Japan projects 370 trillion yen public-private drive to fiscal 2040
Prime Minister Sanae Takaichi pledges to end excessive austerity as Japan channels investment into AI, chips, shipbuilding, defence and biotech.
- The Japanese government projects a public-private investment drive exceeding 370 trillion yen by fiscal year 2040.
- The investment targets 17 strategic fields, including artificial intelligence, semiconductors, defence, and shipbuilding, to strengthen the economy.
- Key allocations include 68 trillion yen for semiconductors, 20.8 trillion yen for biotechnology and drugs, and 10.5 trillion yen for AI robotics.
- The government expects the initiative to help Japan's nominal GDP reach approximately 1,070 trillion yen and achieve real GDP growth of over 1.5%.
The Japanese government has projected that public-private investment in 17 strategic fields under Prime Minister Sanae Takaichi’s “responsible and proactive” fiscal policy will exceed 370 trillion yen by fiscal 2040.
The estimate was presented on Wednesday (June 24) at a joint meeting of the Council on Economic and Fiscal Policy and the Council for Japan’s Growth Strategy, both chaired by the prime minister.
The government expects the investment programme to encourage private-sector spending in artificial intelligence, semiconductors, shipbuilding, defence and other industries, helping Japan build a stronger economy.
Takaichi told the meeting that Japan was not falling behind other countries in technological innovation or labour productivity. “We'll eliminate excessive austerity and the lack of investments for the future, and make every effort to support efforts to acquire new market shares,” she stressed.
The government has identified 62 products and technologies across the 17 strategic fields as priority areas for investment. These include 10.5 trillion yen for the development of physical AI for moving robots and 68 trillion yen for the development and mass production of semiconductors needed to process large volumes of data at high speed.
Japan is aiming to secure more than 30 per cent of the global AI robot market by 2040 as it seeks to compete with the United States and China.
The scale and scope of strategic investment may expand further. Liquefied natural gas carriers, whose production in Japan has declined, were newly added to the list, with the government setting a target of building three to five such vessels from 2035 onwards.
In defence, 4.3 trillion yen is expected to be spent on research and development, as well as procurement, to make use of promising technologies from universities and private-sector companies for Japan’s defence needs.
Another 20.8 trillion yen will be allocated to developing drugs using biotechnology and expanding drug production capacity.
The government believes the impact of public-private investment could lift domestic private capital investment to more than 230 trillion yen in fiscal 2040, exceeding its annual target of 200 trillion yen. Japan’s nominal gross domestic product is projected to reach about 1,070 trillion yen, while real GDP growth is expected to exceed 1.5 per cent.
[Copyright The Jiji Press, Ltd.]
