The multi-billion euro industrial policy package between Japan and the USA is set to have a major impact.
In return for Japan’s investments, Washington is lowering tariffs on Japanese cars from 25% to 15% and opening up the market for other Japanese goods. In addition to sectors such as energy, semiconductors and pharmaceuticals, American civil and military shipbuilding are among the main beneficiaries of this major package.
Focus on shipyards, car carriers and LNG ships
According to a White House fact sheet, Japanese companies are expected to invest in building new shipyards and the modernization of existing facilities in the USA.
This includes the construction of car carriers and LNG ships as well as cooperation in the field of naval vessels and icebreakers. One of the aims is to establish a maritime supply chain between the USA and Japan that operates independently of China.
The investment package was negotiated for months between the US government and the Japanese side. Secretary of Commerce Howard Lutnick proposed placing the fund directly under the control of President Donald Trump.
Under the agreement, the United States is set to retain 90% of the income from the fund. This is not only the largest foreign investment in U.S. history but also an unprecedented allocation of international funds under the direct leadership of a U.S. president.
Implementation uncertain due to private sector involvement
Japanese shipyards have already expressed strong interest in participating in Trump’s plans to revitalize US shipbuilding. South Korean companies such as Hanwha Ocean and HD Hyundai have also formed strategic alliances in the United States in recent months.
In this context, Tokyo and Washington are discussing the establishment of a bilateral fund for shipbuilding development.
However, experts emphasize that a significant portion of the investment will probably have to come from Japan’s private sector. Their decisions will depend on market conditions over which governments have only limited control. It remains to be seen whether the plan will be fully implemented. Still, the agreement sends a clear signal of geopolitical decoupling from China and a push to strengthen the U.S. maritime industry.
Between strategic opportunity and political balancing act
From a critical standpoint, the investment project raises questions about democratic oversight and geopolitical balance. Granting a single president de facto control over an international multi-billion-dollar package is institutionally unusual and carries the risk of political misuse of economic resources.
The planned preferential treatment of Japanese firms in U.S. defense and shipbuilding contracts could also be seen internationally as a distortion of industrial competition. Geopolitically, the focus is on strategic decoupling. While building an independent supply chain outside China may be necessary from a security perspective, it could disrupt existing trade relations and encourage the formation of new economic blocs. Supporters argue that decoupling is essential to secure critical industries, while critics warn of a dangerous shift toward economic nationalism and renationalization of global economic structures.
