Total Japanese investment in the United States under Japan-US relations is estimated at around ¥87 trillion, but the Democratic Party's drive to tighten regulations on AI data centers is likely to influence how the situation unfolds. Depending on the political scenario after the midterm elections, Japanese companies' investment plans could be affected.
Japanese investment in the United States under last year's Japan-US tariff agreement is expected to total approximately ¥87 trillion, but the Democratic Party's stance in favour of tighter regulation is expected to cast a shadow over the outlook for data center construction plans. The environment after the new Congress convenes next year is uncertain, and it has been noted that the terms of Japanese companies' investments could change depending on decisions by the US side.
Investment through the third tranche, for which execution has been decided to date, has reached approximately $130 billion (about ¥21 trillion), accounting for slightly more than 20% of the total. Minister of Economy, Trade and Industry Akazawa said the investment would not be immediately affected by the election results, but attention is focused on how future negotiations develop.
The rapid spread of AI is behind the Democratic Party's call for tighter regulation. Data centers face scrutiny over their large-scale consumption of electricity and water resources, and some have pointed out that they provide limited employment benefits. Tighter regulation of data centers has emerged as a key issue ahead of the midterm elections.
Specific examples of investment from Japan include SoftBank-led plans for a large-scale gas-fired power plant in Ohio, with an investment of approximately $33.3 billion (about ¥5.3 trillion), and a next-generation nuclear power development project in Tennessee and Alabama involving Hitachi, with an investment of up to approximately $40 billion (about ¥6.3 trillion). These projects are intended to supply power to data centers.