Japan’s natural resource diplomacy is no longer just about shielding domestic industries from supply shocks. Rather, it’s now actively co-architecting markets, shaping which technologies scale and where companies place their bets.

After decades of debating new ways to access critical minerals, Japan is starting to wield its institutional tools more assertively – making direct investments, underwriting high-risk ventures, and expanding state finance to influence global supply chains. This marks a shift from strategic intent to operational action.

Two recent deals illustrate this. JOGMEC backed a rare earth refinery in France – its first support for a stand-alone overseas processing facility. Meanwhile, the Japan Bank for International Cooperation (JBIC) committed $466 million to Chile’s state copper giant, Codelco, as part of a larger co-financing package to secure supplies for Japanese firms.

Such moves go beyond raw material access. They reflect Tokyo’s recognition that mineral security today means engaging across the value chain. What began in the 2010s as risk mitigation has matured into a state-enabled resource diplomacy ecosystem – one suited for an era of geopolitical fragmentation and technological chokepoints.

This is an excerpt from a guest piece by Dr. Parul Bakshi, who is a Visiting Researcher at the Institute for Future Initiatives at the University of Tokyo and a recipient of the Japan Foundation Indo-Pacific Partnership Fellowship.