February 29

Part 1: US-China competition and the Indo-Pacific (2) Economic security

The session began with a discussion on what "economic security" means, and the positions of the individual speakers highlighted the differences in thinking.

US participants were of the view that the scope of economic security should be limited but essential, given that the US pursues policies that include both defensive measures such as export controls and investment screening and offensive measures such as industrial policies aimed at strengthening technology and the economy. Japanese participants said that they were integrating economic security into their national security strategy, taking measures to protect critical supply chains and technologies, strengthening cooperation with the private sector, and pursuing international cooperation with allies and like-minded states. At the same time, they noted that the free trade regime and market economies are vital to Japan and that a collapse of these would constitute a serious threat. Chinese participants expressed the need for international cooperation to address global challenges such as climate change and stressed the importance of comprehensive dialogue through various regional frameworks, cautioning that an overemphasis on security risks leading to a disruption of economic activities should be avoided. The vital role of cybersecurity in economic security was also emphasized during the discussion, and the significant impact of cyber threats on economic activities and national security was pointed out.

The positive aspects of economic security measures on economic growth were then taken up for discussion. It was observed that technology is a double-edged sword: a driver of economic growth and a potential security threat. It was also noted that investments in infrastructure, critical manufacturing, and clean energy could serve as potential foundations for economic growth and security. While the benefits of globalization and the importance of an inclusive international economy were affirmed, the need for a balanced approach to managing risk was also emphasized.

Measures to pave the way for sound economic security were also addressed. First, the need for states to engage in dialogue to better understand each other’s risk perceptions and the extent to which investments in security should be undertaken was emphasized. While the necessity of a stable and predictable international economic order was stressed, attention was also drawn to the US’s skeptical attitude toward international economic rulemaking. On the importance of cyber security defense, the challenges faced by small and medium-sized enterprises in protecting their businesses from cyber threats were noted.

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