In January 2021, Japan owned $1.28 trillion in U.S. Treasuries, making it the largest foreign holder. The second-largest holder is China, which owns $1.10 trillion of U.S. debt. United Kingdom
The United Kingdom has increased its holdings in U.S. debt to an eight-year high in April 2020 to $368 billion.2 It has increased in rank as Brexit continues to weaken its economy. This is 6% of the total foreign debt.
Ireland
It would appear odd that Ireland is the fourth-largest holder of U.S. debt, particularly when comparing its economy to other European nations, such as Germany. However, a big factor in Ireland's place is the fact that many U.S. multinational companies, such as Alphabet/Google, set up shop there for more favorable taxes on foreign returns.
Dublin is a focal point for international fund management but also represents the European branches of U.S. technology and pharmaceutical companies. However, there has been a drop in Ireland's U.S. debt holdings, signaling a possible change in multinational attitudes as they move money back to the U.S. as rules on how foreign earnings are taxed change. Ireland holds $300 billion in U.S. debt, which is 4% of foreign debt.2
Luxembourg
Luxembourg is the fifth-largest holder of U.S. debt among foreign countries while having the 72nd smallest economy by GDP.3 Luxembourg holds $267.8 billion in U.S. Treasuries, equal to about 3.8% of total foreign holdings.
Poster Comment:
Some of these foreign holdings are actually fronts for the FED and the CIA.