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Japan’s GX Strategy: A Model for Climate Finance and Sustainability in Asia

Edition AIJapan's GX Strategy: A Model for Climate Finance and Sustainability in Asia

Japan’s Green Transformation: A Bold Vision

Japan’s GX Strategy, introduced in 2023 and updated in 2025, focuses on coordinating climate, energy, and industrial policies to achieve net-zero emissions by 2050. The strategy aims to drive economic growth, enhance industrial competitiveness, and ensure energy security.

Public-Private Partnerships

Japan implements a hybrid model for its GX Strategy, leveraging public-private partnerships to fund the transition to a low-carbon economy. This model, based on industrial policy, allocates substantial funds for non-fossil energy expansion, industrial restructuring, energy conservation, and technological innovation.

Financial Support for Decarbonization

Japan’s Ministry of Economy, Trade, and Industry (METI) offers financial support through programs such as the Sector-specific Investment Strategy and the Green Innovation Fund. These initiatives focus on areas like electric vehicles, energy storage, and offshore wind power.

Carbon Pricing Initiatives

Japan plans to introduce a growth-oriented carbon pricing system, including the GX Emissions Trading System. This system aims to decarbonize the economy and enhance the competitiveness of businesses through measures like carbon levies on fossil fuels and emissions rights auctions.

Role of Investors

Investors can play a crucial role in supporting Japan’s energy transition and leveraging new financial tools like Transition Bonds. The GX Strategy presents opportunities for investors in clean energy solutions and sustainable finance.

For more details and references, please refer to the Responsible Investment Pulse and the Amundi Research Center.


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