JAXA Establishes ¥10 Billion Fund to Propel Space Industry Growth

05 Sep, 2023

JAXA Establishes ¥10 Billion Fund to Propel Space Industry Growth

The Japanese government is planning to provide a substantial subsidy of approximately ¥10 billion to the Japan Aerospace Exploration Agency (JAXA) in the fiscal year 2024. This funding is earmarked to support companies and universities involved in space development initiatives. Simultaneously, the government intends to amend the legislation governing JAXA, enabling more extensive and long-term financial backing to invigorate the burgeoning domestic space industry.

This initiative will involve collaborative efforts between the Cabinet Office and three ministries: the Ministry of Education, Culture, Sports, Science and Technology; the Ministry of Economy, Trade, and Industry; and the Ministry of Internal Affairs and Communications. The allocation of these funds will be overseen by JAXA, which possesses substantial expertise in space-related technologies. Companies and universities engaged in the development of technologies related to satellites, rockets, and advanced lunar exploration will be the beneficiaries.

Internationally, entities like the United States National Aeronautics and Space Administration (NASA) have successfully provided space-related funding to academic and private sectors. Japan aims to have JAXA fulfill a similar role in nurturing its space industry.

Furthermore, the government plans to create a space technology strategy within the current fiscal year to outline clear priorities for technological advancements. JAXA will distribute the funding based on this strategic framework.

Reports indicate that the government intends to introduce a provision into the JAXA Law, the foundational legislation for JAXA, to establish a fund for long-term, substantial financial support to the private and academic sectors. A draft revision of this law is expected to be submitted during an extraordinary Diet session in the upcoming autumn.

In the past, JAXA has invested its own income generated from intellectual property and other sources into two private companies, with funding limits in the tens of millions of yen. In March, the Liberal Democratic Party proposed the establishment of a ¥1 trillion fund over a decade.

Globally, space technologies are being widely adopted, notably in the form of satellite constellations where small satellites collaborate as a system. The United States has witnessed a surge in space startups, exemplified by SpaceX, with support from NASA and other organizations. One prominent U.S. financial institution predicts that the global space-related market will exceed ¥100 trillion by 2040.

In Japan's Basic Plan on Space Policy, approved by the Cabinet in June, the government has set an ambitious goal of expanding the domestic space market to ¥8 trillion in the 2030s, doubling its current size.