's Ministry of Finance based on International Monetary Fund data, Germany’s net foreign assets amounted to 67.55 trillion yen, securing the top spot globally; China’s net foreign assets totaled 63.63 trillion yen, ranking second; Japan fell to third place with total net foreign assets reaching 56.175 trillion yen.

According to data released by Japan's Ministry of Finance on May 26, as of the end of 2025, China, with approximately 63.63 trillion yen in net foreign assets, overtook Japan to become the world’s second-largest creditor. Germany maintained its lead with 67.55 trillion yen. In this reshuffling of rankings, although Japan’s net foreign assets rose by 4.4% year-on-year to a record-high 56.175 trillion yen, its external debt increased even more dramatically—by an astonishing 10.5%.

The rise of Germany and China is attributed to their sustained, substantial trade surpluses, which form a solid foundation for accumulating massive net foreign assets.

Japan’s decline stems from having recorded trade deficits for five consecutive fiscal years, directly limiting the pace of accumulation of its net foreign assets. As a result, Japan’s asset growth relies more on revaluation of overseas assets than on continuous new wealth creation.

This shift in rankings clearly illustrates evolving global economic dynamics: emerging manufacturing and export powerhouses are rising, while former economic giants face dual challenges of structural economic transformation and intensifying international competition.

Original source: toutiao.com/article/1866282227591180/

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