China Surpasses Japan to Become Asia's Largest Creditor

China has been named Asia’s largest creditor, surpassing Japan in 2025. Beijing holds net external assets of 636.3 trillion yen (approximately £3.8 trillion or Rp71.1 quadrillion), while Japan has 561.75 trillion yen (Rp62.7 quadrillion), marking Tokyo’s first displacement from Asia’s top creditor position. In 2024, Germany overtook Japan as the world’s largest creditor. ‘After losing the top spot to Germany for the first time in 34 years the previous year, Japan has now ceded its position as the world’s second-largest creditor to China and dropped to third place globally,’ Reuters reported. Slowing growth in net external assets contributed to Japan’s decline, with non-resident holdings of Japanese securities worth 62.2 trillion yen (Rp6.9 quadrillion) reducing the country’s net external assets. They have started shifting their debtor targets from developing countries and the United States to become the largest loan recipient country currently. Specifically, for developing nations, China provides funding through its Belt and Road Initiative (BRI), a trade route connecting Fuzhou to Rotterdam via land and sea. There are indications that China’s loan expansion continues to target major Western companies.