Japan needs to strengthen its defense to strengthen diplomacy, Japanese Prime Minister Fumio Kishida said in a keynote speech.
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“To strengthen foreign policy, the defense capability of Japan itself is important. To protect the lives of the people, territory, air and sea space, and to strengthen defense capability, 43 trillion yen ($318 billion) will be allocated over five years,” the prime minister said.
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In June of this year, the Japanese Parliament passed a law on sources of financing for increased defense spending. It will provide non-tax sources to ensure increased military spending. The Japanese government intends to increase military spending to 43 trillion yen ($318 billion) over the five years from 2023 to 2027, which is 17 trillion (about $126 billion) more than the current level. To ensure non-tax revenues, a “Defense Capacity Strengthening Fund” will be created. It is planned to partially pay off the increased expenses by increasing corporate taxes, but due to the fact that this measure is extremely unpopular even within the ruling party, it was decided to postpone the start of its implementation by a year – from 2024 to 2025.
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The “Defense Capacity Strengthening Fund” in particular will be responsible for distributing 4.5 trillion yen ($34 billion) of non-tax funds for long-term defense needs included in the current year’s budget.
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In mid-December last year, Japan adopted three key documents on defense and security: the “National Security Strategy”, which defines the main directions of foreign policy in the field of defense, the “National Defense Strategy”, which outlines the goals and means of defense, and the “Defense Capability Plan” – it determines overall defense spending and the scale of weapons.
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Three documents outline an increase in Japan’s defense spending to 2% of GDP by 2027. This amounts to approximately 11 trillion yen ($81 billion).
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Military spending in fiscal year 2022 (ended March 31, 2023) amounted to 5.4 trillion yen ($40 billion), approximately 1.24% of GDP. In the current fiscal year, defense spending is a record 6.7 trillion ($52 billion), up 1.4 trillion yen ($10.4 billion) from fiscal 2022. In addition, a separate item includes revenues to the “Defense Strengthening Fund” in the long term – 4.5 trillion yen ($34 billion).
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The “National Security Strategy” and the “National Defense Strategy” stipulate the possession of “retaliatory strike capabilities,” which implies the defeat of enemy bases. Until now, these capabilities have been implied in Japan’s right to self-defense, but not spelled out. This change represents a significant shift in Japan’s defense policy.
