Japan last week passed its long-anticipated economic security bill.
The legislation is the product of foundational changes in the global economy and a bureaucratic reorganization launched a few years ago to respond to that evolution. The bill is part of a larger reorientation of national security that is more economic in focus, which is, not coincidentally, reinforcing geopolitical divisions.
The new legislation has four pillars. The first aims to strengthen key supply chains, specifically identifying those for semiconductors, high-capacity batteries, pharmaceuticals and other vital components such as rare earths. The second seeks to facilitate development of cutting-edge technologies, such as artificial intelligence, through public-private cooperation. Among its provisions, the bill sets up a fund, reportedly to eventually total ¥500 billion, to invest government money in promising initiatives.