(Provisional translation by an external company for reference purpose only)
I would like to make two announcements at the outset today. As for the first matter, as I have repeatedly stated in the Diet and the like recently, through our ongoing exchanges of views with startups, venture capital firms, incubators, and members of the defense industry, we have heard about the issue that some government-affiliated financial institutions impose restrictions on investment in businesses related to weapons and weapon-related products. As a result, venture capital firms that receive funding from such institutions have found themselves unable to invest in the defense sector. In response to these concerns, the Development Bank of Japan (DBJ) has now lifted restrictions on investments in businesses related to weapons and weapon-related products, with the exception of inhumane weapons prohibited under international treaties. This move will support the entry of Japanese startups into the defense sector and help strengthen the defense industry. Had such measures not been taken, and had domestic investors continued to hesitate to invest in defense-related businesses, there was concern that only foreign-affiliated firms would be left to handle defense-related investment projects, which could have affected the development of a defense innovation ecosystem. As Minister of Defense, I welcome this decision and would also like to express my sincere gratitude to everyone at DBJ for responding swiftly while taking into account also the views of the private sector. Negative opinions and perceptions regarding the defense industry can still be seen, including concerns about so-called reputational risk—that engaging in defense business could damage a company’s reputation and adversely affect its other business. However, this situation must be changed. I believe that it is important to promote the correct understanding that the defense industry is one that serves the public interest as it is directly connected to protecting the lives of the Japanese people, and that it can also contribute to Japan’s economic growth through ripple effects into the civilian sector, including the creation of new technologies that benefit the everyday life of citizens. The Ministry of Defense (MOD) will continue to convey information on these points. I would also strongly encourage other financial institutions and investment organizations to support startups entering the defense sector and to help strengthen Japan’s defense industry.
My second announcement is about my plan to visit Mitsubishi Heavy Industries (MHI) and PRODRONE in Aichi Prefecture tomorrow, May 20. During these visits, I plan to receive briefings on their on-site initiatives and observe their facilities and manufacturing conditions. U.S. Ambassador George Glass is also scheduled to accompany me during the visit to MHI. One of the objectives of the visit to MHI is to accelerate Japan-U.S. consideration of concrete measures to help strengthen production capacity for the enhanced capability type Patriot missile PAC-3 MSE. Amid the increasingly severe security environment, it is important for Japan and the United States to promote defense industry cooperation in order to mutually complement and strengthen our supply chains as well as our development, production, and maintenance and sustainment bases. I believe this visit will provide an excellent opportunity to deepen cooperation between our two countries. I understand that PRODRONE has developed and manufactured aircraft that have obtained Class II certification under Japan’s Civil Aeronautics Act, and that the company is pursuing advanced initiatives in the field of unmanned aerial vehicles, including efforts to obtain Class I certification, which would enable so-called Level 4 flight, meaning beyond visual-line-of-sight flight over inhabited areas without on-site assistants. As for myself, in today’s world of unmanned aircraft, where the rapid innovation cycle is moving at extraordinary speed, I hope to hear frank views from those working on the front lines of the defense industry regarding the challenges they perceive in helping Japan catch up and transform to have a structure that leads the world in leveraging unmanned assets. This concludes my two announcements at the outset.