Japanese Prime Minister Sanae Takaichi speaks during a press conference after the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju, South Korea, November 1, 2025. REUTERS/Kim Hong-ji

By Makiko Yamazaki and Kentaro Sugiyama

TOKYO (Reuters) -Japanese Prime Minister Sanae Takaichi's government launched its economic strategy headquarters on Tuesday, aiming to boost the world's fourth-largest economy with public investment focused on critical sectors such as chips and defence.

Takaichi convened the headquarters' inaugural meeting on Tuesday, a policy command centre aimed at revitalising the country's industrial base with targeted government investment.

"Under our principle of responsible and proactive fiscal policy, we will carry out strategic fiscal spending," Takaichi said at the meeting.

"Our goal is to strengthen the supply structure of the Japanese economy, increase income, improve consumer sentiment, boost corporate earnings, and ultimately raise tax revenue without increasing tax rates," she added.

The government has not detailed a funding plan or value for the intiative.

A total of 17 industrial sectors were designated for focused investments, including artificial intelligence, semiconductors, shipbuilding, aerospace and defence.

At the meeting, the government also approved the creation of an advisory panel which includes private-sector experts.

Among 12 experts appointed for the panel are two renowned proponents of reflationary policies - Credit Agricole chief Japan economist Takuji Aida, and former central bank board member Goushi Kataoka, who is currently chief economist at PwC Consulting.

The headquarters would be Takaichi's key policy platform to build a strong economy backed by targeted investment, replacing former Prime Minister Fumio Kishida's "new capitalism" programme of driving growth and wealth distribution through wage hikes.

Takaichi asked ministers in charge of the designated sectors to come up with public-private investment roadmaps, outlining the content, timing and target amounts of investments. Based on the roadmaps, the government will compile a new growth strategy by the summer, she said.

(Reporting by Makiko Yamazaki, Kentaro Sugiyama and Kantaro Komiya; Editing by Tom Hogue and Lincoln Feast.)