The EU Business Hub @ Smart Energy Week Autumn 2025 Business Mission, taking place from September…
Weekly Japanese Industry and Policy News: 03 - 09 May, 2025
The EU Japan Centre is releasing a weekly press review covering Japan's economic and policy matters.
Economic News
▶ Japan-France Foreign Ministers’ Luncheon Meeting
02 May, 2025
On May 2nd in France (7:45 p.m. JST), Japanese Foreign Minister Takeshi Iwaya met with French Foreign Minister Jean-Noël Barrot to strengthen Japan-France ties, especially in security and economic areas. They affirmed cooperation in the Indo-Pacific, rare earth supply chains, and global challenges such as Ukraine, North Korea, and the Middle East. They also discussed economic issues like U.S. tariffs and global trade. The ministers agreed to work toward upcoming cultural anniversaries and continue close collaboration bilaterally and within the G7, which France will chair in 2026.
MOFA: https://www.mofa.go.jp/erp/we/fr/pageite_000001_00956.html
▶ Japan to cooperate with Singapore on undersea cables, cybersecurity
04 May, 2025
Japan plans to enhance cooperation with Singapore on undersea cables and cybersecurity to strengthen secure communications infrastructure in the Indo-Pacific, amid growing concerns over China’s influence. The initiative, led by Japan’s Ministry of Internal Affairs, may include renewing a 2021 agreement and supporting ASEAN cable management guidelines. Japan aims to promote trusted providers like NEC, U.S., and European firms. Both countries also plan to collaborate on next-generation infrastructure like NTT’s IOWN platform. As regional digital leaders, Japan and Singapore view secure infrastructure as key to countering potential risks from Chinese-backed projects.
▶ Japan's child population falls for 44th straight year
04 May, 2025
As of April 1, Japan’s population of children under 15 fell by 350,000 to 13.66 million, the lowest since 1950 and marking the 44th consecutive annual decline. Children now make up just 11.1% of Japan’s total population, the second-lowest among major countries, after South Korea. All 47 prefectures saw a drop in child population, with Tokyo and Kanagawa the only ones with over 1 million children. Okinawa had the highest child proportion at 15.8%, while Akita had the lowest at 8.8%.
Japan times: https://www.japantimes.co.jp/news/2025/05/04/japan/society/japan-child-population-falls-for-44th-straight-year/
▶ Panel weighs need to update 43 tril. yen Japan defense buildup plan
05 May, 2025
A panel under Japan's Defense Ministry is reviewing the current five-year, 43 trillion yen ($297 billion) defense buildup plan due to rising equipment costs from inflation and a weak yen. The panel, led by former business leader Sadayuki Sakakibara, may recommend increased spending to address growing security threats from China and North Korea. Some members stress the need for more ammunition, drones, and advanced systems. However, expanding the budget could face political resistance, especially with planned tax hikes and Prime Minister Shigeru Ishiba leading a minority government. Serious budget talks are expected after the summer 2025 House of Councillors election.
Mainichi: https://mainichi.jp/english/articles/20250505/p2g/00m/0na/008000c
▶ Japan, India Agree to Boost Defense Cooperation; Defense Ministers Nakatani, Singh Meet in New Delhi
06 May, 2025
Japanese Defense Minister Gen Nakatani and Indian Defense Minister Rajnath Singh met in New Delhi to strengthen defense cooperation amid growing concerns over China's assertiveness in the Indo-Pacific region. They agreed to enhance joint military exercises, ensure maritime security, and establish a consultation body for defense coordination. Both ministers emphasized shared values and the need to ensure a rules-based order. Japan also expressed interest in defense technology exports to India. While India maintains a nonaligned stance, the two countries aim to deepen bilateral defense ties alongside cooperation within the Quad framework.
Yomiuri: https://japannews.yomiuri.co.jp/politics/politics-government/20250506-252972/
▶ Japan creating battery that can run for 100 years in outer space
06 May, 2025
Japan is developing a long-lasting, maintenance-free battery using the radioactive element americium to power space missions for up to 100 years, even under extreme conditions. Led by the Japan Atomic Energy Agency (JAEA) and JAXA, the project targets use in deep space and lunar environments, where solar power is limited. Americium, previously seen as unsuitable for energy, is now being used for its steady heat output from nuclear decay. The goal is to create a compact prototype by 2029, with support from the government’s Space Strategy Fund.
Asahi: https://www.asahi.com/ajw/articles/15720453
▶ Japan considers joining EU's $100bn science research initiative
07 May, 2025
Japan is considering joining the EU's Horizon Europe R&D program from 2026, potentially boosting innovation by giving Japanese companies and universities greater access to European research funding and networks. The €93.5 billion ($106 billion) program supports projects in areas like the environment, digitalization, and health. Japan’s participation would ease financial burdens through a transitional arrangement, as recently adopted by South Korea. Japanese universities and the EU see strong potential in collaboration, especially in advanced materials. Finalizing the agreement depends on funding negotiations and must be completed by the end of 2025.
Nikkei Asia: https://asia.nikkei.com/Politics/International-relations/Japan-considers-joining-EU-s-100bn-science-research-initiative
▶ Japan's top business lobby head warns of fallout from US tariffs
08 May, 2025
Masakazu Tokura, head of Japan’s top business lobby Keidanren, expressed concern over declining corporate sentiment due to uncertainty from U.S. President Trump’s tariff policies. He noted that industries, particularly automotive, steel, and aluminum, are feeling the strain, not just from the tariffs themselves but from reduced spending and investment. Tokura urged Prime Minister Shigeru Ishiba's government to push harder for the elimination of tariffs in negotiations with the U.S.
Mainichi: https://mainichi.jp/english/articles/20250508/p2g/00m/0bu/016000c
▶ The 6th Japan-EU High-Level Economic Dialogue
08 May, 2025
On May 8, Japan and the EU held the 6th High-Level Economic Dialogue in Tokyo, with key ministers from both sides reaffirming their strategic partnership. Discussions focused on strengthening the rules-based international order, reforming the WTO, and enhancing economic security. Both parties emphasized cooperation on transparent, resilient, and sustainable supply chains, especially for critical minerals and emerging technologies. They agreed to deepen collaboration through the G7 and with developing countries, aiming to boost global governance and industrial competitiveness.
MOFA: https://www.mofa.go.jp/press/release/pressite_000001_01241.html
Business News
▶ Japan's Fujitsu, Riken push ahead with quantum computer development
06 May, 2025
Fujitsu and Japan's Riken institute have developed a 256-qubit superconducting quantum computer, aiming to launch a 1,000-qubit version by fiscal 2026. The new system, building on a 64-qubit model from 2023, will be made available in June. While millions of qubits are needed for reliable large-scale computing, this marks a significant step. Quantum computing, which can solve complex problems far faster than classical computers, is seeing global competition due to its potential applications in fields like finance and pharmaceuticals.
Mainichi: https://mainichi.jp/english/articles/20250506/p2g/00m/0bu/032000c
▶ Mitsubishi Electric, Hitachi launch remote power inspection services
06 May, 2025
Japanese electronics firms like Mitsubishi Electric and Hitachi are launching advanced monitoring services to detect power infrastructure failures remotely, addressing labor shortages and aging maintenance staff. Mitsubishi's system uses sensors to detect equipment issues and alerts staff via smartphone, while Hitachi's AI analyzes satellite and drone data to find defects in power lines. SMK is developing sensors to monitor bolt tightness in offshore wind turbines, reducing costly manual inspections. Oki Electric, with Sompo Japan, is testing undersea cable monitoring to detect damage early. These technologies aim to enhance infrastructure reliability and support Japan’s renewable energy expansion.
Nikkei Asia: https://asia.nikkei.com/Business/Energy/Mitsubishi-Electric-Hitachi-launch-remote-power-inspection-services
▶ Japan satellite operators amp up investment as commercial demand rises
07 May, 2025
SkyPerfect JSAT, Asia's largest satellite operator, is nearly tripling its capital investment in fiscal 2025 to ¥70 billion ($483 million) as it shifts focus from geostationary satellites to a "multi-layered communication network" including low-Earth orbit (LEO) satellites and high-altitude platforms. Initially driven by defense demand, JSAT aims to expand into commercial markets such as in-flight Wi-Fi, satellite-to-smartphone services, and real estate monitoring. Axelspace is also expanding its optical satellite fleet to serve growing demand for ESG, carbon credit validation, and financial due diligence using satellite imagery. Both firms see long-term growth in private-sector applications.
Nikkei Asia: https://asia.nikkei.com/Business/Aerospace-Defense-Industries/Japan-satellite-operators-amp-up-investment-as-commercial-demand-rises
▶ Digital disability certificates replace vexing paper versions
07 May, 2025
Osaka-based company Mirairo Inc. has developed a free app that digitizes disability certificates, helping disabled people in Japan access services and discounts more easily. Over 300 local governments and 4,000 businesses now accept the app, which generates verified QR codes based on official documents. The app addresses issues with paper certificates, such as damage and loss, and aims to reduce stigma and improve accessibility. However, challenges remain, including limited awareness, inconsistent adoption, and concerns about promoting private services. Experts say digitization is a positive step but stress the need for broader reform in disability verification processes.
Asahi: https://www.asahi.com/ajw/articles/15710893
▶ Mitsubishi Heavy talks to 200 suppliers to rebuild Japan nuclear reactors
07 May, 2025
Mitsubishi Heavy Industries is working with over 200 suppliers to prepare for the next generation of nuclear reactors in Japan, aiming to launch an advanced light-water reactor by the 2030s. The company is securing critical components and technology amid growing global demand for zero-emission energy and renewed interest in nuclear power, driven partly by data center energy needs. Japan plans to replace aging reactors, though no projects are confirmed yet. Mitsubishi's preparations seek to maintain Japan’s nuclear technology capabilities and competitiveness, especially as countries like China expand rapidly in this field.
Nikkei Asia: https://asia.nikkei.com/Business/Energy/Mitsubishi-Heavy-talks-to-200-suppliers-to-rebuild-Japan-nuclear-reactors
▶ Toyota buys 40% stake in Indonesia used-car seller Astra Digital Mobil
07 May, 2025
Toyota Motor has acquired a 40% stake in Indonesian used-car dealer Astra Digital Mobil for $120 million to strengthen its presence in Indonesia’s second-hand vehicle market. The remaining 60% is held by Astra International, with which Toyota has an ongoing partnership, including a local joint venture. Astra Digital Mobil operates in 10 major Indonesian cities.
Nikkei Asia: https://asia.nikkei.com/Business/Business-deals/Toyota-buys-40-stake-in-Indonesia-used-car-seller-Astra-Digital-Mobil
▶ Japan’s KDDI Introduces Direct Mobile Phone Connections via SpaceX’s Starlink Satellite Network
07 May, 2025
KDDI has begun offering Japan’s first satellite-based smartphone service using SpaceX’s Starlink network, allowing au subscribers to send and receive messages in remote areas without mobile coverage. Internet access will be available from summer 2025. The service is currently free and compatible with select iPhone, Galaxy, and other Starlink-ready models. It enables SMS, location sharing, and emergency alerts in areas like mountains and at sea. KDDI previously used Starlink to support disaster-hit areas after the Noto Peninsula Earthquake.
Yomiuri: https://japannews.yomiuri.co.jp/business/companies/20250507-253087/
▶ Fujifilm to tap India's growing chip industry with new materials plant
07 May, 2025
Fujifilm Holdings will build a semiconductor materials factory in Gujarat, India, by 2028 to support the country's growing chip industry and reduce reliance on China. The plant will initially supply Tata Electronics, which is partnering with Taiwan’s Powerchip to build a chip factory for automotive semiconductors. Until the new plant is ready, Fujifilm will supply materials from its global facilities. This move aligns with India's $9 billion semiconductor push and broader efforts by global tech firms, including Japan's Renesas and Tokyo Electron, to shift production away from China and expand operations in India.
▶ Japanese drugmaker Shionogi to acquire JT's pharma units in $1.1bn deal
07 May, 2025
Japanese drugmaker Shionogi will acquire Torii Pharmaceutical and other pharmaceutical assets from Japan Tobacco (JT) in a 160 billion yen ($1.1 billion) deal, marking JT’s full exit from the pharma sector. Shionogi will offer a 21% premium per share in a tender offer starting Thursday, after which Torii will be delisted. The acquisition aims to strengthen Shionogi’s drug development capabilities by integrating Torii’s dermatology and allergy expertise with its own infectious disease and respiratory focus. This deal reflects a broader trend of consolidation in Japan’s pharmaceutical industry amid rising R&D costs.
▶ Private Japanese lunar lander enters orbit around moon ahead of a June touchdown
07 May, 2025
Japanese company ispace announced its Resilience lunar lander has entered orbit around the moon and is set to attempt a landing in early June. Launched by SpaceX in January alongside Firefly Aerospace’s lander, Resilience follows ispace’s first failed attempt in 2023. The lander carries a mini rover equipped to collect lunar soil and conduct experiments. If successful, it will mark Japan’s first private moon landing.
Asahi: https://www.asahi.com/ajw/articles/15747711
▶ Japan's KDDI and NEC to partner on supply chain, infrastructure cybersecurity
08 May, 2025
Japanese telecom company KDDI and IT group NEC plan to launch a joint cybersecurity business this year to strengthen protection of critical infrastructure and supply chains. Challenging NTT's dominance in Japan's cybersecurity field, the two aim to expand globally by combining NEC’s expertise in government systems and KDDI’s global monitoring capabilities. They intend to establish 24/7 overseas operation centers and use AI to assess vulnerabilities. This move comes amid rising geopolitical risks and increasing demand for stronger cyberdefenses. A new Japanese law on "active cyberdefense" is also expected to boost industry activity.
Nikkei Asia: https://asia.nikkei.com/Spotlight/Cybersecurity/Japan-s-KDDI-and-NEC-to-partner-on-supply-chain-infrastructure-cybersecurity
▶JFE to Halt Blast Furnace in Western Japan in FY 2027
08 May, 2025
JFE Steel will shut down one of its three blast furnaces in Fukuyama, Hiroshima Prefecture, by fiscal 2027 to reduce costs and address domestic overcapacity. The move is part of a broader strategy to focus on decarbonization and expand overseas operations, according to parent company JFE Holdings.
Jiji: https://jen.jiji.com/jc/eng?g=ind&k=2025050801109
▶ Toyota braces for 35% profit fall this year, says outlook murky
08 May, 2025
Toyota Motor forecasts a net profit of 3.1 trillion yen ($21.5 billion) for the fiscal year ending March 2026, a 34.9% drop from the previous year, due to a stronger yen, rising material costs, and new U.S. tariffs. The 25% tariff on imported cars, imposed by President Trump in April, is expected to cost Toyota 180 billion yen, with further impact uncertain. Despite this, Toyota expects strong U.S. sales, especially of hybrids, and does not plan short-term price hikes. The company will adjust exports and continue localizing production abroad, while maintaining a strong domestic manufacturing base in Japan.
Nikkei Asia: https://asia.nikkei.com/Business/Automobiles/Toyota-forecasts-35-fall-in-full-year-net-profit-amid-Trump-tariffs
▶ Mitsubishi eyes North America production with Nissan amid Trump tariffs
09 May,2025
Mitsubishi Motors is considering producing vehicles at a Nissan plant in North America to counter the impact of new U.S. tariffs, which are expected to cost the company 40 billion yen. Mitsubishi, which ended U.S. production in 2015, is vulnerable due to its reliance on imports. The potential partnership would also help boost underutilized Nissan facilities. Mitsubishi forecasts a 28% drop in operating profit for fiscal 2025 to 100 billion yen, with U.S. sales expected to decline 18%. Despite this, global sales are projected to grow 4% on strong Southeast Asian demand.
Nikkei Asia: https://asia.nikkei.com/Business/Automobiles/Mitsubishi-eyes-North-America-production-with-Nissan-amid-Trump-tariffs
▶Takeda Pharmaceutical to invest $30bn in US over 5 years: CEO
09 May, 2025
Takeda Pharmaceuticals will invest $30 billion in the U.S. over the next five years to upgrade manufacturing facilities and boost research and development, CEO Christophe Weber announced. The move aims to strengthen Takeda’s U.S. presence and mitigate risks from potential drug tariffs proposed by the Trump administration. Takeda operates seven U.S. plants, producing treatments like Entyvio and plasma-derived products. This aligns with similar large-scale investment plans by global pharmaceutical companies, including Novartis, Roche, Eli Lilly, and Johnson & Johnson.
Nikkei Asia: https://asia.nikkei.com/Business/Pharmaceuticals/Takeda-Pharmaceutical-to-invest-30bn-in-US-over-5-years-CEO
