The OFREMI was established to inform the decisions of public authorities and industrial sectors across strategic value chains requiring a stable supply of strategic minerals and metals. Specifically, it assesses the industrial importance of each resource and its supply instability. Furthermore, through detailed analysis of supply chains, it identifies vulnerable areas and formulates mitigation strategies. Close cooperation between industry and government is essential to succeed, as well as exchanges within European (CRM Act), international (IEA, G7…) and bilateral (DERA, JOGMEC…) frameworks. While such actions incur costs, the economic losses from supply disruptions if no action is taken would be enormous.

Germany is a leading industrial nation and thus one of the major consumers of energy and mineral raw materials, especially for metals and many industrial minerals. Germany is highly dependent on raw material imports, and any disruption could halt industrial activity. To prepare for this, it has collaborated with a supply chain risk management company to build a real-time monitoring system that tracks the operational status of mines and refineries worldwide. This mechanism can provide rapid alerts to industry and government when events occur that could impact supply or prices. Drawing on initiatives like JOGMEC, we aim to further strengthen this framework going forward.

Securing a stable supply of raw materials is a challenge for our business.

Therefore, we are diversifying our suppliers through various methods, such as purchasing cobalt and lithium directly for our current battery generation. Furthermore, in addition to supply reliability, we also prioritize price competitiveness and consideration for Environmental, Social, and Governance (ESG) as key issues in procurement. However, these three points are often in conflict. We aim to pursue the optimal balance.

The OFREMI was established to inform the decisions of public authorities and industrial sectors across strategic value chains requiring a stable supply of strategic minerals and metals. Specifically, it assesses the industrial importance of each resource and its supply instability. Furthermore, through detailed analysis of supply chains, it identifies vulnerable areas and formulates mitigation strategies. Close cooperation between industry and government is essential to succeed, as well as exchanges within European (CRM Act), international (IEA, G7…) and bilateral (DERA, JOGMEC…) frameworks. While such actions incur costs, the economic losses from supply disruptions if no action is taken would be enormous.

Following the presentations by the three speakers, a discussion was held and moderated by Mr. Hashimoto. Regarding current challenges, Mr. Bourg asserted that supply chains will not return to their previous stable state for the foreseeable future. “Corporate and government officials must understand that risks are always present and respond accordingly,” he stated, emphasizing the importance of public-private collaboration in addressing these issues.

Mr. Weimer noted the significant presence of small and medium-sized enterprises (SMEs) within supply chains. He pointed out that it is challenging for SMEs to manage raw material procurement risks while also meeting ESG requirements, arguing that “the entire industry must work to ensure supply chain security.”

Mr. Al Barazi touched on investments in mines to secure mineral resources, mentioning the potential for joint German-Japanese initiatives. “Germany and Japan each possess specialized expertise. How we combine the insights of both countries is crucial,” he stated. Finally, all panelists confirmed the importance of Japan-EU cooperation, concluding the discussion.

Supply chains have experienced significant disruptions in recent years. Granular data is essential for identifying vulnerabilities and deriving policy insights. Detailed data on firm-to-firm transactions (e.g., customs records and Tokyo Shoko Research (TSR) data) as well as maritime logistics are now increasingly available. Leveraging these data, economic research on supply chains — addressing nature-driven disruptions, trade frictions and geopolitical conflicts — has advanced. This research highlights the importance of flexibly reorganizing supply chains after disruptions. Given economic security concerns, it is important to establish an institutional framework that integrates granular supply chain data, conducts rigorous, research-driven analysis of emerging risks and prepares for sudden policy demands.

In Germany, which had long been dependent on Russian natural gas, the risk of supply disruption became a reality after Russia’s invasion of Ukraine, raising concerns about severe impacts on industry. However, available data was coarse, making it difficult to predict short-term effects and ripple effects. Therefore, I collaborated with the government and statistical agencies to collect more granular data. We identified the industrial products with the highest gas consumption and gas intensity (output per unit gas) and further examined the potential of import substitution. The results demonstrated that product-level data combined with this methodology is effective for conducting rapid and precise analysis of economic impacts and informing policy decisions during crises.

In the discussion moderated by Dr. Ito, Dr. Bown first commented on both presentations.　He praised the methodology for analyzing supply chain vulnerabilities at granular levels such as products and industries, but requested that “analysis should be conducted in real time and used directly for policy formation, rather than retrospectively examining the impact of supply disruptions after the fact.” He further urged that “If stockpiling critical minerals is necessary, we need concrete details on where, how much and in what form they should be stored.”

In response, Dr. Kawakubo stated that the comprehensive think tank on economic security, currently under consideration, is expected to integrate data and conduct real-time analysis grounded in academic research. Meanwhile, Dr. Mueller pointed out that excessive government intervention undermines corporate responsibility and incentives, stating that “The private sector should be the main actor in countermeasures, while the government should limit itself to monitoring possible external effects on economic security and improving the policy environment.”

There are two approaches to supply chain analysis: the “company-based” method, which focuses on a single firm and traces purchasing and sales relationships, and the “industry-based” approach, which uses input-output tables to survey the structure of an entire industry. The company-based approach allows for analysis at the product level, but comprehensively tracking all suppliers is difficult. Conversely, while the industry-based approach is less effective at pinpointing specific products, it can identify vulnerabilities. For example, even if the source country for importing a certain active pharmaceutical ingredient for an antibiotic is India, the raw materials for that active pharmaceutical ingredient may actually be produced in China. This perspective is essential for economic security.

China is gaining control over the supply chain for critical minerals and rare earths — essential raw materials for semiconductors and batteries — by combining overseas investment with refining capacity. Consequently, while industrial modernization has advanced in mineral-supplying countries like Indonesia, breaking free from dependence on China has become increasingly difficult. This is in effect the “weaponization” of critical minerals. Policymakers in each country should heighten vigilance against such asymmetric dependencies. To further link concerns about China’s dominance in global critical mineral supply chains to national security concerns, we must secure stable supplies of drone battery materials in Taiwan. Cooperation between Taiwan and like‑minded partners is essential for our success.

Amid heightened geopolitical risks arising from conflicts, tariffs and disruptions in logistics, “economic geography simulation” is drawing attention. This methodology offers three key advantages: 1) it visualizes theoretical predictions as quantifiable data, 2) it enables comparative analysis of damage and policy effects and 3) it delivers rapid results. By utilizing this approach, immediate analysis of the impacts of sudden events can be undertaken on various countries, providing guidance on their severity and identifying alternative candidate locations for supply chain restructuring.

In the discussion chaired by Mr. Tamura, Dr. Kim posed questions to the presenters. Dr. Kim agreed with Dr. Baldwin’s view that U.S.-led decoupling between the United States and China is difficult. He asked, “Then how should the United States confront China?” Dr. Baldwin responded, “Reduce dependence on China in key industries. There is no other option at present.” Meanwhile, in the context of escaping asymmetric dependence on China, Ms. Glowacki commented on how Taiwan should act, “It should develop sources for procuring critical minerals through investment in third countries. The structure of the supply chain should be changed.”

Dr. Kim also agreed with Mr. Isono’s view that “retaliatory tariffs negatively affect both sides,” but pointed out that the perspective of interest rates and exchange rates was missing. Acknowledging this, Mr. Isono stated, “If companies do not pass tariffs on to prices, their capacity for investment and wage increases is squeezed.” He expressed the view that, in the long term, this would lower productivity and growth rates.

China is strengthening its position in large language models (LLMs), while simultaneously imposing regulations that require domestically developed models to conform to state-defined political values. Prior studies show that these constraints shape model behavior: when tested with 300 politically sensitive questions, Chinese LLMs refused or avoided answering in roughly 40% of cases. In Japan, derivative models based on open-source Chinese LLMs are increasingly being developed, and some appear to inherit aspects of these political response patterns. This underscores the importance of careful and application-specific evaluation of derivative LLMs.

China strategically controls raw materials and intermediate goods such as rare earths, chemicals and semiconductor materials, using them as instruments of military and economic pressure. If a Taiwan contingency should become reality with a maritime blockade imposed around Taiwan, semiconductor production there would come to a halt, and the impacts would ripple throughout the global economy. To prevent such a scenario, it is essential for allied nations to pool their strengths — Japan in components and manufacturing equipment, the United States in software, and the Netherlands in semiconductor lithography equipment — and work together to rebuild their economic deterrence.

Dr. Bristow stated that Dr. Ito’s presentation left him with the impression that “the United States’ advantage in the AI field won’t last long.” He further expressed concern about China using AI as a means of propaganda.

Regarding Dr. Teer, he suggested that “what China is attempting against Taiwan is not an invasion, but coercion.” On the other hand, he pointed out that in the event of a crisis in Taiwan, the Taiwanese side “could also have the option of intentionally halting semiconductor production to draw global attention and internationalize the issue.”

Dr. Bristow further emphasized that Australia was able to withstand the economic pressure from China because “the open international trading system worked.” He stressed the need to build reliable supply chains among allies.

Finally, Dr. Baldwin concluded the discussion by stating, “Although we did not reach an optimistic conclusion, we gained extremely important insights.”