German Chancellor in Japan: Role Model for Secure Supply Chains

by | 16. Mar 2023 - 14:35 | Politics

Raw materials security and diversification key topics during state visit.

Olaf Scholz and most of his cabinet will travel to Japan on Friday for political talks – with raw materials security at the top of his agenda, as the chancellor announced in advance.

Since the Corona pandemic and Russia’s war of aggression exposed Germany’s unilateral import dependencies in numerous areas, the German government has been pushing to diversify the supply chains. Here, Japan could serve as a role model: The country is a leader in supply chain resilience, Handelsblatt quotes Martin Schulz, chief economist at Japanese tech company Fujitsu and a member of an advisory committee to government leader Fumio Kishida. The diversification away from China was accomplished earlier than Germany. German and Japanese government officials plan to exchange views on the issue at their meeting on Saturday.

Japan’s Raw Materials Stockpiling Law: Example for EU?

A Japanese law (we reported) on critical goods such as pharmaceuticals, semiconductors or rare earths could also soon be the prototype for EU legislation, reports the Tagesspiegel. Those who import them have to provide information about stockpiles and conclude contracts with suppliers from different countries. For important raw materials, Japan holds a government reserve for at least 60 days, and a fund has also been set up for investment in mining sites around the world to put the supply of important minerals on a broader basis. Companies would also be encouraged to expand factories outside China in partner countries such as Vietnam; there is nothing comparable in Germany to date.

Meanwhile, Japan is gaining importance for German companies as a possible alternative location to China, writes Handelsblatt. Because of the semiconductor supply problems, the German automotive industry, for example, is increasingly looking to Japan, which is not only an important chip manufacturer but also has good contacts with Taiwan and Southeast Asia, important locations for the semiconductor industry.

Photo: iStock/SeanPavonePhoto

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