This conversation with David Arase, resident professor of international politics at the Johns Hopkins University Nanjing University Center for Chinese and American Studies, explores Japan’s recent push to move critical production away from China.

Explain the rationale behind Tokyo’s recent ¥243.5 billion stimulus package to help Japanese companies move production out of China.

There are two immediate reasons to reduce supply chain dependence on China. One is that many Japanese firms have “bet on China” and depend exclusively on Chinese factories and firms to provide critically important goods. COVID-19 highlighted the risk of making China a single point-of-failure in Japan’s global and regional supply chains.