Alwaght- The US Treasury Department report revealed on Monday that the Cayman Islands, a country of 57,000 people, owned $265 billion of US Treasuries as of March.
That makes the Cayman Islands that are a British Overseas Territory in the western Caribbean Sea the third largest foreign holder of the $19 trillion-plus of US debt, according to CNN.
The 264-square-kilometre Islands do not have a corporate tax, encouraging multinational companies to store vast sums of money there to avoid taxes.
The Treasury report came after Saudi Arabia threatened to sell off American assets if the US Congress passed a bill that would allow 9/11 victims to sue foreign governments.
Dumping a vast sum of US Treasuries at once could cause the securities to tank, potentially destabilizing global financial markets. It could also severely hurt Saudi Arabia's own finances, leading many experts to conclude the threat was empty.
Unlike with most other major owners of US debt, the Treasury Department kept Saudi Arabia's precise holdings secret since the 1970s. But that policy ended on Monday as the Treasury Department disclosed precise holdings by specific countries that were previously grouped together.
While the new report ranks Saudi Arabia as the 13th largest foreign holder of US debt saying it stockpiled $116.8 billion of US Treasuries as of March, the Arab monarchy's central bank listed owning $587 billion of foreign reserves as of March.
The top holder of US treasuries is American citizens and American entities, such as state and local governments, pension funds, mutual funds, and the Federal Reserve. Together they own the vast majority -- 67.5% -- of the debt.
Foreign nations hold 32.5% of the total. Outside the US, China is the largest foreign holder of the debt, with $1.25 trillion. It is followed closely by Japan, which holds $1.13 trillion.
