Japan & the US strengthen economic security through commercial diplomacy

The two countries will establish a new joint research centre geared toward next-generation semiconductors

Japan’s economy saw growth on the back of solid consumer spending in face-to-face services.

From April to June, Japan’s economy grew at 2.5 percent YoY, recovering from a 0.5 percent contraction in Q1, according to CNBC. In Q2, growth was mostly driven by private consumption, which was forecast to increase by 1.3 percent. More than half of Japan’s GDP is derived from this.

Saisuke Sakai, senior economist at Mizuho Research and Technologies noted that recovery will slow down from July until September on the back of the renewed COVID outbreak, along with other risk factors, including inflation and the state of the global economy.

With the intention of countering China’s rising economic and military power, the governments of Japan and the United States have voiced their motives regarding economic security. The two countries aim to closely collaborate through commercial diplomacy.

The two countries will establish a new joint research centre geared toward next-generation semiconductors.

More: Japan’s move toward greener data centres

In contrast to Japan, which excels in semiconductor manufacturing machinery and components, the United States is strong in chip design and development, reported Reuters.

Japan has additionally stated that it will provide up to JPY92.9 billion (USD700 million) to Western Digital Corp. and partner Kioxia Holdings to increase memory chip production at a plant in Japan.

Panasonic Holdings Corp, a supplier for Tesla, chose Kansas as the location for a new battery plant last month. According to Rahm Emanuel, former mayor of Chicago, the agreement was reached after U.S. w President Joe Biden spoke with representatives of Panasonic during his stay in Japan.

Countries such as the United States and Japan have increased investment in chip production. This is due to concerns regarding the conflict between China and Taiwan, which produces the vast majority of semiconductors under 10 nanometres used in smartphones.

The Property Report editors wrote this article. For more information, email: [email protected].