Japan to Establish ¥1 Trillion Fund to Fill Shipbuilding Industry’s Sails, Ensure Economic Security

The Yomiuri Shimbun

14:29 JST, November 14, 2025

The government is planning to establish a ¥1 trillion public-private investment fund dedicated to revitalizing Japan’s ship-building industry, with a goal of doubling the nation’s annual shipbuilding capacity by 2035, The Yomiuri Shimbun has learned.

The fund will be included in a soon-to-be-compiled economic stimulus package, according to multiple government sources.

An industry revival roadmap with such goals as strengthening Japan’s production base will be drawn up from the perspective of ensuring economic security. Based on this, strong support will be provided for research and development and for securing increased maritime transport capacity.

The government plans to establish the fund to ensure a stable supply of capital over several fiscal years.

Japan accounted for about 50% of global output in the shipbuilding industry until the early 1990s. However, the nation’s share had slipped to about 20% in 2023, and many companies have withdrawn from the industry. International logistics relies heavily on maritime shipping, so any disruption in these operations would inevitably have a major impact on people’s day-to-day lives.

A memorandum between Japan and the United States, concluded in line with a summit meeting between Prime Minister Sanae Takaichi and U.S. President Donald Trump on Oct. 28, also stated that strategic investments would be made to modernize shipyards. As China now holds the lion’s share of the global market and has been bolstering its shipbuilding capacity, including of military-use vessels, Tokyo and Washington aim to deepen their cooperation to challenge Beijing’s dominance.

The roadmap will contain the goal of Japan’s annual shipbuilding capacity in 2035 to be double the current level of about 9.1 million tons and spell out steps to achieve that increase, according to the sources. The government and the shipbuilding industry will each contribute about ¥350 billion by 2035, with the remainder expected to be provided by sources including government-affiliated financial institutions harnessing the Fiscal Investment and Loan Program. By setting up the fund, the government plans to support continuous capital investment by industry operators to achieve the roadmap’s goals.

The public and private capital would also be used to cover the development of human resources who would be engaged in building ships. It would likely also be used to support the development of shipbuilding techniques that utilize cutting-edge technologies, such as artificial intelligence and robots, as well as next-generation vessels powered by alternative fuels such as hydrogen and ammonia.