Weekly Japanese Industry and Policy News: 12 July - 18 July, 2025

The EU Japan Centre is releasing a weekly press review covering Japan's economic and policy matters.

 

Economic News

 

▶ Japan and EU envision satellite network to cut reliance on US, SpaceX

12 July, 2025

Japan and the EU plan to jointly develop a communications satellite constellation to reduce reliance on U.S. companies like SpaceX and enhance digital and security resilience. At their July 23 summit, leaders are expected to agree on launching and operating small satellites, advancing public-private partnerships, and collaborating on space technologies, climate data, and space debris issues. The agreement also includes strengthening defense industry ties, forming a competitiveness alliance, and reaffirming shared values on international law and regional security, particularly regarding China and the Indo-Pacific.

Nikkei Asia: https://asia.nikkei.com/Business/Aerospace-Defense-Industries/Japan-and-EU-envision-satellite-network-to-cut-reliance-on-US-SpaceX

 

▶ Japan's aid agency to issue 23 bil. yen Africa-support bonds in Aug.

13 July, 2025

The Japan International Cooperation Agency (JICA) will issue around 23 billion yen ($160 million) in bonds next month to support development projects in Africa, including infrastructure, education, and agriculture. The bond issuance coincides with the Tokyo International Conference on African Development (TICAD 9), to be held in Yokohama from August 20–22. JICA aims to attract Japanese companies and institutions interested in Africa's growth potential. The funds will support initiatives such as Japanese-style education, farmer financing, and infrastructure development, building on previous TICAD bond successes like projects in Uganda and Kenya.

Kyodo: https://english.kyodonews.net/articles/-/57192

 

▶ Japanese Firms Investing More in India Amid Rapid Economic Growth

15 July, 2025

Japanese manufacturing companies are rapidly increasing investments in India, attracted by its large population, strong domestic demand, and resilience to U.S. tariff impacts. India’s relatively low export ratio means U.S. tariffs have limited effect on its economy. Major Japanese firms like Honda, Suzuki, Daikin, and Daifuku are expanding production and facilities. The IMF forecasts India’s economic growth to exceed 6% annually through 2030, attracting global investment. However, ongoing U.S.-India tariff negotiations may prompt India to adjust its high tariffs and subsidy policies, potentially changing the business environment.

Yomiuri: https://japannews.yomiuri.co.jp/business/companies/20250715-269533/

 

▶ Courtesy Call on Minister IWAYA Takeshi and presentation of the Joint Recommendation by the Japan-EU Business Round Table (BRT) Co-Chair Mr. ENDO Nobuhiro

15 July, 2025

During the courtesy call on July 15, Minister Iwaya received Mr. Nobuhiro Endo, Co-Chair of the Japan-EU Business Round Table (BRT), who presented the BRT’s joint recommendations from its February 2025 meeting. Minister Iwaya emphasized the importance of Japan-EU cooperation in economic security and industrial competitiveness, and expressed hope for continued public-private collaboration through the BRT framework.

MOFA: https://www.mofa.go.jp/press/release/pressite_000001_01451.html

METI(Japanese): https://www.meti.go.jp/press/2025/07/20250715004/20250715004.html

MIC(Japanese): https://www.soumu.go.jp/photo_gallery/02koho03_03005323.html

 

▶ Japan to build new survey ship to hunt for deep-sea rare earths

16 July, 2025

Japan is prioritizing deep-sea exploration as a strategic measure to strengthen its economic security, particularly by securing access to rare earth elements—critical materials for electric vehicles, electronics, and defense technologies. These resources are essential for Japan’s industrial competitiveness and technological independence.

Currently, China dominates the global supply of rare earths, accounting for about 70% of production. In recent years, Beijing has demonstrated its willingness to restrict exports for geopolitical leverage, including in response to trade tensions with the United States. This has raised concerns in Tokyo about overdependence on a single supplier for such vital resources. To address this vulnerability, Japan is investing in a new deep-sea research support ship, capable of deploying multiple submersibles and autonomous vehicles to explore and assess marine mineral deposits. The ship will play a key role in unlocking the vast rare earth reserves located in Japan’s exclusive economic zone, particularly near Minamitorishima, where University of Tokyo research estimates over 16 million metric tons of rare earths lie buried. Japan aims to begin rare earth mining operations by fiscal 2028, a move that could significantly reduce its reliance on foreign sources and enhance supply chain resilience. The new vessel is a cornerstone of this effort, helping Japan build a stable domestic supply of strategic minerals and bolster its position in global technological and economic competition.

In parallel, Japan is exploring cooperation with the United States on rare earth procurement, positioning these materials as a critical component of broader economic security and diplomatic strategy.

Nikkei Asia: https://asia.nikkei.com/Politics/Japan-to-build-new-survey-ship-to-hunt-for-deep-sea-rare-earths2

 

▶ Chances of partner joining U.K.-Italian-Japanese fighter jet project diminishing, BAE executive says

16 July, 2025

The likelihood of a new country, such as Saudi Arabia, joining the Japan-led Global Combat Air Program (GCAP)—a joint fighter jet development project with the UK and Italy—is decreasing, according to BAE Systems’ managing director Herman Claesen. While Japan, along with the UK and Italy, leads efforts to produce a next-generation stealth aircraft by 2035, adding a new partner now could cause delays. GCAP, which includes Japan’s Mitsubishi Heavy Industries, is advancing steadily compared to a rival Franco-German project. The program aims to deliver an advanced fighter jet known as Tempest in the UK, with Japan playing a key role in its development and future market.

Asahi: https://www.asahi.com/ajw/articles/15909737

 

▶ Japan and EU to elevate ties, explore joint rare-earths procurement

18 July, 2025

Japan and the EU will launch a new “economic two-plus-two” dialogue, bringing together top foreign and economic officials to deepen cooperation and reduce dependence on China in areas like rare-earth procurement. The initiative, to be announced at the upcoming Japan-EU summit, includes a "competitiveness alliance" to jointly develop critical mineral supply chains and explore Japanese involvement in EU projects in regions like Greenland and Africa. The dialogue will also address easing EU regulations that affect Japanese businesses, aiming to create a more business-friendly environment.

Nikkei Asia: https://asia.nikkei.com/Politics/International-relations/Japan-and-EU-to-elevate-ties-explore-joint-rare-earths-procurement

 

Business News

 

▶ IHI and Vopak to sign a joint development agreement for the proposed establishment of joint venture for the development and operation of an ammonia terminal in Japan

11 July, 2025

IHI Corporation and Royal Vopak have signed a joint development agreement to establish a joint venture aimed at building and operating an ammonia terminal in Japan by fiscal 2030. The project will support Japan’s decarbonization goals by enabling the import, storage, and stable supply of ammonia for use in power generation and industry. IHI, Japan’s leading ammonia storage tank maker, and Vopak, a global tank storage expert, will combine their expertise to develop safe, efficient infrastructure and a broader ammonia supply chain, including a marine transport hub. This follows an MoU signed in November 2023.

IHI: https://www.ihi.co.jp/en/all_news/2025/resources_energy_environment/1201547_13737.html

 

▶ ITOCHU Announces Newbuilding Order for Ammonia Bunkering Vessel

14 July, 2025

ITOCHU Corporation has signed agreements to build the world’s first ammonia bunkering vessel and its ammonia tank plant through its Singapore-based subsidiary, Clean Ammonia Bunkering Shipping (CABS). This initiative is part of a Japanese government-backed demonstration project to support ammonia-fueled vessels in Singapore. With expected delivery in 2027, the vessel will support ship-to-ship ammonia refueling, a key step in decarbonizing the shipping industry. ITOCHU aims to commercialize ammonia bunkering in Singapore and expand globally, while also supporting Japan’s shipbuilding competitiveness and contributing to international climate goals.

Nikkei Asia: https://www.itochu.co.jp/en/news/press/2025/250714.html

 

▶ Honda, Nissan in talks on sharing common auto software

14 July, 2025

Honda and Nissan are in talks to share basic software for advanced vehicle control, aiming to compete in the growing market for software-defined vehicles (SDVs). The collaboration would help both Japanese automakers accelerate development and cut costs as they seek to catch up with U.S. and Chinese rivals like Tesla. The two companies plan to launch vehicles using the shared software in the latter half of the decade. This move follows earlier discussions on broader cooperation, including sharing EV components and U.S.-made pickup trucks. Despite the collaboration, Honda still plans to release EVs with its own software starting in 2026.

Kyodo: https://english.kyodonews.net/articles/-/57261

 

▶ Mitsubishi Corp. to buy Norwegian salmon aquafarm for $1bn

17 July, 2025

Mitsubishi Corporation is acquiring salmon aquaculture operations in Norway and Canada from Norwegian company Grieg Seafood for approximately $1 billion, through its Oslo-based subsidiary Cermaq Group. The deal, expected to close by October, involves the full acquisition of Grieg’s farming assets and will boost Mitsubishi’s annual salmon production by over 20% to around 250,000 tons. This move will make Mitsubishi the world’s second-largest salmon producer, surpassing Norway’s SalMar, with plans to further expand output to 280,000 tons annually. The acquisition reflects the growing global demand for salmon as a sustainable and environmentally friendly protein source.

Nikkei Asia: https://asia.nikkei.com/Business/Business-deals/Mitsubishi-Corp.-to-buy-Norwegian-salmon-aquafarm-for-1bn

 

▶ TSMC to start 2nd Japan plant construction later this year

17 July, 2025

Taiwan Semiconductor Manufacturing Co. (TSMC) will begin construction of its second semiconductor plant in Kumamoto, Japan, later this year, according to CEO C.C. Wei. The new facility, planned next to its first Japanese plant—which began mass production in late 2024—will produce advanced 6-nanometer chips. While initial plans aimed for construction by March, the timeline was delayed. Despite reports suggesting further postponements due to TSMC’s increased focus on its U.S. operations, the company confirmed that construction in Japan remains on track, depending on the readiness of local infrastructure. The project reflects Japan’s growing importance in the global semiconductor supply chain.

Mainichi: https://mainichi.jp/english/articles/20250717/p2g/00m/0bu/035000c

 

▶ SoftBank to have 1 billion ‘AI agents’ up and running by 2026

17 July, 2025

SoftBank Group plans to have 1 billion AI agents working by the end of this year, with each employee creating over 1,000 customized agents to assist with tasks such as answering questions, replying to emails, making reservations, and system maintenance. Chairman Masayoshi Son explained that these AI agents will be able to make autonomous decisions and take actions independently, such as inspecting and repairing system devices. The company is also developing an operating system to enable cooperation among the AI agents. Son compared employees empowered by AI agents to Senju Kannon, a deity with a thousand arms, highlighting the enhanced capabilities each worker will gain. SoftBank is collaborating with OpenAI on projects like Stargate, a large-scale data center network in the U.S., and recently launched an AI service for Japanese businesses called Cristal Intelligence. Son expressed concerns that Japan’s adoption of generative AI is lagging behind the U.S. and China and emphasized the importance for Japan to actively engage with AI advancements to remain competitive.

Asahi: https://www.asahi.com/ajw/articles/15911358

 

▶ Singtel-led group to build 8,900km Asian subsea cable with NEC

17 July, 2025

A consortium led by Singapore's Singtel and Japan's NEC will build an 8,900-km high-capacity subsea cable, the Asia United Gateway East, linking Japan and Singapore and connecting six other locations including South Korea, Taiwan, and the Philippines. Expected to be completed by 2029, the cable will support growing demand for AI and cloud-driven data traffic. Major tech firms like Amazon Web Services and Microsoft are also part of the consortium. The project reflects the strategic importance of subsea cables as critical infrastructure, especially amid geopolitical and regulatory challenges in the region.

Nikkei Asia: https://asia.nikkei.com/Business/Telecommunication/Singtel-led-group-to-build-8-900km-Asian-subsea-cable-with-NEC

 

▶ Domestic firms play catch-up as Japan shifts to electric buses

18 July, 2025

Japanese automakers are struggling to catch up in their own domestic electric bus market, which is growing amid global trends toward decarbonization. Although Japan currently has only about 580 electric buses—less than 1% of the nation's 210,000 buses—the government and industry aim to increase that number to 10,000 by 2030. Domestic manufacturers like Isuzu and Hino (via their joint venture J-Bus) have started producing EV buses, such as the Erga EV, to counter strong competition from foreign firms like China’s BYD, which holds over 50% of Japan’s EV bus market. Experts say Japan’s delayed response stems from a focus on hybrids and fuel cells, as well as a small market size and long bus replacement cycles. Despite the late start, companies like Isuzu remain optimistic about the competitiveness of their products.

Asahi: https://www.asahi.com/ajw/articles/15878604

 

▶ Nippon Yusen to buy Dutch logistics company for $1.45bn

18 July, 2025

Nippon Yusen (NYK Line) will acquire Dutch health-care logistics firm Movianto for €1.25 billion ($1.45 billion) as part of its strategy to diversify beyond maritime shipping, which is vulnerable to global economic shifts. Movianto, with operations in 12 European countries, specializes in temperature-controlled logistics for medical supplies. The deal, expected to close in December 2025, aligns with NYK's current investment plan focused on expanding its non-maritime logistics business. Strong recent earnings have enabled NYK to invest aggressively, following earlier acquisitions in the U.K. and the Netherlands.

Nikkei Asia: https://asia.nikkei.com/Business/Business-deals/Nippon-Yusen-to-buy-Dutch-logistics-company-for-1.45bn

 

▶ Investment in Licella Holdings, an Australian Company with Oil Conversion Technology Using Supercritical Water

18 July, 2025

Diamond Edge Ventures, the venture arm of Mitsubishi Chemical Group (MCG), has invested in Australian company Licella Holdings to support global expansion of its advanced recycling technology, Cat-HTR™. This technology converts waste plastics and biomass into oil, which can be refined into chemical feedstocks and sustainable aviation fuel (SAF). The investment aligns with MCG’s “KAITEKI Vision 35,” which emphasizes building a stable supply of green chemicals. The partnership aims to accelerate commercial use of recycling technologies and expand MCG’s chemical recycling capacity, including SAF production from forest residues in Japan.

Mitsubishi Chemical Group: https://www.mcgc.com/english/news_release/02387.html