The Japanese and U.S. governments held their first “economic two-plus-two” dialogue involving their foreign and industry ministers in Washington, D.C., on July 29 and agreed to cooperate extensively in efforts to develop semiconductors and other cutting-edge technologies and to strengthen supply chains.

There are conspicuous examples of China and Russia abusing their predominance in rare materials and resources. It is hoped that Japan and the U.S. will protect free economic activities, which are the foundation of stable livelihoods, by leading the rules-based international order and preventing undue coercion.

The official name of the new framework is the “Japan-U.S. Economic Policy Consultative Committee.” The framework was agreed upon by the Japanese and American leaders in January this year. The two countries already have a consultative body (two-plus-two) for their foreign and defense ministers. The new framework is positioned as the economic version of the consultative body.

Japanese Foreign Minister Hayashi Yoshimasa, Minister of Economy, Trade, and Industry Hagiuda Koichi, U.S. Secretary of State Antony Blinken, and Commerce Secretary Gina Raimondo participated in the economic dialogue and compiled their achievements in a joint statement and an action plan.

They particularly focused on the semiconductor sector. Semiconductor production is concentrated in Taiwan. Thus a contingency there would  deal a blow to a broad range of industries. Semiconductors are strategic materials whose presence or absence determines economic strength and national strength. Tokyo and Washington agreed to cooperate for their supply and technological development. Japan pledged to establish a research and development organization that would become a hub for international joint research projects involving friendly nations.

In the sectors of rare earth elements and storage batteries, on which the two countries depend on China, they will cooperate on the financial and other fronts in preparation for supply disruptions. They will also promote collaboration in developing safe technologies for the next-generation communications network.

All of these are important issues, but it would be the reverse of our expectation if excessive intervention in the private sector distorts the market. Japan and the U.S. are also required to exercise wisdom, including how to increase the effectiveness of the limited finances.

Japan and the U.S. also need to face the reality that many countries have strong economic ties to China. Dividing supply chains in a blind manner could throw the economy into chaos.

Japan and the U.S. are reportedly planning to explore ways to effectively control the export of weapons and technologies that could be used for surveillance in violation of human rights and to coordinate their standards.

It will be useful if the two countries can share what they have achieved through these efforts with like-minded countries. We hope the new consultative body will contribute to the compatibility of economic security and free trade and economic activities.