Japan's net foreign assets hit record high of $3 trillion in 2023, remains world's top creditor

Japan’s net foreign assets hit record high of $3 trillion (471.3 trillion yen) in 2023, according to official data cited by Reuters.

The increase in Japan’s net foreign assets in the year 2023 is the sixth such consecutive annual hike, as per the report.

The net foreign assets (NFA) refers to the value of the assets held by a nation abroad minus the assets in the nation owned by the foreigners. If the nation owns more assets abroad than what foreigners own in that nation, then the nation is a net creditor.

With the NFA figures of 2023, Japan has retained its spot as the world’s top creditor, as per the agency.

The report said that weak Japanese currency yen and overseas corporate acquisitions by Japanese companies, individuals, and government boosted the value of its foreign assets. The annual increases amounted to 51 trillion yen.

As per the data carried by the agency as of the 2023-end, Japan is followed by followed by Germany and China in terms of net creditors.

The Japanese government also released the revised current account balance data. In 2023, Japan had the current account surplus of 21.4 trillion yen. A country is said to have a current account surplus when exports of goods and services, foreign investments’ earnings, and incoming money transfers from abroad are higher than imports of goods and services, the outbound income to foreign investment in the country, and other outbound payments. A country having a current account surplus is rated highly in terms of economic status and international competitiveness.