JAPANESE ECONOMIC AND BUSINESS WEEKLY NEWSLETTER: 18 May -22 May,2026
The EU Japan Centre is releasing a weekly press review covering Japan's economic and business matters.
Weekly Japanese Economic and Business News (18 May - 22 May, 2026)
Outline
1. Economic News
▶ The first Japan-Brazil Foreign Ministers’ Strategic Dialogue
18 May, 2026
Photo Source: MOFA
Japan and Brazil held their first Foreign Ministers’ Strategic Dialogue between Foreign Minister Takeshi Motegi and Foreign Minister Mauro Vieira in Tokyo, agreeing to deepen their Strategic and Global Partnership. They signed agreements on cooperation for nationals abroad and technical projects in health, forest conservation, and land restoration, while also discussing expanded economic ties, including critical minerals, energy, and food security. The two sides also exchanged views on regional and global issues and reaffirmed cooperation on UN Security Council reform through the G4 framework.
MOFA:https://www.mofa.go.jp/press/release/pressite_000001_02349.html
▶ Japan to support growth of dual-use tech startups with early payments
19 May, 2026
Nikkei Illustration
Japan plans to support startups developing dual-use technologies such as AI, drones, and space tech by allowing advance payments and easing procurement rules for government contracts. The goal is to strengthen both innovation and national defense capabilities. New measures may include upfront payments, provisional payments, and waived security deposits to improve startup cash flow.
The government also plans to create secure R&D hubs and expand support in 17 strategic sectors. Japan hopes these reforms will help more startups scale globally, attract overseas investment, and increase the number of unicorn companies. U.S. VC firm Andreessen Horowitz is also expanding into Tokyo to support collaboration with Japanese startups and the Defense Ministry.
▶ Japan to strengthen cyber defense for critical infrastructure
19 May, 2026
Photo Source: JIJI
Japan’s government has adopted new measures to strengthen cybersecurity for critical infrastructure sectors including telecommunications, finance, and healthcare amid growing AI-related cyber risks.
The package includes enhanced cyber defense information sharing, expert development, cooperation with foreign governments and AI companies, and stronger responses to software vulnerabilities. The move follows concerns that advanced AI tools such as Anthropic’s Claude Mythos could be misused to target key infrastructure.
Japan times:https://www.japantimes.co.jp/news/2026/05/19/japan/cyber-defense-measures/
▶ Japan and South Korea build on thaw through deeper energy ties
19 May, 2026
Photo Source: Yomiuri
Sanae Takaichi and Lee Jae Myung met in South Korea to strengthen ties between their countries amid growing global tensions. The leaders emphasized the importance of Japan–South Korea cooperation for regional stability and discussed security concerns, energy supply risks, and closer defense coordination. The cooperation will focus on bolstering regional energy stockpiles and expanding reciprocal arrangements for crude oil, petroleum products and liquefied natural gas, including swap deals, as both countries look to shore up supply security.
▶ Japan to urge startups to explore buyouts instead of IPOs
20 May, 2026
Nikkei Illustration
Japan’s Ministry of Economy, Trade and Industry plans new guidelines encouraging startups to consider M&A (being acquired) as an alternative to IPOs. The policy aims to strengthen Japan’s startup ecosystem, where most companies currently prefer IPOs over acquisitions. The guidelines will recommend easier acquisition structures, such as reducing shareholder veto power and planning business strategies that allow early-stage buyouts. The move also aligns with changes at the Tokyo Stock Exchange, which is tightening listing rules and may push weaker-growth startups toward being acquired rather than going public.
Nikkei Asia:https://asia.nikkei.com/business/startups/japan-to-urge-startups-to-explore-buyouts-instead-of-ipos
▶ Japan's DBJ eyes longer investment horizon to support reshoring
20 May, 2026
Photo Source: Kazuho Fujiwara/Nikkei
Development Bank of Japan plans to invest 3 trillion yen ($18.9 billion) in risk capital over the next five years to support Japanese businesses. The funding will focus on areas such as supply chain restructuring, industry consolidation, infrastructure, and advanced technology projects. DBJ President Seiji Jige said the bank is prepared to hold investments for 10 years or longer instead of the usual five, reflecting the need for long-term support amid geopolitical and economic uncertainty. The bank also aims to play a larger role in mergers and acquisitions and in supporting midsize companies seeking growth capital.
Nikkei Asia: https://asia.nikkei.com/business/finance/japan-s-dbj-eyes-longer-investment-horizon-to-support-reshoring
▶ Japan to unleash green bonds on EV batteries, other new fields
21 May, 2026
Photo Source: Toshiki Sasazu/Nikkei
Japan plans to expand the types of projects eligible for green bond financing to include EV batteries, battery materials, hydrogen gas turbines, and other technologies that reduce emissions across supply chains. The Environment Ministry is expected to revise its green bond guidelines as early as June in line with updated international standards. The move comes as rising interest rates, inflation, and higher renewable energy costs have slowed green bond issuance in Japan. Officials hope the broader rules will encourage more investment in sustainability projects, especially as electricity demand grows due to AI and data centers. Discussions are also continuing over whether nuclear power investments should qualify as green finance.
Nikkei Asia:https://asia.nikkei.com/business/finance/japan-to-unleash-green-bonds-on-ev-batteries-other-new-fields
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2. Business News
▶ Daiwa to invest $630m in Japan battery storage for chip, data center power
19 May, 2026
Photo Source: Shinya Sawai/Nikkei
Daiwa Securities Group plans to invest 100 billion yen by 2030 in battery storage facilities to meet rising electricity demand driven by semiconductors, data centers, and renewable energy expansion. Its first major project will be a 10 billion yen energy storage facility in Chitose, Hokkaido, expected to begin operations around 2027. The facility will store 160 megawatt-hours of electricity — enough for about 15,000 households daily — and aims to profit by storing cheaper daytime power and supplying it at higher nighttime rates. The project will be managed by Daiwa’s energy infrastructure unit, with financing support from Aozora Bank. The move marks Daiwa’s first major direct investment in battery storage, as Japan’s energy storage market is projected to grow significantly by 2030.
▶ Sweden's Saab seeks a bigger role in Japan's defense buildup
20 May, 2026
Nikkei montage/Source photos by SAAB website
Saab AB is expanding its defense business in Japan as the country strengthens its military industry and opens up to international cooperation. The Swedish company aims to take part in major Japanese defense projects, including the Mogami-class frigate export program led by Mitsubishi Heavy Industries, as well as potential deals on trainer aircraft and unmanned surveillance systems. It is positioning itself as a systems-integrator partner that can link Japanese and allied technologies. The move reflects Japan’s policy shift toward boosting defense exports and working with foreign partners, while Saab hopes to jointly develop and export advanced systems to markets like Australia and New Zealand.
▶ Japan reactor makers project record sales in nuclear power resurgence
21 May, 2026
Photo Source:Akitoshi Sugiura/Nikkei
Japanese nuclear-related companies are seeing strong growth as global demand for nuclear energy rebounds. The combined sales of major firms like Mitsubishi Heavy Industries, Hitachi, and IHI Corporation are projected to rise 14% to a nine-year high, driven mainly by reactor restarts in Japan, safety upgrade work, and expanding overseas opportunities. Growth is also supported by large expected U.S. investments and a policy shift in Europe toward reconsidering nuclear power, including small modular reactors. In Japan, restarted plants and fuel-cycle projects are generating steady engineering and construction demand even without new reactor builds. Overall, nuclear power is regaining momentum globally, with companies preparing for long-term expansion as electricity demand rises from AI and energy transition needs.
▶ Fujitsu supports the Panasonic Group in accelerating its sustainability management through the implementation of a CFP calculation solution
21 May, 2026
Source: Fujitsu
Fujitsu Limited has begun building a product carbon footprint (CFP) calculation platform for Panasonic Holdings Corporation. The system will standardize and streamline the calculation of CO₂ emissions across Panasonic’s supply chain and support environmental reporting and regulatory compliance. The platform enables integrated data management, improved traceability, and automated reporting based on international standards. Full-scale operation is planned for April 2027, and it is intended to strengthen decarbonization efforts and sustainability management across the Panasonic Group.
Fujitsu: https://global.fujitsu/en-global/pr/news/2026/05/21-01
▶ Asahi Kasei Develops Novel Photosensitive Polyimide Film for Advanced Panel-Level Semiconductor Packaging
21 May, 2026
Photo Source: Asahi Kasei
Asahi Kasei Corporation has developed a new photosensitive film combining PSPI and dry film photoresist to improve efficiency in advanced semiconductor packaging. The material is designed for panel-level packaging, enabling finer circuits, more insulating layers, and higher manufacturing productivity. It is currently under customer evaluation, with commercial launch expected soon amid rising demand from AI-related chips and high-performance computing.
Asahi Kasei: https://www.asahi-kasei.com/news/2026/e260521
▶ INPEX Awarded Exploration Rights Offshore Eastern Java, Indonesia
21 May, 2026
Source: INPEX
INPEX Corporation has been awarded exploration rights for the Barong offshore block in East Java, Indonesia, together with partners, under a new Production Sharing Contract. The project focuses on exploring potential oil and gas resources in a region with existing energy production and stable long-term demand. If successful, it could move quickly to development and production. This project supports INPEX’s strategy to expand its natural gas and LNG business in Southeast Asia as part of its long-term growth plan.
INPEX: https://www.inpex.com/english/news/upload/20260521.pdf
▶ Kawasaki Heavy to partner with Nvidia on physical AI, open US robot center
22 May, 2026
Photo Source: Nikkei
Kawasaki Heavy Industries is partnering with Nvidia to develop advanced robotics powered by physical AI, with a new joint development center opening in San Jose. The collaboration will initially focus on medical and mobility applications, including hospital support robots and Kawasaki’s four-legged personal mobility robot, Corleo. By integrating Nvidia’s AI and simulation technologies, the companies aim to improve autonomous movement, environmental recognition, and task performance. Kawasaki Heavy also plans to collaborate with Analog Devices, Microsoft, and Fujitsu at the new center as it expands its global AI robotics strategy across the U.S., Japan, and France.
Published: May 2026
EU-Japan Centre for Industrial Cooperation
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