Photo/Illutration The Finance Ministry in Tokyo's Chiyoda Ward (Asahi Shimbun file photo)

Although Japan's net foreign assets (NFA) balance logged a record high for a sixth consecutive year, it relinquished its status as the world's top holder of such assets to Germany after a period of 33 years.

NFAs represent the financial value of what the government, corporations and individuals hold abroad, minus their liabilities. Japan's reached 533.05 trillion yen ($3.72 trillion) in 2024, the Finance Ministry reported on May 27.

Factors such as the weak yen and increased overseas investments ultimately contributed to the approximately 61 trillion yen rise in Japan's NFAs compared to the previous year. 

The significant growth of Germany's NFAs, meanwhile, enabled it to reclaim the spot as the world's top creditor for the first time since 1990. A substantial trade surplus and accumulation of assets overseas gained the country a total of 569.65 trillion yen after gradually closing the gap with Japan. 

Germany saw its NFAs expand by about 115 trillion yen in 2024 over the prior year to surpass Japan. China ranked third with 516.28 trillion yen and is closing in with an increase of roughly 103.5 trillion yen from the year before.

The title served Japan as a key indicator of the yen being a safe bet in times of financial turbulence. At a news conference following the May 27 Cabinet meeting, Finance Minister Katsunobu Kato sought to reinforce this image.

"Considering that Japan's net foreign assets are steadily increasing, it (the loss of the top spot) should not be viewed as a significant change in Japan's position based solely on the ranking," he said.

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