Japan has decided to eventually discontinue the "Cool Japan" initiative, a project it has pursued with great ambition to promote the charm of its pop and traditional culture to the world.

Amid the global craze for Hallyu, or the Korean wave, the project has failed to produce clear business results. With low investment returns leading to a snowballing accumulated deficit, the government has ultimately decided to halt budget allocations.

According to the Asahi Shimbun, Mainichi Shimbun, and other media outlets today (August 21), Japan's Ministry of Economy, Trade and Industry (METI) has decided to abolish the public-private fund known as the Cool Japan Fund, officially called the Overseas Demand Development Support Corporation, and plans to exclude the project from the fiscal 2027 fiscal investment and loan plan.

The Cool Japan initiative aims to promote Japanese manga, anime, games, films, music, cuisine, fashion, traditional culture, and tourism abroad to boost exports of agricultural and fishery products, increase inbound tourism, and spread traditional Japanese culture globally.

The initiative was ambitiously launched in 2010 under the administration of then-Prime Minister Shinzo Abe.

While it was known to have benchmarked the Korean wave, the Japanese government has stated that it was influenced by the "Cool Britannia" policy implemented during the era of British Prime Minister Tony Blair.

The Japanese government launched the Cool Japan Fund in 2013 to serve as the command center and began implementing the project in earnest, but it has struggled as it continuously failed to recover investment funds from the projects it backed.

The root cause was the lack of active monetization in the invested projects.

The accumulated deficit swelled to 54 billion yen (approx. 477.9 billion KRW) by last year.

Regarding the sluggish performance, many point out that the policy was flawed from its inception.

The Asahi Shimbun quoted a METI official as saying, "Policy performance and profitability contradicted each other from the start. Projects with potential for profit were already held by the private sector, so monetization was impossible from the beginning."

As the discontinuation of the project increases the risk that invested funds will not be recovered, controversies over responsibility for the policy failure are expected to unfold.

The Asahi Shimbun explained that there were many skeptical views regarding the state's deep involvement in promoting the content industry, and that the Cool Japan project ultimately became a symbol of failure for state-led content support, saddled with massive losses.

It also criticized that amid an ambiguous situation regarding who should take responsibility, rushing to wrap up the project is drawing criticism for allegedly trying to turn the public's attention away.

The discontinuation of the project also deals a blow to Prime Minister Sanae Takaichi's content support policies.

The Takaichi administration regards the content industry as a "core industry," designating content alongside artificial intelligence (AI) and semiconductors as one of "17 strategic fields."

Meanwhile, METI allocated 7.7 trillion yen (approx. 68.1388 trillion KRW) the previous day for its ministry-level budget request for the upcoming year.

This is a 2.5-fold increase compared to this year's budget, with respective allocations of 1.4 trillion yen (approx. 12.3889 trillion KRW) for physical AI and robotics, 680 billion yen (approx. 6.0175 trillion KRW) for securing critical minerals, 220 billion yen (approx. 1.9468 trillion KRW) for diversifying raw material procurement such as naphtha, and 900 billion yen (approx. 7.9643 trillion KRW) for supporting small and medium-sized enterprises.

(Photo: Yonhap News)