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yesterday

Japan Confirms 10/90 Profit Split in $550 Billion U.S. Investment Pact

Governance structures for the pact remain undefined.

Japanese and U.S. Flags fly side by side outside the White House in Washington, U.S., April 5, 2024. REUTERS/Kevin Lamarque/ File Photo
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Data: Bureau of Economic Analysis; Chart: Axios Visuals

Overview

  • Japan’s government announced returns on the $550 billion investment will be allocated 10% to Japan and 90% to the United States based on each side’s contribution and risk.
  • State-owned Japan Bank for International Cooperation and Nippon Export and Investment Insurance will provide loans and guarantees to back Japanese firms’ projects.
  • President Trump will direct funds toward revitalizing U.S. industries such as energy infrastructure, semiconductor manufacturing, critical minerals, pharmaceuticals and shipbuilding.
  • Key legal entities, governance frameworks and incentives for Japanese participants have yet to be specified, prompting calls for greater clarity.
  • The pact pairs a 15% reciprocal tariff framework with the investment commitment as part of Washington’s strategy to leverage tariffs for market access and funding pledges.