TOKYO: Japan’s Industry Ministry is seeking an unprecedented 7.8 trillion yen (US$49bil) to accelerate investment in semiconductors, artificial intelligence (AI) and other strategic industries at the heart of Prime Minister Sanae Takaichi’s agenda.
The Ministry of Economy, Trade and Industry (Meti) made the request yesterday for the fiscal year starting in April 2027, as Takaichi calls for 370 trillion yen in public and private investment across key industries over 14 years.
The unusually large request also reflects an overhaul of the budget process that allows ministries to submit proposals without a spending ceiling in a single round, as the government seeks to reduce its reliance on supplementary budgets.
Asked if the request was the biggest ever by Meti, Yuko Tamai, a ministry official who briefed on the budget proposal, said the ministry hadn’t examined historical requests to make that determination.
But she said the amount exceeds the combined 5.27 trillion yen allocated to Meti in the current fiscal year’s initial budget and last year’s supplementary budget.
Of the 7.8 trillion yen requested, 6.31 trillion yen is earmarked for investments under the “strong and prosperous Japan” category, reflecting Takaichi’s initiative for revitalising the economy.
The sum includes two trillion yen for AI, semiconductors and robots; 680 billion yen for securing critical minerals, including rare earths; 220 billion yen for strengthening naphtha supply capabilities; and 180 billion yen for enhancing defence and dual-use capabilities in cooperation with the Defence Ministry. — Bloomberg
