Japan’s future defense equipment policy

Picture of a poster of Japanese fighter planes.

2016 is a presidential election year in the United States. U.S. foreign policy and national security policy are being discussed during the presidential election campaign, and one candidate has strongly argued in favor of reconsidering U.S. alliances, perhaps making it a major issue of his. On the other hand, the United States has serious national security concerns around the world, not only current threats from global terrorism, but also high-end threats that will come in the near future. Currently, U.S. policymakers and government officials are attempting to maintain military superiority by introducing cutting edge technologies through strategies such as the Third Offset Strategy.

On the other side of the Pacific, Japan finds itself in the most severe security environment that it has experienced since the end of the World War II. To keep peace and stability in the Asia-Pacific region, Japan has started to drastically reform its national security policies in recent years to take a more proactive role in peace and stability in the world. Japan has also expanded its defense budget since 2013 after it saw consistent cuts over the prior decade. However, it may be difficult for Japan to strengthen its defense capabilities to overcome its increasingly difficult security environment and follow the United States’ new Third Offset Strategy during this period in time when Japan’s national strength is thought to be in relative decline.

What are Japan’s future national security policies for dealing with these challenges? One of the most significant challenges for Japan’s Ministry of Defense (MOD) is the acquisition of defense equipment because it has structural problems in terms of limited budget and long lead time. Japan has altered its defense equipment policies to relax its self-imposed ban on arms exports and established a new MOD acquisition agency that has consolidated numerous acquisition-related branches in MOD. However, it is hard to say whether this specific course of action is comprehensive enough to ensure Japan’s national security interests are fully met.

This paper explores specific ways to utilize Japan’s new defense equipment policies in order to maximize Japan’s national interests and contribute to the peace and stability of the Asia-Pacific region.

In the process, this paper describes Japan’s future defense equipment policy through studying the security policies of the United States and Japan while focusing on their nature. This paper tries to find whether or not Japan completely understands U.S. security policy. As a result of research, this paper recognizes that there are some misunderstandings in Japan’s government and defense industry about what the driver of the defense acquisition system is in the international community. These misunderstandings might cause long-standing challenges for Japan’s government and defense industry for many decades. Under this assumption, this paper introduces the implications for acquisition reform and specific defense equipment policies while identifying three major activities: the development of equipment, logistics support for allies, and capability building.

  • In terms of the acquisition reforms, this paper makes the case that Japan has to deal with further acquisition reforms by understanding the nature of acquisition reforms around the world. In brief, MOD has to establish:
    A knowledge management system that can utilize all knowledge that the acquisition workforce has accumulated as explicit and tacit knowledge.
  • A future oriented decision-making system that focuses on strategic and future perspectives without an excessive bureaucratic process.
  • An autonomous improvement culture where the entire workforce can improve itself by having people with different jobs work interactively.

Then this paper points out some specific defense equipment policies that Japan should follow in order to contribute to the peace and stability of the region in cooperation with allies and partners. Specific future equipment policies that Japan can use as tools for national security are:

  • The development of competitive equipment that can perform even in the future strategic environment that utilizes cutting edge technologies, such as those envisioned in the Third Offset Strategy. Specifically, MOD should promote international arms development and exports by utilizing various advantages that the Japanese defense industry offers while establishing a mutually interactive communication system. In addition, MOD should remove barriers that prevent innovative new actors from entering into the defense industry.
  • The enhancement of logistics support to allies and partners along with industry’s Maintenance, Repair, and Overhaul (MRO) business while preparing “portfolios” that describe a support menu that the Japan Self-Defense Force (JSDF) and industry can support.
  • The expansion of capacity building assistance to the Southeast Asian countries while focusing on non-traditional military activities such as Humanitarian Assistance and Disaster Relief (HADR). In addition, MOD has to cooperate with other organizations in the international aid community through information sharing and collaboration.

This paper also tries to make estimations about the future of Japan’s defense industry including the expansion of arms sales and other outcomes of policies suggested. In brief, this paper estimates that Japanese defense industry can expand its arms sales by about 40 percent by 2020 compared to 2014. This estimate will be realized when Japan’s government can achieve its expected economic growth. This is because Japan’s defense industry depends highly on domestic demand. The promotion of arms exports in cooperation with government and industry is as important as domestic demand. This paper estimates that the increase of Japan’s arms exports can push up the total amount of arms sales by 10 percent, if Japan’s government is able to promote selling Japanese equipment, such as submarines and an aircraft.

Moreover, this paper points out that some new industries in Japan will enter the defense field by utilizing their advanced IT, component technology, and dual-use technology. There can be tremendous possibilities when Japan’s huge technical and industrial firms join the world defense market.

Japan’s defense equipment policy reforms have so far only resolved about half of the numerous problems that have accumulated through many decades. This paper recognizes there are some common factors across these challenges that originate from Japanese culture and history that are difficult to solve.

However, it is still possible to influence the vector of reforms positively so that all challenges can be turned into chances. This paper make the case that it will be a “game changer” for Japan when MOD materializes Japanese-style innovation while integrating various ideas around the country and making bottom-up improvement continuously.