Japan plans major AI, chip and space investment push

Anabelle Colaco
24 Jun 2026, 07:18 GMT+10

Japan is planning a major public-private investment drive worth about 370 trillion yen (US$2.3 trillion) through 2040, with artificial intelligence, semiconductors, and space development among the sectors expected to receive priority support
The initiative is expected to form part of Prime Minister Sanae Takaichi's new growth strategy. It could be unveiled as early as the week of June 22, according to the Japanese business daily
The strategy is expected to focus on areas such as AI, chip production, and space technology, sectors where Japan is seeking to strengthen domestic capabilities amid growing global competition

TOKYO, Japan: Japan is planning a major public-private investment drive worth about 370 trillion yen (US$2.3 trillion) through 2040, with artificial intelligence, semiconductors, and space development among the sectors expected to receive priority support, the Nikkei reported on June 19.

The initiative is expected to form part of Prime Minister Sanae Takaichi's new growth strategy. It could be unveiled as early as the week of June 22, according to the Japanese business daily.

The proposed plan would target investment across 17 strategic sectors, using government spending to encourage greater private-sector participation in industries viewed as important to Japan's future economic competitiveness and security.

The strategy is expected to focus on areas such as AI, chip production, and space technology, sectors where Japan is seeking to strengthen domestic capabilities amid growing global competition.

The Nikkei did not cite a source for the report.

A comment was sought from the Prime Minister's Office on June 20, but the office did not respond outside business hours.

The government is also considering a multi-year budget framework to provide more stable funding for projects considered critical to economic security, the report said.

Some of the spending could be financed through bridging bonds, which are used to cover temporary funding needs and are issued with guarantees of specific repayment methods.

The approach would allow Japan's heavily indebted government to argue that it is maintaining fiscal discipline while increasing spending on strategic investment.