The BGA Japan Team led by Managing Director Kiyoaki “Kiyo” Aburaki wrote an update to clients on Japan’s expanding security ties with the United States and Europe amid key summit meetings.

Context

  • Amid escalating geopolitical tensions, Japanese Prime Minister Fumio Kishida from January 9-14 held summit meetings in France, Italy, the United Kingdom, Canada and the United States to lay the groundwork for the 2023 Group of Seven (G-7) summit. Kishida emphasized that the international community is at a historic turning point, and Japan is taking unprecedented action to address this situation.
  • U.S. President Joe Biden on January 13 expressed his administration’s full support of Japan’s efforts at the bilateral summit in Washington, D.C. The leaders agreed to strengthen economic and technology cooperation, including on semiconductors and space.

Significance

  • Kishida is strengthening the country’s security posture in response to the perceived challenges China poses to the peace and stability of Japan and the Indo-Pacific. Kishida also wants to strengthen G-7 unity against Russia’s aggression toward Ukraine to prevent unilateral changes to the status quo by force in Asia.
  • The Biden team highlighted the alliance’s role in networking U.S. alliances and partnerships in the Indo-Pacific, previewing some sectoral initiatives planned for 2023. The joint statement at the end of the summit noted that both sides would use bilateral ties as a foundation to “bring tangible benefits to the region” in sectors like health, cyber, climate, critical and emerging technologies and maritime domain awareness
  • Kishida publicly reiterated the importance for Washington to enter economic frameworks with market access as a key priority. In a speech at Johns Hopkins University, Kishida said that although Tokyo will work to make the IPEF a success, “the core of what creates economic order in the region is a framework with market access for goods and services.”

Implications

  • Businesses can expect new investment opportunities to materialize as Japan strengthens its economic and security cooperation with key allies and partners, including those in the G-7. Kishida’s visit to five of the G-7 countries was an unqualified success. However, the prime minister’s approval rating at home remains at 30 percent — its lowest since his inauguration. 
  • Businesses should closely monitor Kishida’s response to domestic political challenges. The prime minister will be tested at the ordinary session of the Diet, starting January 23, on whether he can withstand the opposition’s objections and increase public support of his defense agenda. Kishida also faces opposition from within the ruling Liberal Democratic Party (LDP).

We will continue to keep you updated on developments in Japan as they occur. If you have any comments or questions, please contact BGA Japan Managing Director Kiyoaki Aburaki at kaburaki@bowergroupasia.com.

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Managing Director

Kiyo understands the Japanese business community inside and out from his three decades working for Japan’s most powerful business organization, Keidanren. He covers international trade and investment, defense and aerospace, information technology, entrepreneurship, deregulation and data privacy policy. He also played a leading role in developing and implementing political strategies for the private sector. Kiyo has led Keidanren’s strategic international initiatives since 2013, and most recently headed up the federation’s international engagement. He worked closely with former Prime Minister Yasuo Fukuda to establish Japan’s Track 1.5 dialogues with the United States and China. The dialogues produced important results by strengthening ... Read More