Top 10 Countries the U.S. Owes Money To

By: Dave Roos & Melanie Radzicki McManus  | 
Coldstream Guards Band, Buckingham Palace
The Coldstream Guards Band plays during the Changing the Guard ceremony at Buckingham Palace in London. The U.K. is just one of the countries that owns a lot of U.S. debt. Pawel Libera/LightRocket via Getty Images

In 1989, New York real estate investor Seymour Durst spent $120,000 to erect a "National Debt Clock" in Times Square to track the exact amount of money that the U.S. federal government was borrowing to pay its bills. At the time, the country had run up a $2.7 trillion tab, but that figure seems almost quaint today. In 2008, the clock briefly ran out of available digits when the debt topped $10 trillion. By June 2021, the upgraded clock — which can now display up to a quadrillion dollars — registered more than $28 trillion [source: US Debt Clock].

Now, it's important to understand that U.S. doesn't owe that entire $28 trillion to its creditors, which include individuals, businesses and foreign governments who purchased U.S. Treasury bonds and securities. More than 20 percent of the national debt, or $6.2 trillion, is incurred for intragovernmental holdings, which are funds the U.S. government owes itself, mainly for the Social Security and Medicare trust funds [sources: Amadeo, U.S. Treasury]. In June 2021, these two trust funds alone accounted for some $2.4 trillion of the national debt.


But the question we want to answer today is, who owns the bulk of that $28 trillion in public debt? You can find out by perusing our global parade of America's biggest sugar daddies, according to the U.S. Department of the Treasury. (Note, the most recent figures released in June 2021 cover up to April 2021.)

10: Taiwan

Taiwan street signs
A jumble of street signs in a Taiwan street. Taiwan gets most of its income from trade and, as a hedge against the hard times, it invests in U.S. securities.
Ingram Publishing/Thinkstock

Creditor Name: Taiwan

Amount of U.S. Debt Owned: $234 billion


This small island nation makes nearly all of its money exporting goods to Europe, the U.S. and China. So when the world economy is good, the Taiwanese economy is very good [source: Shapiro]. But to hedge for the bad times, Taiwanese investors put their money in the safest securities in the world: U.S. debt.

Taiwan is a democracy with a constitution and a freely elected president. After World War II, the Communist party wrested control of the government from the Nationalist party and created the People's Republic of China (PRC). But many Nationalist leaders and sympathizers relocated to Taiwan, officially called the Republic of China [source: Bloomberg]. In essence, there were two Chinas. And the crazy thing is, there still are!

Both mainland China and Taiwan considered themselves the "one China," and the U.S. often finds itself in awkward diplomatic territory. On the one hand, America recognized PRC as the "real" China and severed diplomatic relations with Taiwan in 1979 [source: Maizland]. But on the other it sells Taiwan 100 percent of its arms, a $129 million transaction [source: Frohlich]. Money from Taiwanese investors also helped fuel the economic boom on the mainland [source: CIA World Fact Book].

Recently, the relationship between Taiwan and China has become increasingly tense, with China warning it will take back the renegade province by force, if necessary [ source: Maizland]. If a war between the two ensues, no one knows how the U.S. would respond.

9: Belgium

flower carpet, grande palace, belgium
The flower carpet at the Grande-Place, Belgium. Despite its small size, Belgium's reputation as an international banking center means lots of financial transactions reside here.

Creditor Name: Belgium

Amount of U.S. Debt Owned: $234.8 billion


We know what you're thinking: Belgium? Really? The gross domestic product (GDP) of this small European nation tucked between France, Germany and the Netherlands ranks No. 25 in the world, behind Poland and Iran [source: Statistics Times]. So why is Belgium one of the top 10 purchasers of U.S. debt?

Belgium has made a name for itself as one of Europe's most vibrant international banking centers. Bank accounts here historically offered a high degree of secrecy, although that changed in 2011, when the Belgian government began disclosing account information to improve tax transparency [source: Hyslop].

In addition, there's something called "custodial bias" at work. Belgium's status as a tax haven makes it a popular place to buy U.S. debt. And investors do just that, whether they live in nearby France and Germany, or far-flung locales such as China and Japan. But the U.S. Treasury tracks purchases of U.S. debt by geographic origin, not the specific nationality of the buyer [source: U.S. Treasury]. Thus, how much of the debt ascribed to Belgium is actually owned by Belgians is difficult to discern.

8: Brazil

sao paulo
A glimpse of the Sao Paulo city center. Brazil is the world's ninth largest economy.

Creditor Name: Brazil

Amount of U.S. Debt Owned: $255.3 billion


According to the World Bank, Brazil is the world's ninth-largest economy. Its explosive economic growth, starting around 2010, was fueled by aggressive investment by the Chinese. That year, China signed lucrative trade agreements with Brazil to buy massive amounts of raw materials like iron ore and crude oil [source: Pomfret]. In addition to exporting natural resources, Chinese firms have built huge factories, farms and manufacturing plants on Brazilian soil.

But after recording an impressive growth rate of 7.5 percent in 2010 — while the rest of world was still emerging from the recession — the Brazilian economy has put on the brakes. Its growth rate in 2015 was negative 3.6 percent; by 2019, that had risen to just 1.1 percent, due in part to China's own cooling economy [source: Macrotrends].

7: Switzerland

Despite its small physical size, Switzerland manages more financial assets than any other country.

Creditor Name: Switzerland

Amount of U.S. Debt Owned: $261 billion


Switzerland is a small but incredibly wealthy European nation long famous as an offshore tax haven for wealthy investors. In 2019, Swiss banks held $2.7 trillion in assets, compared to $24 trillion in the U.S. That comes out to $337,500 per capita in Switzerland, but a paltry $75,949 per capita in the U.S. [sources: Statista, Statista]. The Swiss enjoy high employment, longer-than-average life expectancy and rank among the happiest nations in the world [source: OECD]. The Swiss — or at least Swiss banks — are also one of the most reliable buyers of U.S. debt, routinely among the major investors in U.S. Treasury securities.

The country's tax-haven moniker isn't quite so accurate anymore, either. After much pressure from the U.S. and the European Union, Switzerland's once-strict banking privacy laws have been diminished, lessening its ability to hide money [source: Goetz].

6: Luxembourg

Tiny, picturesque Luxembourg is also a big buyer of U.S. debt, but custodial bias probably distorts this ranking.

Creditor Name: Luxembourg

Amount of U.S. Debt Owned: $291 billion


A nation of bankers, itsy-bitsy Luxembourg has the fourth-highest gross domestic product (GDP) per capita in the world — $114,685 in 2019 — and has no reservations about investing in other nations' cheap debt. Yet Luxembourg's own economic stability is up for debate. While it owns $291 billion of U.S. debt, the tiny country owes more than $4 trillion to its own foreign creditors. That ranks tiny Luxembourg No. 7 on the global list of total foreign indebtedness [sources: The World Bank, The World Bank].

Like its neighbor, Belgium, Luxembourg is a tax haven for wealthy foreign investors. Also like Belgium, investors from around the world buy U.S. debt through accounts based in Luxembourg. Since the U.S. Treasury doesn't distinguish between debt bought by bona fide Luxembourgians and debt bought by foreigners, Luxembourg's debt ownership figures may be artificially inflated.

5: Ireland

Ireland, pub
People enjoy afternoon drinks outside a pub in the center of Dublin, Ireland.
Artur Widak/NurPhoto via Getty Images

Creditor Name: Ireland

Amount of U.S. Debt Owned: $307 billion


Ireland doesn't spring to mind when you ponder which countries own a lot of U.S. debt. After all, the small island country is better known as the home of leprechauns and Guinness beer. But it's also home to many U.S. multinational companies like Alphabet/Google, which settle there due to the country's low corporate tax rates and other mechanisms that allowed companies based in Ireland to reallocate profits to tax havens like Bermuda and pay zero corporate tax. However, change is afoot.

After watching companies such as Google shift billions of dollars of profit to tax havens, the G7 announced a minimum global corporate tax of 15 percent in June 2021, something Ireland has vigorously protested. Other countries, too, are changing their rules regarding the taxation of foreign earnings. How this all plays out on the global stage remains to be seen [sources: Sebastian, Subramanian].

4: United Kingdom

yellow flowers, buckingham palace
Yellow flowers line Buckingham Palace on April 17, 2021, in London.
Stuart C. Wilson/Getty Images

Creditor Name: United Kingdom

Amount of U.S. Debt Owned: $431.8 billion


The United Kingdom (U.K.) is on a roll when it comes to owning U.S. debt. In 2021, its holdings topped $443 billion, a nine-year high [source: Sebastian]. What happens next is anyone's guess. The U.K. is the world's sixth biggest economy, with a $2.8 trillion GDP in 2019, powered by a strong service sector (finance, insurance and business services). Yet at the start of 2020, the U.K. officially separated from the European Union (EU) in a move nicknamed Brexit.

Brexit means the U.K. is no longer part of the EU's free trade agreement. Partly due to this, many businesses subsequently moved their headquarters out of Britain and into EU countries. In addition, Scotland, which voted against Brexit, is contemplating separating from the U.K. and joining the EU as an independent country. While the U.K. and EU did reach a trade agreement in 2021, its economic future is still uncertain, which has caused a countrywide economic slowdown [source: Amadeo].

3: China

A Shanghai skyline at dusk. China is the U.S.'s second-largest foreign creditor, owing more than $1 trillion of U.S. debt.

Creditor Name: China

Amount of U.S. Debt Owned: $1.1 trillion


With 1.4 billion people, the world's second-largest economy and rapid economic growth, China is an undisputed economic powerhouse [source: World Bank]. China is also the foreign country that owns the second-most U.S. debt, breaking the trillion-dollar mark in 2011 and never looking back. The question is: Is it bad for the U.S. economy or national security that one of America's biggest rivals owns more than 4 percent of its debt [source: Investopedia]?

You might compare it to the arms race between the former Soviet Union and the United States during the Cold War. Sure, either side could have launched its warheads and inflicted terrible damage on the enemy, but an act of aggression would have ensured an equally punishing retaliation.

If China wanted to economically injure the U.S. by selling off its debt securities, the result could be dramatically higher interest rates and a steep devaluation of the dollar. But the Chinese would also shoot themselves in the foot. The Chinese have close to half of their cash reserves invested in U.S. debt [source: Davidson]. For China, it's the safest, best investment the growing nation can make. China's economic growth is fueled partly by the return on their U.S. investment. Poisoning the dollar would take the yuan right down with it [source: Capaccio].

2: Japan

japanese girl
A Japanese girl smiles in a Tokyo city street. Japan is America's largest foreign creditor.
Ryan McVay/Lifesize/Thinkstock

Creditor Name: Japan

Amount of U.S. Debt Owned: $1.2 trillion


We've been talking a lot about America's debt problem, but how does U.S. indebtedness compare to other industrialized nations? The most useful debt measurement is to calculate the ratio of public debt to gross domestic product (GDP). At the end of 2020, U.S. public debt totaled 107.6 percent of the GDP, meaning the U.S. borrowed more than what it earned that year. And while 2020 was the year the COVID-19 pandemic ruined economies around the globe, that figure wasn't a huge anomaly, as it was 106.9 percent in 2019 [source: Trading Economics].

Although a 107.6 percent debt-to-GDP ratio isn't ideal, it's a heck of a lot better than the situation in Japan, where public debt represented a mind-blowing 236 percent of GDP in 2017 [source: Commodity]. How can the Japanese economy support such a lopsided debt-to-earnings ratio?

It turns out that Japan's debt, while incredibly high, is not unsustainable. The Japanese economy is still very strong. It boasts the world's third-largest GDP, and unemployment was a mere 2.6 percent in March 2021. The country is also heavily invested in U.S. debt securities, some of the most financially sound investments in the world.

But the biggest difference between Japanese and American debt is that Japanese citizens own 90 percent of their country's debt, with only 10 percent in the hands of foreigners. In contrast, more than 40 percent of U.S. debt is owned by foreign investors, a far riskier proposition [source: Oh].

1: United States of America

4th of July fireworks, jefferson memorial
Fireworks fly over the Jefferson Memorial on the Fourth of July. Wonder what the Founding Fathers would have made of the vast U.S. public debt today>

Creditor Name: American Public and State and Local Governments

Amount of U.S. Debt Owned: $6.2 trillion

Surprise! The country the United States is most indebted to is ... itself. As of December 2020, here are some of the domestic investors who owned U.S. Treasury Securities [source: U.S. Department of the Treasury]:

  • Mutual funds: $3.5 trillion
  • Depository institutions (commercial banks, credit unions): $1.2 trillion
  • State and local governments: $342.8 billion
  • Private pension funds: $804.7 billion
  • Insurance companies: $252.2 billion
  • State and local government pension funds: $342.8 billion
  • U.S. savings bonds: $141.1 billion

Why would individual Americans, businesses and local governments continue to loan money to the United States? Doesn't it seem risky to put money into an institution that's already $28 trillion in the hole? Believe it or not, investing in the government isn't a high-risk proposition. While the federal government is hemorrhaging thousands of dollars by the second in order to pay interest on its debts, the U.S. has a vested interested in not defaulting on its loans. America's credit rating would drop, and the booming market for U.S. debt could dry up. How would the U.S. government function without its international credit card? Let's hope we never find out.

U.S. Dept FAQs

How much is the U.S. in debt to China?
The United States currently owes China around $1.1 trillion as of 2021. China broke the trillion-dollar mark back in 2011 according to the U.S. Treasury report. However, China does not disclose how much debt the U.S. owes them.
How much debt is the U.S. in 2021?
As of 2021, U.S. debt had surpassed $28 trillion.
Who does the United States owe the most debt to?
As of July 2020, Japan overtook China and became the largest foreign debt collector for the U.S. The United States currently owes Japan about $1.2 trillion according to the U.S. Treasury report.
What countries does the U.S. owe money to in 2021?
The United States owes money to many countries, including Japan, mainland China, the U.K., Ireland, Luxembourg, Brazil, Switzerland and Belgium, among others.

Lots More Information

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