Japan Taps Emerging Economies to Diversify Supply Chains

Tokyo, June 30 (Jiji Press)–It is important for Japan to strengthen ties with emerging economies as part of efforts to diversify supply chains for critical minerals and energy sources, the Japanese government said in a white paper released Tuesday. The 2026 White Paper on International Economy and Trade emphasized the need to address supply chain risks highlighted by China’s export controls and turmoil in the Middle East. Against this background, the government positioned direct investment in emerging economies as an effective policy tool because they are becoming increasingly important resource suppliers. The global economy grew steadily in 2025 despite high tariffs imposed by the United States, according to the white paper submitted to a cabinet meeting by industry minister Ryosei Akazawa. Still, the paper warned that uncertainty surrounding global economic policies, including U.S. President Donald Trump’s “America First” policies and China’s export restrictions on critical minerals, had reached its highest level since 2000. Regarding the de facto blockade of the Strait of Hormuz, the paper pointed out the risks of dependence on specific regions, noting that Asia, which relies heavily on the Middle East for crude oil and naphtha, would be most vulnerable. Given the growing dependence of members of the Association of Southeast Asian Nations on China for intermediate goods such as parts and materials, the paper emphasized the need to ensure trade stability based on international rules and to increase Japan’s exports of intermediate goods in order to mitigate the risk of supply disruptions. The government also outlined a strategy to build resilient supply chains through global crisis management investment by linking domestic investment in 17 strategic sectors with foreign direct investment. It aims to create a virtuous cycle of domestic industrial growth driven by increased exports and the reinvestment of profits. END [Copyright The Jiji Press, Ltd.]