Last year Mitsubishi Heavy Industries announced the termination of development of its SpaceJet regional jet after years of delays in a blow to the country's aerospace ambitions.

The SpaceJet laid the foundations for an aircraft business but risk needs to be shared between the private and public sector and with international cooperation, the ministry said in a report.

The development would come as the aerospace industry looks to create commercially viable aircraft using technology such as electricity or hydrogen as an energy source to cut emissions.

($1 = 151.2000 yen)

(Reporting by Sam Nussey, Miho Uranaka and Maki Shiraki; editing by Philippa Fletcher)