Japan’s 2024 Current Account Surplus Tops 30 Trillion Yen as Exports and Investments Rise

The ministry also announced that Japan's current account surplus for the month of March this year amounted to 3.6781 trillion yen.

Japan’s current account surplus has long been a defining feature of its postwar economic structure, reflecting decades of export-led growth, high domestic savings, and outward investment. Since the 1980s, when Japan emerged as one of the world’s leading industrial powers, the country began consistently recording substantial current account surpluses. This trend was largely driven by robust exports of automobiles, electronics, and precision machinery, alongside limited reliance on foreign imports. The period also saw the yen appreciate significantly, particularly after the Plaza Accord in 1985, yet Japan’s competitiveness and surplus position remained intact, reinforcing its reputation as a trade powerhouse.

Through the 1990s and early 2000s, even as Japan’s economy entered a prolonged period of stagnation following the bursting of the asset price bubble, the current account remained in surplus. The composition of that surplus, however, gradually shifted. While trade surpluses began to narrow due to slower export growth and rising imports—especially of energy following the liberalization of the power sector—Japan’s investment income from abroad started to play a larger role. Japanese firms and institutional investors expanded their overseas holdings, generating significant returns in the form of dividends, interest, and earnings from foreign subsidiaries. This trend deepened in the aftermath of the 2011 Fukushima disaster, when Japan shut down most of its nuclear power plants and saw energy imports soar, pushing its trade balance into deficit. Even so, the income balance component of the current account remained strong enough to keep the overall account in surplus.

In recent years, Japan’s current account surplus has come to rely heavily on primary income from investments abroad, rather than exports alone. This shift reflects the country’s demographic challenges—such as a shrinking workforce and aging population—that have weakened domestic production and consumption growth. Japanese firms have increasingly offshored manufacturing, while pension funds and insurers have sought higher yields overseas. The result is a steady inflow of investment income that cushions the current account even when trade is under pressure. Japan’s persistent surplus has at times drawn criticism internationally, with some viewing it as a sign of global imbalances, but for Japan, it has functioned as a stabilizing force, supporting the yen and reinforcing the nation’s financial position.

The 30.3771 trillion yen surplus recorded in fiscal 2024 continues this long historical trend. It demonstrates Japan’s enduring capacity to generate income from global trade and investments, even amid volatile energy prices, geopolitical uncertainty, and shifting trade dynamics. The March 2025 figure of 3.6781 trillion yen further indicates that the surplus remains on solid footing in the early stages of the new fiscal year. Although the composition of the current account has evolved significantly over the decades, Japan’s ability to earn more from the world than it spends has remained a constant feature of its economic landscape.

Source: TBS