Policy Updates

On August 8, 2025, the JICA determined the issuance conditions for two "Africa-TICAD Bonds" totaling JPY23 billion (US$155 million) to finance development projects in Africa, coinciding with the 9^th TICAD.

The non-guaranteed Sustainability Bonds will be issued in two tranches: one of JPY15 billion (US$101 million) with a three-year maturity and another of JPY8 billion (US$54 million) with a five-year maturity.

The net proceeds are slated to support new or ongoing eligible projects within the JICA's Finance and Investment operations, as defined by the JICA Social/Sustainability Bond Framework. Funding will not be allocated to activities related to coal-fired thermal power projects. The initiative aims to mobilize private finance and support Africa's independent and sustainable growth.

On August 4, 2025, JICA announced a US$6 million loan agreement with Thu Dau Mot Water Joint Stock Company to expand the Bau Bang Water Supply System in Vietnam.

The loan, co-financed by the ADB, will fund the construction of a new water treatment plant and an associated pipeline. The project aims to improve the urban sanitation environment and support sustainable economic growth in Bau Bang Hamlet, Ho Chi Minh City. The initiative contributes to SDG 6 (Clean water and sanitation) and 17 (Partnerships for the goals).

On July 31, 2025, JICA held a signing ceremony for a US$90 million loan to HDBank to support Vietnam's agricultural sector.

The loan is co-financed with FinDev Canada and SMBC. The project aims to improve access to finance in Vietnam's agricultural sector by providing long-term loans through the bank, thereby contributing to the expansion of agricultural production and income.

The project is the second under the SMBC- JICA Sustainable Finance Framework and is also part of SAFE. The initiative contributes to SDG # 1, SDG # 2, and SDG # 8.

On July 20, 2025, LDP and coalition partner Komeito lost their upper house majority in the House of Councillors recent elections, intensifying pressure on the minority government.

Opposition parties gained seats by promising tax cuts and welfare spending, resonating with voters frustrated by rising consumer prices, especially the cost of rice. The center-left CDP now held 37 seats, and the center-right DPP had 22. The far-right SNT, which ran a "Japanese first" campaign, expanded its presence from one to 14 seats.

Despite this, Japanese Prime Minister Shigeru Ishiba of the vowed to stay on as leader, focusing on critical tariff negotiations with the US before the August 1, 2025, deadline. The result followed earlier losses in the lower house and longstanding unpopularity within the LDP.

On July 14-15, 2025, JICA signed grant agreements worth a total ofJPY3.2 billion (US$22 million), one agreement of JPY2.5 billion (US$17 million) to the Republic of Vanuatu, and an agreement with UNICEF for the Project for the Eradication of Poliomyelitis in Afghanistan JPY714 million (US$5 million).

The agreement with the Republic Of Vanuatu aims to rebuild key economic infrastructure affected by the earthquake, promote disaster-resilient socio-economic development by reconstructing the Tagabe Bridge, and provide maintenance equipment. The program is led by MIPU and the Ministry of Health. The initiative seeks to contribute to the SDGs, specifically, SDG 9 (industry, innovation, and infrastructure), SDG 11 (sustainable cities and communities), and SDG 13 (climate action).

The Project for the Eradication of Poliomyelitis in Afghanistan, supports vaccine procurement and technical assistance to help reduce polio among children, and advance SDG 3 (good health and well-being).

On July 11, 2025, JICA and the UNDP hosted a two-day demonstration in Ukraine to showcase advanced technologies supporting humanitarian mine action, which was held in collaboration with the SESU and featured:

• ALIS, a Japanese-developed ground-penetrating radar system, presented by its inventor Prof. Motoyuki Sato;
• Heavy demining machinery donated by Japan through JICA; and
• AI -powered drone-based scanning developed by Ukrainian company UADamage

Participants included representatives from Ukraine’s Ministry of Economy, SESU, national mine action operators, and UNDP staff. The demonstration aimed to enhance local capacity and inform the operational deployment of new technologies.

UNDP Ukraine emphasized the importance of innovation in accelerating safe, effective demining, while JICA reiterated Japan’s commitment to supporting Ukraine’s humanitarian mine action.

On June 13, 2025, Japan signed a grant agreement with Sierra Leone providing US$20 million to expand electricity distribution infrastructure funding new substations, power lines, and transformers across the Western Area, aiming to improve access and reliability in underserved coastal communities.

The support, delivered through Japan’s Grant Aid program, builds on earlier energy collaboration and aligns with Sierra Leone’s goal of universal energy access.

On May 30, 2025, JICA signed the Development Policy Loan which provides JPY60 billion (US$393 million) with Bangladesh to support economic reforms and climate resilience, bolstering Bangladesh's economy amid global challenges like inflation and climate-induced disasters.

The 30-year loan, with a 2% annual interest rate and a 10-year grace period, aims to improve the business environment and governance, and implement climate measures. Co-financing includes US$600 million from the ADB and US$500 million from the World Bank.

Additionally, the Human Resource Development Scholarship Project grants JPY606 million (US$4million) to fund advanced degrees for young Bangladeshi officials in Japan, enhancing administrative capacity and bilateral ties.

On May 19, 2025, Japan committed US$17 million to support Ethiopia’s infectious disease control efforts through a bilateral agreement signed in Addis Ababa in which the funding will finance the construction and equipping of a specialized facility at St. Peter Hospital with advanced diagnostic and treatment technologies, enhancing Ethiopia’s capacity to manage infectious diseases.

The agreement, signed by Ethiopian Finance Minister Ahmed Shide and Japanese Ambassador Shibata Hironori, also prioritizes quality of care improvements, disease prevention, and capacity building. Shide described the initiative as a strategic investment in Ethiopia’s healthcare system, while Ambassador Hironori emphasized Japan’s commitment to Ethiopia’s development and global health contributions through platforms like GAVI and the Global Fund.

This collaboration underscores over a century of Ethiopia-Japan diplomatic relations and aligns with Japan’s broader efforts to strengthen Africa-Japan partnerships, including the upcoming TICAD 9 summit. The project aims to establish a center of excellence for infectious disease treatment, leveraging cutting-edge technology for efficient diagnosis and care.

On May 16, 2025, Japan announced an additional grant of JPY573 million (US$4 million) to Nepal for the improvement of the Dhulikhel Hospital Trauma and Emergency Center bringing Japan’s total grant for the project to JPY3.9 billion (US$25 million), the initiative aims to enhance Nepal’s healthcare infrastructure, improve medical service quality, and support economic growth and poverty reduction through strengthened medical care.

The grant addresses a shortage of medical equipment and beds in Nepal’s health facilities, exacerbated by rising trauma and emergency cases due to increased traffic and non-communicable diseases like stroke and heart disease. The project will construct a trauma and emergency center at Dhulikhel Hospital, a key medical hub near Kathmandu.

The agreement was signed in Kathmandu by Japanese Ambassador Maeda Toru and Nepal’s Finance Secretary Ghanshyam Upadhyaya, in the presence of Japanese Parliamentary Vice-Minister Ikuina Akiko and Nepal’s Deputy Prime Minister Bishnu Prasad Paudel.