New Developments in Asia-Pacific Foundry Industry Policies: Reshaping Industry Landscape through Policy Adjustments in the Second Half of 2026

New Developments in Asia-Pacific Foundry Industry Policies: Reshaping Industry Landscape through Policy Adjustments in the Second Half of 2026

In the second half of 2026, the Asia-Pacific foundry industry is experiencing a new wave of policy adjustments. With the acceleration of global supply chain restructuring, deepening green transformation, and changes in the geopolitical landscape, governments have successively introduced supportive or regulatory policies for the foundry industry. These policy adjustments are profoundly influencing the regional foundry industry landscape, technological development direction, and investment flows. This article will comprehensively analyze the new developments in foundry industry policies of major Asia-Pacific economies and their reshaping effects on the industry ecosystem, providing forward-looking insights for investors.

China's Foundry Industry Policy Adjustments: Dual Carbon Goals Leading Industrial Upgrading

In the third quarter of 2026, China's Ministry of Industry and Information Technology released the "Mid-term Evaluation and Adjustment Plan of the 14th Five-Year Development Plan for the Foundry Industry," explicitly proposing a quantitative target to reduce carbon emission intensity in the foundry industry by 25% by 2027 compared to 2020. This policy orientation has prompted Chinese foundry enterprises to accelerate green transformation, promoting foundry processes toward low-carbon and efficient development.

Policy adjustments are mainly reflected in three aspects: first, increasing financial support for green foundry technologies, establishing special funds to support enterprises in implementing energy-saving transformations; second, raising industry access thresholds, strictly limiting the addition of new capacity for high-energy consumption and high-emission foundry projects; third, encouraging the cluster development of the foundry industry, supporting the construction of a number of green foundry demonstration parks.

These policy adjustments have had a profound impact on China's foundry industry. On one hand, they have accelerated the elimination of backward production capacity. It is expected that by the end of 2026, China will shut down more than 200 non-compliant foundry enterprises, accounting for about 8% of the total. On the other hand, they have promoted the industry toward high-end and intelligent development. The application ratio of advanced technologies such as precision casting and 3D printing casting is expected to increase from 15% in 2023 to 30% in 2026.

From an investment perspective, China's foundry industry policy adjustments have created new investment opportunities. Green foundry technology equipment, intelligent production lines, and high-end foundry materials will receive policy dividends, and valuations of related enterprises are expected to be revalued. According to industry analysis, from the second half of 2026 to 2027, China's green foundry market size is expected to grow by more than 25%, with an annual compound growth rate maintained at around 20%.

Japan's New Developments in Foundry Industry Policies: Strengthening Supply Chain Resilience and Promoting Technological Innovation

In August 2026, Japan's Ministry of Economy, Trade and Industry released the "Foundry Industry Supply Chain Enhancement Plan," aiming to enhance the position of Japan's foundry industry in the global supply chain through policy support. The plan focuses on supporting the digital transformation and intelligent production of foundry enterprises, while encouraging closer cooperation between foundry enterprises and downstream industries such as automotive and electronics.

Policy highlights include: establishing a 10 billion yen "Foundry Technology Innovation Fund" to support enterprises in developing new foundry materials and processes; establishing a "Foundry Industry Digital Transformation Center" to provide technical consulting and talent cultivation for enterprises; implementing the "Foundry Industry Cluster Revitalization Plan" to support the integration and upgrading of local foundry enterprises.

Behind Japan's policy adjustments are concerns about global supply chain security. As an important part of high-end manufacturing, the foundry industry plays a key role in the manufacturing of components in automotive, electronics, aerospace and other fields. The Japanese government hopes to maintain industrial competitiveness in the context of global changes through policy support.

In terms of market performance, Japanese foundry enterprises are actively responding to policy guidance. In the first half of 2026, R&D investment of major Japanese foundry enterprises increased by 18% year-on-year, with investment in digital and green technology accounting for more than 60%. At the same time, Japanese foundry enterprises are accelerating overseas布局, especially establishing production bases in Southeast Asia to diversify supply chain risks.

South Korea's Changes in Foundry Industry Policies: Focusing on Semiconductor and New Energy Vehicle Supporting Industries

In September 2026, South Korea's Ministry of Trade, Industry and Energy released the "Medium and Long-term Development Strategy for the Foundry Industry," explicitly positioning the foundry industry as a supporting industry for two strategic industries: semiconductors and new energy vehicles. This policy orientation reflects the South Korean government's development approach of closely linking the foundry industry with national strategic industries.

The core policy contents include: establishing a 500 million won "Semiconductor Foundry Special Technology Fund" to support enterprises in developing high-precision casting technology; implementing the "New Energy Vehicle Casting Parts Certification Plan" to promote foundry enterprises to meet the lightweighting needs of electric vehicles; establishing a "Foundry-Semiconductor-New Energy Vehicle Industry Collaboration Platform" to promote cooperation between upstream and downstream of the industrial chain.

South Korea's policy adjustments have obvious industrial orientation, aiming to enhance the international competitiveness of semiconductors and new energy vehicles through the upgrading of the foundry industry. Especially in the semiconductor field, the South Korean government hopes that foundry enterprises can provide more precise and reliable key components such as packaging substrates and lead frames to support the development of the semiconductor industry.

From an investment perspective, South Korea's foundry industry policy has created opportunities in niche markets. High-precision semiconductor casting parts, lightweight automotive casting parts and other fields are expected to receive policy support, and valuations of related enterprises will be enhanced. According to industry analysis, from 2026 to 2028, South Korea's semiconductor casting parts market is expected to grow at an average annual rate of more than 15%, higher than the overall growth rate of the foundry industry.

Development of Foundry Industry Policies in Southeast Asian Countries: Undertaking Industrial Transfer and Promoting Localization

In 2026, major Southeast Asian economies have successively introduced policies to attract global foundry industry transfer while promoting the localization development of the foundry industry. Countries such as Vietnam, Thailand, and Malaysia are attracting foreign foundry enterprises to invest in factories through tax incentives, land support and other measures.

The Vietnamese government released the "Foundry Industry Development Plan (2026-2030)" in June 2026, proposing to increase the output value of the foundry industry to 5 billion US dollars by 2030, accounting for 5% of the total manufacturing value. Policy focuses include: building foundry industrial parks in Ho Chi Minh City, Hanoi and other places; providing tax reductions, with foreign foundry enterprises enjoying a 50% reduction in corporate income tax for the first five years; supporting the technological upgrading of foundry enterprises, establishing "Foundry Technology Training Centers".

Thailand launched the "Foundry Industry Upgrade Plan" in July 2026, encouraging joint ventures and cooperation between foreign foundry enterprises and local enterprises to promote technology transfer. Policy highlights include: establishing a "Foundry Industry Transformation Fund" to support enterprises in introducing advanced equipment; implementing a "Foundry Talent Cultivation Plan" to cultivate professional technical talents; establishing a "Foundry Industry Innovation Center" to promote industry-academia-research cooperation.

The core goal of foundry industry policies in Southeast Asian countries is to undertake global industrial transfer while improving the technical level and added value of the local foundry industry. These policies have already achieved initial results. In the first half of 2026, foreign investment in the foundry sector in Southeast Asia increased by 35% year-on-year, with investment from China, Japan, and South Korea accounting for more than 60%.

The Restructuring Impact of Policy Changes on the Foundry Industry Chain

The adjustments in foundry industry policies in various Asia-Pacific countries are reshaping the regional foundry industry chain from multiple dimensions. This restructuring effect is mainly reflected in the following aspects:

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• Industrial Layout Restructuring: Under the guidance of various countries' policies, the foundry industry layout shows regional agglomeration characteristics. The Yangtze River Delta and Pearl River Delta regions in China have formed high-end foundry industry clusters; the Kansai region in Japan focuses on precision casting; the Gyeonggi region in South Korea focuses on the development of semiconductor casting parts; Southeast Asian countries undertake the transfer of low and medium-end foundry production capacity.
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• Technology Path Differentiation: Different policy support directions have led to the differentiation of foundry technology development paths in various countries. China focuses on developing green foundry technology; Japan focuses on digital and intelligent casting; South Korea emphasizes high-precision casting technology; Southeast Asian countries pay more attention to the popularization and improvement of basic foundry technology.
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• Supply Chain Restructuring: Policies in various countries emphasize supply chain security, prompting foundry enterprises to re-evaluate supply chain layout. Foundry enterprises are accelerating regional layout, establishing multi-center and regionalized supply chain systems to reduce dependence on a single market.
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• Value Chain Reshaping: Under policy guidance, the value chain of the foundry industry is being reshaped. It is transforming from simple component manufacturing to providing overall solutions; extending from standardized production to customized services; and enhancing from single product supply to system integration capabilities.
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This industry chain restructuring is creating new investment opportunities. High-end foundry technology, green foundry solutions, intelligent foundry equipment and other fields will receive policy support and market favor. At the same time, collaborative innovation between the foundry industry and downstream industries will also spawn new business models and investment hotspots.

Investor Response Strategies: Seizing Policy Dividends and Layout Industrial Upgrading

In the face of policy adjustments in the Asia-Pacific foundry industry, investors need to formulate targeted investment strategies to seize policy dividends and layout industrial upgrading. Here are several key investment strategy directions:

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• Focus on Policy-supported Areas: Investors should closely follow the policy support directions of various countries, such as China's green foundry technology, Japan's digital casting, South Korea's semiconductor casting parts, etc. These areas will receive policy dividends, and valuations of related enterprises are expected to increase.
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• Grasp Regional Layout Opportunities: With the strengthening trend of foundry industry regional agglomeration, investors can pay attention to leading enterprises in industrial clusters and professional service providers that support industrial clusters.
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• Focus on Industrial Chain Collaborative Innovation: Collaborative innovation between the foundry industry and downstream industries will become an important direction for future development. Investors can focus on foundry enterprises that can provide overall solutions, as well as collaborative innovation opportunities between the foundry industry and strategic industries such as semiconductors and new energy vehicles.
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• Emphasize ESG Investment Value: Green foundry and sustainable development have become policy orientations. Investors can focus on foundry enterprises with excellent ESG performance, which will receive policy support and at the same time obtain market premium.
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• Seize Mergers and Acquisition Opportunities: Policy adjustments will accelerate industry integration. Investors can pay attention to industry M&A opportunities, especially in areas encouraged by policies such as industrial cluster development and enterprise integration.
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Specifically to investment targets, investors can pay attention to the following types of enterprises: first, technology-leading green foundry enterprises, such as China's new energy vehicle lightweight casting solution providers; second, digital transformation foundry equipment manufacturers, such as Japan's intelligent casting production line suppliers; third, high-precision semiconductor casting parts producers, such as South Korea's semiconductor packaging substrate manufacturers; fourth, foundry industry cluster operators in Southeast Asia, enterprises providing professional park services.

Future Outlook: New Asia-Pacific Foundry Industry Landscape Driven by Policies

Looking ahead, the Asia-Pacific foundry industry will undergo profound changes driven by policies, forming a new industrial landscape. By 2028, the Asia-Pacific foundry industry is expected to show the following development trends:

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• Accelerated Green Transformation: With the tightening of environmental policies in various countries, green foundry will become the mainstream. Low-carbon, energy-saving, and environmentally friendly casting technologies will be widely applied. It is expected that by 2028, the application proportion of green casting technology in the Asia-Pacific region will exceed 40%.
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• Enhanced Digitalization: Digital transformation will become the key for foundry enterprises to enhance competitiveness. Intelligent casting production lines, digital twin technology and other technologies will be widely applied. It is expected that by 2028, more than 50% of large foundry enterprises in the Asia-Pacific region will achieve digital production.
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• Industrial Cluster Development: Under policy guidance, the foundry industry will accelerate cluster development, forming several internationally competitive foundry industry clusters. These clusters will achieve resource sharing and collaborative innovation, enhancing overall competitiveness.
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• Deep Integration of Industrial Chain: The integration of the foundry industry and downstream industries will be deeper. Foundry enterprises will transform from simple component manufacturers to system integrators and solution providers, and the value of the industrial chain will be enhanced.
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• Strengthened Regional Coordination: With the acceleration of the Asia-Pacific regional economic integration, the foundry industries of various countries will strengthen cooperative cooperation, forming a regional industrial ecology with complementary advantages and clear division of labor, enhancing the overall competitiveness of the Asia-Pacific foundry industry.
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In general, the policy adjustments in the Asia-Pacific foundry industry in the second half of 2026 are reshaping the industry landscape and creating new opportunities for investors. Investors need to closely follow policy trends, grasp industrial upgrading trends, and layout niche fields and enterprises with long-term growth potential. At the same time, they should also pay attention to policy risks, do a good job in risk management, and achieve stable investment returns.

Against the background of profound adjustments in the global economic landscape and acceleration of industrial chain restructuring, the policy adjustments in the Asia-Pacific foundry industry are not only measures to respond to current challenges, but also strategic layouts for long-term development. Through policy guidance, the Asia-Pacific region is expected to build a more green, intelligent, and efficient modern foundry industry system, enhance its position in the global value chain, and inject new momentum for regional economic development.