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Fact check: How does the national debt of Japan compare to Canada's in 2025?
Executive Summary
Japan’s headline national debt in 2025 is far larger in absolute terms than Canada’s and remains more than double Japan’s GDP, while Canada’s federal debt is much smaller in absolute terms but provincial debts push Canada’s general government debt-to-GDP into triple-digit territory in some estimates. The comparison hinges on whether one compares absolute amounts, debt-to-GDP ratios, or general government versus central/federal measures, and available 2025 sources point to Japan as the larger debtor by absolute size and by central-government debt relative to GDP [1] [2] [3].
1. Japan’s mounting headline numbers: a staggering absolute total that dominates headlines
Japan’s reported national debt reached record levels in 2024–2025, with figures cited around ¥1,317–1,323.7 trillion (roughly $8.7–$9.3 trillion USD), driven by rising defense spending and social-security obligations. These totals represent more than twice the size of Japan’s economy under the Finance Ministry’s accounting and are repeatedly described as record highs across multiple reports [2] [1]. Commentary from Japan’s political leadership has framed the fiscal situation as severe—evoking comparisons to Greece—which amplifies concern even while some articles note possible signs of debt stabilization [4] [5].
2. Canada’s mix: modest federal debt but big-picture liabilities at the provincial level
Canada’s federal debt in 2025 is reported around CAD 1.29 trillion, with a federal debt-to-GDP ratio near 42.7 percent; however, when one includes provincial debts the general government debt-to-GDP can rise into triple digits—one cited figure is 112.8 percent—meaning headlines about “Canada’s debt” depend heavily on measurement choices [3]. The Department of Finance’s projected record borrowing for FY2025–26 underscores Ottawa’s larger gross issuance plans but does not equate to Japan-scale absolute totals; Canada’s fiscal narratives focus on balancing federal supports and infrastructure spending while managing provincial liabilities [6].
3. Absolute-dollar comparison: Japan far larger than Canada in 2025
Measured in absolute currency terms, Japan’s government debt (about $8.7–$9.3 trillion USD) dwarfs Canada’s federal debt (about CAD 1.29 trillion, roughly $0.95 trillion USD depending on exchange rates). This absolute-dollar gap means Japan carries many times the nominal burden of Canada even before adjusting for GDP size or demographics [1] [3]. Multiple 2025 reports emphasize Japan’s record totals and size relative to its economy, while Canadian coverage emphasizes borrowing plans and provincial contributions rather than a comparable absolute national total [2] [6].
4. Debt-to-GDP: Japan’s central government vs Canada’s mixed picture
Japan’s central-government debt exceeds 200 percent of GDP in many official counts, a level rarely matched by large advanced economies, and is cited as “more than twice the size of Japan’s economy” in Finance Ministry data [2]. Canada’s federal debt-to-GDP is substantially lower—around the low- to mid-40 percent range—though the general government measure that includes provinces can push Canada’s ratio into much higher territory, complicating apples-to-apples comparisons [3]. Thus, by central-government debt-to-GDP Japan appears markedly more leveraged, whereas including subnational liabilities narrows the gap.
5. Measurement choices change the story: central vs general government, gross vs net
The divergent narratives across sources reflect different accounting lenses: Japan’s figures often cite national government or total debt outstanding; Canadian reporting alternates between federal-only and combined federal-plus-provincial measures. Some outlets emphasize gross issuance plans or headline totals, while analysts also look at net debt, pension liabilities, and contingent fiscal commitments. The disparate metrics mean that two reputable 2025 reports can both be “correct” while painting different pictures depending on whether the reader focuses on absolute totals, debt-to-GDP, or consolidated government liabilities [1] [3] [6].
6. Political framing and implied agendas: why language matters
Japanese political leaders and commentators framing Japan’s finances as “worse than Greece” use stark comparisons to press urgency for reforms, while other outlets note debt stabilization signs—each framing serves different policy narratives: urgency for austerity versus gradual reform [4] [5]. Canadian sources emphasize planned borrowing and investment, often to justify infrastructure and program spending; provincial inclusion in debt statistics can be used by critics to argue federal obscurity or by defenders to contextualize support needs [6] [3]. Readers should note these agendas when interpreting 2025 coverage.
7. Bottom line and what’s missing: fiscal context beyond headline numbers
The bottom line is that Japan’s debt is much larger in absolute terms and higher as a central-government share of GDP in 2025, while Canada’s federal debt is smaller though combined federal-plus-provincial liabilities can be substantial. What’s often missing from headlines are comparisons of interest-rate burdens, maturity structures, creditor composition, and demographic pressures that determine sustainability—factors highlighted unevenly across 2025 sources and critical to assessing long-term risk [1] [2] [3].