Growing Defence Budgets in Indo-Pacific: Examining Japan's 26.3% increase

 

 

On December 23, 2022, the cabinet of Japanese Prime Minister Kishida Fumio approved a significant defense budget of 6.82 trillion yen (approximately $51.4 billion) for fiscal year 2023, representing approximately 1.19% of Japan's GDP. In defending this decision, Prime Minister Kishida Fumio emphasized the importance of national security in light of evolving regional threats. He stated that Japan must "fundamentally reinforce" its defense capabilities, recognizing the need for a "proactive" approach to ensure the safety of its citizens. This underscored Japan's commitment to adapting its defense posture in a changing geopolitical landscape.

KEY POINTS

Largest annual rise in Japan's defense budget since World War II

This increase, expected to exceed ¥6 trillion (around $55 billion), can be seen in line with Japan’s new National Security Strategy and long-term defense strategy, aiming to enhance national defense capabilities and resilience. The rise focuses on areas such as missile defense and naval capabilities, but funds are also expected to be allocated to modernize the Self-Defense Forces (SDF), including acquiring advanced weaponry and improving cyber defense. The main investments are detailed below:

• Naval Capabilities: New submarines, destroyers, and potential aircraft carriers to enhance naval power and blue-water operations.
• Missile Defense Systems: Enhancements to the Aegis system and the development of land-based missile interceptors.
• Air Force Modernization: Japan continue to upgrade its air capabilities, focusing on acquiring more F-35 fighter jets and enhancing air defense systems. Investments are also expected to be made in drone technology and unmanned systems.
• National Defense Production: The budget is also aimed to boost its domestic defense industry through increased investment in research and development of indigenous weapons systems, including advanced artillery and surveillance capabilities.
• Cyber Defense: Increased funds to strengthen cyber defense capabilities to protect critical infrastructure and military networks.

Japanese public opinion on defense has gradually shifted

Initially, the national post-war sentiment was strongly pacifist, reflected with the 1947 constitution emphasizing renunciation of war. However, significant disruptive events such as North Korea's missile tests and China's military expansion, sparked increasing concern among Japanese population. Polls in the 2010s revealed growing support for a stronger Self-Defense Force, and a 2014 survey showing over 50% favoring constitutional reinterpretation for collective defense. In 2022, public backing for increased military spending surged, influenced by Russia's invasion of Ukraine.

Future Commitments, Regional Security Concerns and International Collaboration

Japan plans to maintain this higher level of spending, aiming to allocate 2% of GDP to defense by 2027 to align with NATO standards. During the last decades, Japan’s interest in strengthening defense ties with allies has only grown, particularly the United States, and engage in joint military exercises. These decisions have been largely driven by growing tensions in East Asia, particularly with North Korea's missile program and its first successful test of a long-range missile on July 4, 2006, and China's expanding military presence in the region, especially with its assertive presence escalation in South China Sea during the year 2020. 

OPPORTUNITIES

Strengthened Deterrence 

Japan’s enhanced military capabilities can act as a deterrent against regional potential aggressors and threats, particularly North Korea's missile adventurism and China's increasing military assertiveness. Imposing greater costs and obstacles to the use of offensive force by other regional actors can lead to a more stable security environment, making interstate violence less likely, as aggressive states now face higher costs for their potential hostile decisions. Nevertheless, the implementation of policies to increase a country's deterrent power must always be carefully studied in order not to provoke the opposite effect, a misinterpretation that would provoke fear and insecurity in other regional actors, leading them to increase their own military capabilities, a clear Risk of this increase in the defense budget.

Enhanced Alliances and Multilateral Engagement

Increased defense spending can also facilitate deeper military cooperation with Japan's established and potential allies like the U.S., Australia, and India. Getting more paired to their military spending and technology level may foster a unified front against common threats, creating the foundations for a potential future Collective Defense that acts as the ultimate deterrent to hostile and disruptive intentions in the region. A more balanced military power between these allied countries can also enhance intelligence sharing to improve situational awareness and response capabilities. In turn, this may forestall hostile actions, which increases the scope for prevention and resolution through peaceful methods such as diplomatic mediation or threatening with non-military consequences such as economic sanctions. 

Multilateral Security and Regional Defense Initiatives 

Japan has the opportunity to play a pivotal role in multilateral security dialogues and initiatives, contributing to collective security frameworks that promote stability. Further joint capabilities and a common framework can enhance response to natural disasters and Humanitarian Assistance and Disaster Relief (HADR), fostering goodwill and collaboration in the region. Increasing ties of cooperation between different countries is an effective strategy for reducing tensions, distrust and regional rivalries. Furthermore, these enhanced regional dynamics would also improve coordinated naval operations to reinforce commitments to international law and freedom of navigation in contested waters, which has lately been threatened and hindered in the region.

RISKS

Misunderstandings, Arms Race and Escalation

Japan’s military buildup could also provoke an arms race in the region, with neighboring countries feeling compelled to increase their own military spending and capabilities. It is important that other regional actors view this increase in the defense budget as a defensive decision, since investment in capabilities that can be used offensively can generate a sense of threat for other actors that would generate a response totally opposite to the initially intended, potentially leading to a military escalation to compensate for any military power imbalances between regional actors that could leave one of the actors in too much military inferiority. This misinterpretation can increase the likelihood of further regional tensions and conflicts. 

Nationalism and Regional Tensions

Increased defense spending may fuel nationalist sentiments, particularly in China and South Korea, potentially exacerbating historical grievances and regional tensions. In both China and South Korea, nationalist sentiments are often tied to historical grievances against Japan, with calls for acknowledgment and reparations continuing to affect diplomatic relations. In South Korea and China, anti-Japanese protests can erupt, particularly around anniversaries of significant historical events, such as the Nanjing Massacre or Korea's liberation from Japanese rule. Furthermore, ongoing territorial disputes, such as Dokdo/Takeshima islands with South Korea and the Senkaku/Diaoyu islands with China, are influenced by historical narratives, further straining relations.

Focus Shift from Diplomacy

A greater emphasis on military capabilities might detract from diplomatic efforts to resolve conflicts peacefully, leading to a more militarized approach to international relations and crisis situations in the Indo-Pacific. Japan’s recent moves to increase its defense capabilities might also be interpreted in the context of its militaristic history, prompting China and South Korea to view these actions with suspicion, and joint military exercises between Japan and the U.S. can further exacerbate these feelings. For some critics, Japan's increased focus on its military capabilities shows the weakness of diplomacy in the region, as regional powers would be shielding themselves from the probable failure of diplomatic channels which no one trusts enough to avoid having to increase their national military stocks.

TAKEAWAYS

• Significant Shift in Defense Policy. Japan's 26.3% increase in defense spending represents a major departure from its post-war pacifist stance, reflecting heightened concerns over regional security threats.
• Strengthened Alliances. The boost in military capabilities is likely to enhance Japan's collaboration with allies like the U.S. and contribute to a more unified defense posture in the Indo-Pacific.
• Potential for Regional Arms Race. While improved defense capabilities can deter threats, they may also provoke an arms race among neighboring countries, escalating tensions.
• Opportunities for Multilateral Engagement. Japan can leverage its increased military strength to play a more active role in multilateral security dialogues, promoting stability through collective efforts.
• Balancing Defense and Diplomacy. The focus on military expansion must be balanced with diplomatic initiatives to ensure that security measures do not overshadow peaceful conflict resolution efforts.