The phrase “countries in debt to the US” is one of the most commonly misunderstood topics in international finance. In reality, the United States is the world’s largest debtor nation, not a creditor. Foreign governments hold trillions of dollars in U.S. Treasury securities, which means the U.S. owes them money, not the other way around. When you see headlines about Japan or China and U.S. debt, those countries are lending to the United States by purchasing its bonds.
Why the Confusion Exists
U.S. Treasury securities are essentially IOUs issued by the federal government. When a country like Japan buys $1 billion in Treasury bonds, it is lending the U.S. $1 billion. The U.S. promises to pay that money back with interest. So the relationship runs opposite to what many people assume: foreign countries are America’s creditors, not its debtors.
As of February 2026, foreign governments and investors held enormous amounts of these securities. The total value of foreign-held U.S. securities, including stocks and bonds, reached $35.3 trillion as of mid-2025, according to the U.S. Treasury Department. Of that, trillions were in Treasury bonds and notes, which represent direct loans to the U.S. government.
Countries the U.S. Owes the Most
The Treasury Department publishes monthly data on which countries hold the largest amounts of U.S. government debt. As of February 2026, the top foreign holders of U.S. Treasury securities were:
- Japan: $1,239.3 billion
- United Kingdom: $897.3 billion
- China (Mainland): $693.3 billion
- Belgium: $454.7 billion
- Canada: $446.3 billion
Japan has been the largest foreign holder of U.S. debt for several years, surpassing China, which has gradually reduced its holdings. China once held well over $1 trillion in Treasuries but has steadily sold off portions of its position.
Belgium’s high ranking may look surprising for a relatively small country. That’s largely because Brussels hosts Euroclear, a major international securities clearinghouse. Treasury securities held through Euroclear on behalf of investors in other countries get attributed to Belgium in the data, even though the actual owners may be spread across the globe. The Treasury Department itself notes that securities held in overseas custody accounts may not reflect the true country of ownership.
Does Any Country Owe the U.S. Money?
Some countries do carry bilateral debt obligations to the United States, but these are far smaller and less publicized than the Treasury holdings data. The U.S. government has historically extended loans and credit to foreign nations through several channels:
- Foreign military financing and loans: The U.S. has provided military-related credit to allied nations, though most modern military aid takes the form of grants rather than loans.
- Development lending: Agencies like the Export-Import Bank of the United States extend credit to foreign buyers of American goods. These create debt obligations from foreign entities to the U.S.
- Post-war and emergency lending: After World War II, the U.S. made large loans to European nations under various reconstruction programs. Most of those debts were repaid decades ago, restructured, or forgiven.
These obligations are modest compared to the trillions that the U.S. itself owes foreign holders. There is no publicly maintained ranking of “countries indebted to the U.S.” in the same way the Treasury tracks foreign holders of American debt, because the amounts are relatively small and spread across different agencies and programs.
Why Countries Buy U.S. Debt
Foreign governments buy Treasury securities for practical reasons, not as a favor. U.S. Treasuries are considered one of the safest investments in the world because the U.S. has never defaulted on its debt. Countries with large trade surpluses, particularly those that export heavily to the U.S., accumulate dollars and need somewhere safe to park them. Buying Treasuries earns interest while keeping those reserves liquid, meaning they can be sold quickly if needed.
Central banks also hold Treasuries as part of their foreign exchange reserves. Holding U.S. debt helps stabilize their own currencies and gives them a cushion during economic downturns. For countries like Japan and China, which run large trade surpluses with the U.S., buying Treasuries is a natural byproduct of the trade relationship.
What This Means in Practice
The U.S. national debt is financed by a mix of domestic and foreign buyers. Foreign holdings represent a significant share, but most U.S. debt is actually held domestically by American investors, mutual funds, pension funds, and the Federal Reserve. Foreign governments collectively hold roughly a quarter of the total outstanding public debt.
This arrangement gives foreign creditors some financial leverage, at least in theory. If a major holder like Japan rapidly sold its Treasury holdings, it could push bond prices down and interest rates up. In practice, large-scale selling would also hurt the seller by driving down the value of their remaining holdings and disrupting global markets. This mutual dependency is sometimes described as a financial balance of power.
For the average American, the key takeaway is straightforward: the U.S. is a net borrower on the world stage. The countries most commonly associated with “U.S. debt” are not nations that owe America money. They are nations that have lent America money by purchasing its bonds, and the U.S. pays them interest for the privilege.