Japan’s top state-backed investor has warned that blocking a $47 billion foreign acquisition of 7-Eleven owner Seven & i Holdings could damage the country’s international reputation and its push to attract foreign capital.

In an interview with Reuters on 28 March, Japan Investment Corporation (JIC) CEO Keisuke Yokoo expressed concern over growing calls to reject Canadian firm Alimentation Couche-Tard’s bid for the retail giant on economic security grounds. Couche-Tard, the owner of Circle K, announced its offer last August but has faced cold reception and political scrutiny in Tokyo.

"It wouldn't be good for Japan's image," Yokoo told Reuters, adding, "It's hard to see how the retail business is connected to economic security." His remarks came amid speculation that the Japanese government could block the deal, citing the classification of Seven & i as “core” to national security, due to its diverse operations including financial services.

While JIC is not involved in the 7-Eleven acquisition, Yokoo’s statements highlight a broader concern within Japan’s financial establishment about appearing overly protectionist at a time when the country is trying to reverse its reputation as unfriendly to foreign investment.

The government fund, which was launched in 2018 to bolster Japan’s industrial competitiveness, operates under the Ministry of Economy, Trade and Industry and champions the concept of “economic metabolism” — a policy emphasizing that outdated firms must give way to stronger players through strategic consolidation.

One key area of focus for the fund is Japan’s chemicals industry, particularly suppliers to the global semiconductor sector. Yokoo pointed out that despite losing its edge in chip manufacturing, Japan continues to dominate high-end materials critical to chip production.

Citing JSR — the top photoresist maker JIC bought out for $6 billion last year — Yokoo said the chemicals sector should undergo more consolidation to improve its global footprint. “We need to make them fewer in number and bigger in size,” he said.

JSR’s newly installed CEO recently promised to revitalize the firm after a rough patch in its life sciences division. Yokoo expects a minimum return of 1.5 times on the investment.

As for potential new investments, Yokoo ruled out aiding troubled automaker Nissan — at least for now. “We’re prepared to provide equity for strengthening Japan’s competitiveness,” he said, “but not for rehabilitation.”

He added: “I’d be interested in talking once they manage to turn themselves around.”

Yokoo’s comments may signal that even within government circles, there is caution against using economic security as a pretext for blocking deals that could bring strategic capital into Japan — especially from established allies.

As countries like the U.S. ramp up protectionist trade policies, Japan’s balancing act between economic nationalism and global investment openness is under closer scrutiny than ever.