The bankruptcy filing by Toshiba Corp.’s U.S. nuclear unit highlights the tough business climate in the sector and the scale of the challenge Japan faces in seeking to sell its nuclear technology abroad.

Westinghouse Electric Co. filed for Chapter 11 bankruptcy protection on Wednesday as its Japanese parent rushed to plug huge losses related to the nuclear business and pull out of the sector overseas.

Toshiba bought the U.S. nuclear energy company in 2006 for about ¥600 billion ($5.4 billion), aiming to expand its nuclear power business abroad as one of its core operations.

Such efforts by Japanese nuclear businesses to push exports have been taken up by Prime Minister Shinzo Abe as part of a growth strategy to revitalize the deflation-hit domestic economy.

Chief Cabinet Secretary Yoshihide Suga on Wednesday shrugged off views that Westinghouse’s bankruptcy may foil this push.

“It is important to take various steps in order to not affect the plan (to sell Japan’s nuclear technology),” Suga said at a news conference.

However, the nuclear business environment has changed dramatically since the 2011 Fukushima nuclear crisis. Stricter safety regulations introduced after the disaster have raised costs to construct plants and some countries have become more cautious about new reactors.

Germany has decided to pull out of nuclear power by 2022. The French government has provided a rescue package for nuclear giant Areva as it struggles with slowing demand and surging costs for new plants.

“It’s a high-risk business. It always has been,” Tadahiro Katsuta, a professor specializing in atomic mechanics at Meiji University in Tokyo, said. “Even before the Fukushima crisis, the nuclear business had been struggling. It’s not something one company can do on its own or can easily export like cars in terms of safety concerns.”

Toshiba said Wednesday it could post a group net loss of ¥1.01 trillion ($9.13 billion) for the fiscal year ending March 31, with massive costs related to the Chapter 11 filing. Westinghouse has $9.8 billion in total liabilities, much of which must be shouldered by Toshiba under a debt guarantee for the U.S. unit.

With the do-or-die decision on the filing, Toshiba will make all-out efforts to move out of its financial woes, Toshiba President Satoshi Tsunakawa told a news conference in Tokyo Wednesday evening.

“We are almost risk-free as we are pulling out of overseas nuclear operations, the biggest problem,” he said.

The financial woes have created the urgent need for the Japanese conglomerate to sell its cash-cow chip operation to raise funds, a move that will leave the company without any core money-making businesses after it sold its profitable medical business.

The nuclear climbdown is not a problem specific to Toshiba.

Hitachi Ltd., another major nuclear company, said last week it will book an estimated ¥65 billion write-down for fiscal 2016 related to a laser uranium enrichment joint venture with General Electric in the United States. The company said demand for nuclear fuel in the country was unlikely to grow as strongly as it had expected.

But Hitachi is not giving up on its nuclear ambitions. Last month, the firm said that it partnered with the Exelon Corp. group to promote a nuclear power project in Britain, seeking to use the largest U.S. nuclear power plant operator’s expertise in running a reactor.

“We have no plans to withdraw from the nuclear business,” a spokesperson at Hitachi said. “No business is risk-free … but we believe that nuclear operations will continue to generate profits.”

Mitsubishi Heavy Industries Ltd. has also been actively enhancing relationships with overseas nuclear companies.

“Nuclear power reduces greenhouse gas emissions and supports energy security,” a spokesperson at Mitsubishi Heavy said. “We will continue to hold our strong market position in terms of replacing existing nuclear plants and we will also reap benefits from our cooperation with France. Going forward with nuclear power will remain one of our major businesses.”

Mitsubishi Heavy and Japan Nuclear Fuel Ltd. said in February they will invest in Areva, which is a partner of Mitsubishi in a joint venture to develop nuclear plants.

Still, the dynamics in the energy sector have been changing drastically.

The emergence of shale oil and gas has made competition in the industry even tougher, keeping energy costs relatively low, while wind and solar power generation are also growing as alternative energy sources.

Hisashi Moriyama, an analyst at JP Morgan Securities Japan Co., said that unlike the past 30 years, the next 30 years will be about a shrinking nuclear energy market.

“Not only Japan, but the world’s nuclear industry is facing this problem,” Moriyama said. “Profit structures need to change along with the shifting market.”

The nuclear business could still gain a strong footing by pulling out of construction and focusing on maintenance and decommissioning a fleet of aging nuclear reactors both at home and abroad, he said.

Moriyama said Japan’s nuclear industry may need to seriously think about reorganization, including a merger among Toshiba, Mitsubishi Heavy and Hitachi.

“At a time when the number of plants continues to decline globally, there are too many players in the market. … The number of manufacturers needs to be slashed to boost profitability,” he said.