Nikkei: Japan and Taiwan Sow Seeds of Drone Cooperation to Address China's Supply Chain Challenges

（Central News Agency, Taichung, May 10, comprehensive foreign report） "Nikkei Asia" reported today that Japan and Taiwan are both facing challenges in reducing China's dominant position and cost advantages in supply chains. In this context, cooperation between Japan and Taiwan in the drone sector is gradually emerging.

The report points out that Japan is promoting the strengthening of regional security partnerships and easing decades-old restrictions on weapon exports; Taiwan is actively seeking to enhance supply chain cooperation opportunities. China's massive military expansion and the implementation of export control measures make such actions by Japan and Taiwan more urgent.

Deng Hongyuan, a policy analyst at the Taiwan Science, Democracy, and Society Research Center (DSET), a Taiwanese think tank, stated: "China's recent export controls on dual-use items to Japan, including restrictions on large enterprises like Mitsubishi Heavy Industries and Kawasaki Heavy Industries, may test Japan's drone development, especially components like batteries and motors that rely on China's rare earths."

Currently, Japan-Taiwan drone cooperation is mainly driven by the industry. DSET analysis indicates that since 2020, 15 agreements have been signed by companies, industry groups, research institutions, and other related parties from both sides.

Signatories include the "Taiwan Excellent UAV Overseas Business Alliance" established by Taiwan's Ministry of Economic Affairs, the Industrial Technology Research Institute (ITRI), and Japan's two major drone alliances—the "Japan UAV Industry Promotion Association (JUIDA)" and the "Japan Drone Consortium (JDC)." Key areas covered include supply chain and technology development, disaster prevention, emergency response, autonomous flight testing, and application deployment.

Chiayi's "7A Drones" (新樂飛無人機) and its Japanese partners signed two of the latest agreements. One is with AlterSky to develop large logistics drones; the other is with Autonomy HD to integrate Japan-Taiwan drone industry supply chains and develop next-generation autonomous drones.

Japan is Taiwan's most important security and political partner after the United States. In the past year, Taiwan's Foreign Minister Joseph Wu and Premier Cho Jung-tai both visited Japan on private itineraries, marking the first known instances since the break in diplomatic relations in 1972.

Furthermore, Japanese Prime Minister Sanae Takaichi stated in the Diet in November last year that if a "Taiwan contingency" (emergency situation in Taiwan) accompanied by the use of force were to occur, it could constitute an "existential crisis" (存立危機事態) under Japan's security legislation, allowing Japan to exercise collective self-defense, which sparked a significant dispute with Beijing.

Despite this, Deng Hongyuan, citing Japanese customs statistics, pointed out that China remains the primary supplier to Japan's civilian drone market. Last year alone, Japan imported 124,936 drones from China, accounting for over 90% of the Japanese market share.

To change this situation and enhance supply chain resilience, Japan's Ministry of Economy, Trade and Industry (METI) announced a plan last September to produce 80,000 Japan-made drones by the end of 2030. The plan emphasizes cooperation with "like-minded nations" on critical components such as motors, batteries, communication modules, and flight controllers.

Deng Hongyuan told Nikkei Asia: "In this context, Taiwan's demonstrated reliability and production strength in drone motors and batteries in Ukraine and Eastern Europe, coupled with Taiwan's cost competitiveness in 'non-red' supply chains, makes it a suitable partner to help Japan secure a stable supply of critical components for domestically produced drones."

Katsuya Yamamoto, Director of the Strategy and Deterrence Group at the Sasakawa Peace Foundation (SPF), a Tokyo think tank, also noted significant growth in civil drone applications in both Japan and Taiwan.

He believes there is immense potential for rapidly deepening cooperation between Japanese and Taiwanese private enterprises, while also emphasizing that such cooperation would begin at the civilian level rather than the government level, and anticipates that it could eventually open the door to "dual-use sector" cooperation.

However, there is still a long way to go before that. DSET estimates that last year, Taiwan exported only 45 drones to Japan, while Japan exported only 3 to Taiwan. On the other hand, Taiwan shipped over 120,000 drones to countries such as Poland, the Czech Republic, and the United States.

Deng Hongyuan explained that Taiwan's current drone cooperation model typically includes: exporting low-cost small drones to Central and Eastern Europe to support Ukraine against Russia; exporting components to Europe and the United States to replace Chinese products; participating in US federal and local government drone tenders; and collaborating with foreign companies to bid for Taiwan government procurement projects.

He stated that these partner nations already possess a certain level of production capacity, procurement scale, and technological ecosystem. However, due to Japan's long-standing lag in mass production capabilities and its failure to establish a large-scale industrial ecosystem, it is difficult for Taiwanese companies to find suitable partners in Japan for technical cooperation, component supply, or joint participation in government tenders.

On the other hand, regarding Japan's recent easing of weapon export restrictions, Katsuya Yamamoto believes that it will not directly accelerate the deepening of Japan-Taiwan cooperation in weapons or defense equipment in the short term, as it still takes time to finalize agreements similar to those Japan has reached with the UK, Australia, and the Philippines.

However, an anonymous senior foreign defense industry leader told Nikkei Asia that the significant shift in Japan's defense export policy should gradually influence Taiwan, and in the future, we may see sub-systems for dual-use platforms provided to Taiwan's defense industry, but it is highly unlikely that Japan will provide ships or aircraft to Taiwan's armed forces.

As for drone systems, he believes that both Japan and Taiwan may prefer to promote cooperation through non-governmental organizations (NGOs) and industry associations, rather than direct government-to-government negotiations.