Japan has suggested creating a joint investment fund with the United States to help rebuild America’s struggling shipbuilding industry, according to Japanese government sources. The proposal came during negotiations to lift trade tariffs originally imposed by former President Donald Trump.
Officials say the proposed fund would serve two main goals: create manufacturing jobs in the U.S. and reduce dependency on China, currently the world’s largest shipbuilder. By working together, Japan and the U.S. hope to counter potential economic and security risks tied to China’s dominance in the global shipbuilding market.
Japan presented a broader initiative titled the “Japan-U.S. Golden Age of Shipbuilding Plan” during the tariff talks. In addition to the joint fund, the plan includes support for maintaining U.S. ship-repair docks and developing next-generation, carbon-neutral ships powered by ammonia, as well as advanced icebreakers.
Once a global leader in shipbuilding, the U.S. now holds just 0.1% of the international market, according to a U.S. think tank. President Trump has voiced strong support for rebuilding American manufacturing and signed an executive order in April to revitalize U.S. shipyards.
Japan sees this shared interest in rebuilding shipbuilding as a key bargaining chip in the ongoing trade discussions.
“There has been ongoing discussion about bilateral cooperation since the Japan-U.S. summit in February,” said a senior Japanese Foreign Ministry official.
The partnership could also benefit Japan’s own shipbuilding sector, which led the world until the 1990s. Tokyo is also considering a broader alliance involving South Korea, currently the world’s second-largest shipbuilder, to further strengthen regional capacity.
Officials warn that if China’s ship production drops due to an economic crisis or other issues, the world could face a shortage of vessels. Closer cooperation between Japan and the U.S. could help reduce that risk by boosting their own production abilities.
“Our national interests are closely aligned,” said one Japanese government official.
Still, the plan faces challenges. Experts from Japan’s shipbuilding industry point out concerns about high labor costs in the U.S. and the time required to build a new supply chain for parts and materials.
Prime Minister Shigeru Ishiba also supports the idea of closer shipbuilding ties. During a visit on May 25 to a Japan Marine United Corp. repair facility in Maizuru, Kyoto Prefecture, Ishiba noted that the U.S. has shown interest in using Japanese yards to service American warships.
“If possible, the Japanese government would like to support this effort,” Ishiba said.
