Japanese lawmakers rush to bolster economic security

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Japanese lawmakers are pursuing an economic security bill with a new sense of urgency. It was created to address longer-term geopolitical risks stemming from the US-China rivalry, but is now also seen as a response to much more imminent supply chain threats from the Russian invasion. from Ukraine.

The bill, submitted in February, was passed last week. It consists of four pillars to protect Japan’s infrastructure, supply chains, patents and technology, and is expected to come into effect in phases.

To protect the country’s infrastructure from cyberattacks, companies in 14 sectors – including energy, water supply, finance and transport – will be required to inform the government before any equipment purchases or upgrades are made. software update.

Japanese lawmakers passed legislation aimed at bolstering the country’s economic security on May 11.

Secret patents

A new system will allow secret patents that cannot be shared outside of Japan. The goal is to ensure that technological breakthroughs are not used overseas for military purposes.

Grants are going to be offered to companies that can help strengthen essential supply chains. This includes semiconductors and pharmaceuticals. The government will also investigate sectors that are too dependent on foreign products.

The coronavirus pandemic has disrupted the supply of essential products to industry. The shortage of semiconductors has been particularly severe, causing automobile production to be suspended.

The law also allows the Japanese government to share information and offer financial support to companies involved in research and development of advanced technologies.

Distrustful business leaders

Despite growing geopolitical risks, Japanese companies are wary of the changes that are expected to be implemented over the next two years. Keidanren, or the Japan Business Federation, issued a statement that welcomes stronger economic security but urges the government to keep interference to a minimum. The group also calls for transparency.

Lawmakers and government officials argue that new measures, including a security clearance system, are needed to protect Japan. They claim this will help screen and certify those eligible to access classified documents relating to national and economic security.

Biden to tout new executive

Supply chain issues will be on the agenda when US President Joe Biden visits Japan in the coming days for talks with Prime Minister Kishida Fumio. Leaders should agree on deepening cooperation.

US President Joe Biden is due to have a summit meeting with Japanese Prime Minister Kishida Fumio in Tokyo on May 23. This will be Biden’s first visit to Japan as president.

They are also set to announce that the two countries will work together to protect advanced technologies and ensure the availability of semiconductor stocks in case of emergency.

Regional economic security will be one of the main topics of discussion at the US-Japan summit. Biden is promoting an initiative called the Indo-Pacific Economic Framework that covers a wide range of issues facing the region, including trade, supply chains, infrastructure, environment, taxation and governance.

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