Japan’s credit profile derives strength from its strong external position which gains on the back of Yen’s reserve currency status, persistent current account surplus, positive net international investment position (NIIP), and robust foreign exchange reserves. Additionally, strong assessment in terms of institutions and quality of governance support its overall credit profile. While Japan's large, diverse, and highly competitive economy are its key strengths in terms of economic structure, the country faces challenges from weak growth prospects and an ageing population. Furthermore, Japan’s credit profile faces challenges from its high gross general government debt.