Japanese Govt Eyes U.S. Cooperation in Reviving Shipbuilding Industry

The Yomiuri Shimbun

20:00 JST, May 23, 2025

The government will launch measures to revive the shipbuilding industry, which has been declining for a long time, according to sources. It will support the private sector in the construction and repair of shipbuilding docks and in starting businesses overseas.

China has an overwhelming share of the world’s shipbuilding market, and economic security concerns are growing in the international community. As the administration of U.S. President Donald Trump regards strengthening the country’s shipbuilding capability as one of its important policies, Japan hopes to promote cooperation with the United States in this area and use it as a bargaining chip in the upcoming tariff negotiations.

The government aims to support the domestic industry and promote cooperation with the United States at the same time. It will include specific measures in its Basic Policy on Economic and Fiscal Management and Reform, also known as the “big-boned policy,” and secure the necessary budget.

As for domestic measures, it will support domestic investment, technology development and establishing data infrastructure in the shipbuilding industry through the Economic Security Promotion Law. This is in consideration of the fact that shipbuilding is a dual-use industry, which develops and produces vessels for both private and military purposes. To strengthen domestic shipbuilding capability, which is currently insufficient to meet the recent increase in demand, the government will support to construct new shipbuilding docks by reviving unused docks and dockyards.

The government will also increase the budget related to green transformation to support the building of ships that include next-generation vessels fueled by blue ammonia. Blue ammonia is produced from fossil fuel in which the carbon dioxide emissions generated during the process are captured and stored.

The government will also help Japanese companies construct large-scale docks overseas and start businesses in those locations.

As for possible Japan-U.S. cooperation, the government is considering a “Japan-U.S. fund for reviving the shipbuilding industry.” It will propose joint construction of blue ammonia ships and vehicle carriers, hoping to utilize Japan’s design capabilities and Japan-made manufacturing parts. It will support Japanese and U.S. companies to construct dockyards in the United States.

Based on the technology of Japanese icebreaker Shirase, it plans to jointly develop and produce new icebreakers and cooperate in repairing warships with the United States. It also aims to establish a supply chain between Japan and the United States to avoid too much dependence on China.

China currently has a 70% share of newly built ships and 90% share of ship repair. Japan had a 50% share of newly built ships in the early 1990s, but currently has only 10%. As Japan depends on China for its supply of ships, its maritime transportation may be affected in a contingency. Japan aims to strengthen its economic security by reviving its shipbuilding industry.

The Trump administration also aims to revive the U.S. shipbuilding industry. It has already started to eliminate Chinese ships; the U.S. government said it would collect fees from China-made ships when they enter U.S. ports.

Japan and the United States were to hold their third ministerial meeting about the tariffs on Friday. Japan intends to convey to the U.S. government its intent to cooperate in reviving both countries’ shipbuilding industries, hoping to extract concessions in the negotiations.