Global Economy & Policy Insight Weekly

Research evidence excerpt

Global Economy & Policy Insight Weekly

Global Economy & Policy Insight

Weekly

1 July 2026

Issues with the government’s plan to invest in 17

strategic sectors TakahideNomura ResearchKiuchi is Institute.executiveThiseconomistis his at

personal view.

Summary: The Japanese government has announced a plan for public–private Takahide Kiuchi

t-kiuchi@nri.co.jp

investment in 17 strategic areas. The plan targets public–private investments totaling

around ¥370trn through FY40. While it is meaningful to promote an industrial policy that

aims to transform the nation’s industrial structure, enhance international

competitiveness, create new demand, and strengthen medium-term growth potential,

this plan to promote public–private investments in 17 strategic sectors is complicated

by several issues. For this plan to be successful, the government will need to

implement carefully designed measures. The first issue is that the government’s

To receive this publication, pleaseannounced plan is wide-sweeping and lacks coherence. It lacks a grand design for a

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growth strategy that will improve Japanese companies' international competitiveness representative.

and productivity, and it does not provide a clear vision for the future shape of the

Japanese economy. Furthermore, it presents the risk of excessive government

involvement in private-sector investments distorting corporate activities and worsening

Japan’s fiscal environment. The government should promote a growth strategy that

secures needed financial resources by narrowing down the targeted wide-sweeping 17

strategic sectors to promising and highly profitable sectors where rather small

government investments can attract investment from the private-sector. I would like to