In a strategic move to strengthen economic ties, Japanese Prime Minister Fumio Kishida has reached out to American business leaders, advocating for an uptick in technology investments within Japan.

What Happened: Kishida has made a pitch to American executives for greater investment in Japan’s technology sector, Bloomberg reported on Tuesday.

During a roundtable in Washington, Kishida highlighted the importance of U.S. investments in Japan, particularly in emerging technologies like semiconductors, AI, and quantum computing. He emphasized that such investments would bolster Japan’s economy and, in turn, lead to more Japanese investments in the U.S.

“I want to make this year a period when Japan can completely exit the mindset of deflation and cost cutting,” he said.

“I’m strongly promoting policies toward the next economic stage so that people, goods and money will get moving firmly.”

Notable attendees at the event included executives from International Business Machines Corp. IBM, Pfizer Inc. PFE, Boeing Co. BA, Micron Technology Inc. MU, and Western Digital Corp. WDC, among others.

The meeting precedes a summit with U.S. President Joe Biden, where economic cooperation between the two nations will be a key topic. Kishida cited Japan’s significant investment in the U.S., including job creation and collaborative efforts in semiconductor production.

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Japan’s economic landscape is changing, with recent interest rate hikes and stock market records. Kishida expressed his desire to move beyond deflation and cost-cutting mindsets, aiming to stimulate movement in people, goods, and capital.

Concerns over the US freeze on new liquefied natural gas export facilities were also discussed, given Japan’s heavy reliance on LNG imports. The U.S. Chamber of Commerce acknowledged the discussions on energy security and the importance of U.S. LNG exports to Japan and other allies.

Why It Matters: Japan has been positioning itself as a promising investment destination. UBS AG reinstated its equity strategist role for Japan after a seven-year hiatus, signaling a renewed interest in the Japanese market, with JP Morgan also recognizing the potential for a positive reassessment of Japanese equities.

More recently, in March, Silchester International Investors, known for its long-term silent investments, has become vocal about the need for financial reforms in Japan, indicating a shift in the investment climate and a call for change that Tokyo seems to be heeding.

Adding to the momentum, Microsoft Corp. announced a substantial $2.9 billion investment in data centers in Japan, marking a significant commitment to the country’s tech infrastructure.

Furthermore, the upcoming summit between President Joe Biden and Prime Minister Kishida is set to cover a range of economic collaborations, including a high-speed rail proposal for Texas using Japanese technology, showcasing the multifaceted nature of the US-Japan economic partnership.

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