Which Countries Own the Most U.S. Debt?
Entity | Debt Holdings | Share of Total |
---|---|---|
U.S. Government and Federal Reserve | $8.1 trillion | 36.8% |
Foreign and international | $6.3 trillion | 28.5% |
Mutual funds | $2.06 trillion | 9.4% |
Pension funds | $0.92 trillion | 4.2% |
Banks | $0.77 trillion | 3.5% |
State and local governments | $0.69 trillion | 3.1% |
Other investors | $3.18 trillion | 14.5% |
Total | $21.97 trillion | 100.0% |
Internationally, the biggest owners of debt include China and Japan, each with over $1 trillion.
Rank | Country | U.S. Debt Holdings | Percentage of Foreign U.S. Debt Held (%) |
---|---|---|---|
#1 | □□ China | $1.11 trillion | 17.3% |
#2 | □□ Japan | $1.06 trillion | 16.5% |
#3 | □□ Brazil | $307 billion | 4.8% |
#4 | □□ United Kingdom | $301 billion | 4.7% |
#5 | □□ Ireland | $270 billion | 4.2% |
#6 | □□ Switzerland | $227 billion | 3.5% |
#7 | □□ Luxembourg | $224 billion | 3.5% |
#8 | □□ Cayman Islands | $217 billion | 3.4% |
#9 | □□ Hong Kong | $206 billion | 3.2% |
#10 | □□ Belgium | $180 billion | 2.8% |
#11 | □□ Saudi Arabia | $177 billion | 2.8% |
#12 | □□ Taiwan | $171 billion | 2.7% |
Why does China hold so much of the foreign-owned U.S. debt?
China has accumulated Treasury securities over decades, as part of its strategy to keep its domestic currency from strengthening. Interestingly, the export-heavy nation has reduced its swath of Treasury in recent months, selling off close to $200 billion of them.
Although China has $1.11 trillion of Treasury left in reserve, the general consensus is that dumping all of them at once would destabilize the global financial system, having an equally negative effect on China as well.
That said, with foreign nations holding U.S. debt, such a risk will always exist.