U.S.-Japan $550B Pact advances as $36B energy tranche starts

• Lyla Velez
• February 18, 2026
• News
• 0 Comments

Key Points:

• Japan launches $36 billion tranche for U.S. energy and critical minerals.
• First deployment under $550 billion U.S.-Japan trade pact, Trump announces.
• Three Japan-financed projects begin, including an oil export facility.

President Donald Trump announced that Japan has begun investing in major U.S. energy and industrial projects, marking a $36 billion first tranche for U.S. energy and critical minerals. As reported by Bloomberg, this is the first deployment under a $550 billion U.S.-Japan trade pact.

According to Reuters, the administration identified three projects totaling $36 billion to be financed by Japan, including an oil export facility. Early allocations prioritize oil, gas, and critical mineral supply chains in the United States.

How this fits the $550 billion U.S.-Japan trade pact

The $550 billion U.S.-Japan trade pact is a broad framework aligning trade access and capital across energy, autos, AI infrastructure, agriculture, and industrial goods. Jefferies analysts, as reported by Investing.com, highlight potential tariff relief and a profit-sharing 90/10 split in favor of the U.S. after cost recovery as central to evaluating deal traction.

Policy experts caution that many terms remain undefined, including what qualifies as an eligible “investment,” how benefits are triggered, and how timelines will be enforced. Mireya Solís, senior fellow at the Brookings Institution, has warned there are no guarantees on realized investment levels given the framework’s vagueness.

Japanese business leaders emphasize predictability to sustain capital commitments. As reported by Kyodo News, Keidanren (Japan Business Federation) urged the United States to provide stable, transparent rules so companies can invest with confidence.

Direct investment about 1–2% of total, per Japan negotiators

Only a small share of the framework appears to be true equity capital. The Wall Street Journal reported that chief negotiator Ryosei Akazawa estimates direct investment at about 1–2% of the total, with most support delivered via the Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance (NEXI).

Akazawa also clarified how returns would be allocated, noting that profit sharing would be set “according to the degree of contribution and risk”, not a rigid formula across all projects. That suggests the oft-cited 90/10 split may vary by project and cost recovery.

This financing mix matters for governance, risk, and cash flows. Loans and guarantees from JBIC and NEXI can accelerate deployment while limiting equity control, and any headline split will likely be adjusted by cost recovery and risk allocation in practice.

What to watch next includes publication of formal documents, specific tariff schedules, and project-level financing disclosures, alongside U.S. permitting and policy decisions that shape timelines for energy and critical minerals. Investors and policymakers will also track the timing of the three initial projects announced by the administration.