NPI and KAS Co-host Special Seminar on February 20, 2024
Keynote Speech by NPI Chairman Aso Taro
“Economic Security: A German Perspective”(Summary)
Aso Taro
ChairmanNakasone Peace InstituteIn the “National Security Strategy” announced in October 2022, the United States positioned Chinaas the only competitor with both the intention to reshape the international order and capacity to do it
and placed the highest priority on countering China not only militarily and diplomatically but also
economically. Based on this context, economic security is also often discussed in terms of “U.S.
versus China.”
However, if the focus of this U.S.-China rivalry is on whether or not to defend the “existing rulesbased international order” and a “free, open, prosperous, and secure world,” then, of course, nations
other than the United States and China cannot afford to remain indifferent.
If we look at the world today, it is divided into three categories: authoritarian states like China andRussia, countries like Japan where freedom and democracy are fundamental values, and the so-called
Global South.
In this context, the coordination among democracies, which are in fact a minority, as well as theircoordination and cooperation with the Global South, is an important issue in the pursuit of global
stability and prosperity.
From Japan’s point of view, it is essential to coordinate and cooperate not only with the U.S. but
also with the EU and Germany, which leads the EU.
In June 2023, the EU published its first “European Economic Security Strategy” as a common
framework to ensure economic security.
With proportionality and accuracy as fundamental principles, the framework will promotestrengthening the economic infrastructure and competitiveness, increase defenses against risk, andwork with the widest possible range of countries to address common concerns and interests.
In addition, in October 2023, the EU formally adopted a regulation known as the Anti-Coercion
Instrument (ACI), which allows for countermeasures against “economic coercion” by countries
outside the EU region against the EU and its member states.
In Germany, as well, the government formulated and announced its first-ever policy toward China
in July 2023. Referring to China’s attempts to reconstruct the existing rules-based international order1and to achieve its political objectives in the international community through the use of economic
power, we understand that the policy clearly states that China has changed and that Germany needs
to change its approach and change its course.
Whether in the EU or in Germany, the common basic perspective on economic security is not“decoupling,” which means division, but “derisking,” which means risk reduction or risk avoidance.
This is not just a play on words or a paraphrase.
Although the derisking strategy is sometimes understood as the antithesis of harmful policies suchas the economic blocs of the past, its specific policy content is basically a combination of “industrialpolicies to strengthen strategic industries,” “establishment of secure and resilient supply chains,” and“regulations to prevent increased security risks due to technology outflows.” The derisking strategy
can be said to be formulated through policy coordination with allies and like-minded countries andby expanding the number of partners with whom to coordinate and cooperate to increase effectiveness.
This basic policy of derisking that emerged from Europe was shared at the G7 Hiroshima Summitin May 2023.
These developments mean that coordination and cooperation among allies and like-mindedcountries, and outreach to the Global South, are of increasing importance.
In particular, Japan and Germany are both G7 members, and in terms of trade, Germany is Japan’slargest trading partner in the EU, while Japan is Germany’s second largest trading partner in Asia.
According to the International Monetary Fund (IMF), Japan was overtaken by Germany in grossdomestic product (GDP) size in FY2023, partly due to recent exchange rate problems, but in any case,the two countries have the third and fourth largest GDPs in the world.
As major powers, the two countries must take on the responsibility of promoting coordination toensure stability and prosperity for the world as a whole. In the face of the international political andeconomic reality that we cannot proceed with a free economy alone, I think it is fair to say that how
the two countries coordinate with each other in terms of economic security is of great importance tothe international community overall.
Well, year 2024 is a year of elections. I am not talking about Japan. The U.S. presidential election
will be held in November 2024.
As the world’s number one economy, the United States, whether led by the Democratic Party or
Republican Party, is united on its policy toward China.
However, it is undeniable that the extent to which the government will push forward not only its
policy toward China but also its broader economic security policies will depend on the outcome ofthe election.
Already, various assertions are being heard during the election campaign, as you may be aware.
Some of them are surprising while others may cause concern due to their potential serious
repercussions.
However, from the basic standpoint of derisking in terms of economic security, it is obvious that
our coordination, cooperation, and partnership among allies and like-minded countries, including2

with the United States, are extremely important and must not be allowed to be disrupted.
I believe that there may come a time in the future when Japan will need to play a coordinating role
among allies and like-minded countries in collaboration with the EU and Germany, which leads theEU.
From this perspective as well, I also consider it important for Japan and Germany, as major powersthat share the same values, to collaborate and cooperate.

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