Keizai Doyukai Chair Urges Japan to Work With Global South to Rebuild Supply Chains, Reduce Reliance on United States

The Yomiuri Shimbun

20:00 JST, April 29, 2025

Japan should work with emerging and developing countries and rebuild supply chains in an effort to review the U.S.-based trade system, according to Takeshi Niinami, chairperson of the Japan Association of Corporate Executives (Keizai Doyukai).

The following is excerpted from an interview with Niinami, 66, conducted by Yomiuri Shimbun Staff Writer Rintaro Kaizuka.

The tariff measures imposed by U.S. President Donald Trump are a serious warning that the United States is no longer the same as it used to be and other nations should not rely on it. In response to this message, countries around the world are scrambling to strengthen their economies. Japan also must act immediately to enhance its competitiveness with a sense of urgency.

However, the financial markets have produced unintended consequences for Trump. The announcement that reciprocal tariffs would be imposed on U.S. trading partners caused a triple decline in U.S. stocks, Treasury bonds and the dollar. The stock prices of Apple Inc. and other IT giants plummeted.

This reflects the market’s reaction to the wavering confidence in the United States, which had risen due to expectations for growth through technological innovation. The U.S. government’s decision to suspend the full implementation of the tariffs on Japan and other countries for 90 days can be seen as a course correction in response to the markets’ reaction.

Amid the market turmoil, the United States prioritized Japan in the negotiations over reciprocal tariffs. The United States must have decided it would be able to restore market confidence and facilitate negotiations with other countries if it quickly completed negotiations with Japan, which is easy to communicate and negotiate deals with, as a “showcase.”

When it comes to the Trump administration, anything is possible through negotiations. For Japan, the most important issue is lowering tariffs on automobiles, which have the greatest impact on the economy, and the key will be what Japan can offer the United States in return. The world has its eyes on the Japan-U.S. talks, and the business community in Japan hopes that they will proceed with a sense of urgency.

A long-term perspective is also necessary. Behind Trump’s re-election is the anger of people who believe they lost their jobs due to economic globalization, the widening gap between rich and poor, and divisions in society and communities. As long as these issues remain unsolved, the United States may continue to prioritize its own interests even after Trump leaves office.

The instability of the U.S. economy has a negative impact for Japan. Japan must now review its trade system, in which it has relied on the United States, and itself reduce risks. The public and private sectors must work together to build alliances with the emerging and developing countries known as the Global South, and rebuild supply chains. Rather than manufacturing final products, Japan should seek to reap the fruits of growth by exporting machine tools and other items in which it has expertise.

It is also necessary for Japan to revitalize domestic investment. Over the past 30 years, Japanese corporate investment has been heavily skewed toward overseas markets, with insufficient investment flowing into the domestic economy. It is important to advance deregulation and institutional reforms to create an environment in which the private sector can more easily invest domestically, thereby strengthening domestic economic bases.

Japan is home to many companies, both large and small, capable of producing high-value-added products and services. If it fails to focus on these firms and enhance industrial competitiveness, Japan will fall behind the rest of the world.

Takeshi Niinami

Niinami is a graduate of Harvard Business School. He has served as president of Lawson, Inc. and Suntory Holdings Ltd., and was appointed chairperson of Keizai Doyukai in 2023. Niinami is also a private-sector member of the government’s Council on Economic and Fiscal Policy and the chairperson of Suntory Holdings.