Country Survey XIII: Japan's security posture and defense industry prospects

Michael Chinworth

Defence and Peace Economics, 2000, vol. 11, issue 2, 369-401

Abstract: Defense budgets in Japan have been complicated compromises from numerous inputs - including threat perceptions, domestic industrial/technological base development, support for the bilateral security treaty with the United States and internal bureaucratic politics - but with the fall of the former Soviet Union, the clearest justification for higher spending disappeared. Double-digit defense spending increases that were common in the 1980s have been replaced by annual increases lower than present inflation rates, resulting in negative real growth in the country's defense budget. Domestic economic problems and consistent government pressures for smaller budgets have further slowed annual growth in total spending and have contributed to lower procurement budgets. As a result, the domestic Japanese defense industry is facing far more constrained conditions from the growth years of a decade before. Government policymakers are examining Japan's regional security environment as well as its alliance with the United States to determine the appropriate course for the country to take in the coming years. The formal security treaty with the United States is likely to remain a major element of government positions, but other aspects of the country's overall security posture are open to debate. Perceptions of a reduced threat environment are fueling additional pressures for defense budget cuts. The domestic defense industry seeks means to assure its survival in domestic defense markets in this constrained environment. Expansion into overseas markets to offset declining domestic markets is an option that currently is constrained by policy restrictions on arms exports. Industry is advocating re-examination of those policies and unlike earlier years, government appears willing to respond positively but cautiously to this lobbying.

Keywords: Japan; Security policy; Defense industry; Kokusanka; FSX/F-2; Theater Missile Defense (TMD); Ballistic Missile Defense Organization (BMDO); Defense procurement; Budgets; U.S. Security Treaty; Defense technology cooperation (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (1)

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DOI: 10.1080/10430710008404955

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