Japan's Defense Surge: A New Era of Military Spending

Japan's defense budget has been on a steady rise, with a record-breaking ¥8.54 trillion ($59.76 billion) requested for fiscal year 2025. This marks a 7.5% increase over the current year's budget and a 10.6% rise from the initial defense budget submission for FY24. The budget aims to push defense spending above 1.4% of GDP if approved, aligning with Japan's ongoing military budget expansion and the Defense Buildup Program launched in December 2022. This program aims to spend ¥43 trillion ($300 billion) from 2023 through 2027, with the goal of increasing defense spending to 2% of GDP. The changing security environment, characterized by China's military expansion, North Korea's nuclear and missile developments, and Russia's invasion of Ukraine, has driven this shift in Japan's defense strategy.



Japan's defense spending as a percentage of GDP is set to reach 2% by 2027, aligning with NATO members' response to Russia's invasion of Ukraine. This compares to 2.8% for the US, 1.1% for China, 3.0% for Russia, 2.5% for South Korea, and 1.3% for Germany. Japan's increased spending reflects its evolving security environment and expectations from allies.

Japan's defense spending priorities differ from other major economies, focusing on counterstrike capabilities and offensive defense. In 2024, Japan allocated ¥1.2 trillion for missile attack and defense capabilities, including precision-guided missiles and hypersonic missiles. In contrast, the US spends more on research and development, while China prioritizes naval and air force modernization. Japan's emphasis on counterstrike capabilities aligns with its evolving role in the US–Japan alliance, reshaping the regional security architecture.

Japan's economic situation, marked by slow recovery and inadequate growth momentum, is a concern amidst its record defense budget. With public debt escalating, the government relies on higher corporate, income, and cigarette taxes to fund defense. This has sparked dissatisfaction among citizens, highlighting the challenge of balancing economic pressures with military buildup. Despite these issues, Japan aims to increase its annual security budget to around 2% of GDP within five years, demonstrating its ambition to rebuild itself as a military power.

The US-Japan alliance plays a pivotal role in Japan's military expansion, as highlighted in the National Security Strategy (NSS) and National Defense Strategy. Japan's new policies, approved in late 2022, emphasize a more active role in collective self-defense with the US and an increased ability to project force beyond its borders. The alliance is crucial for Japan's security, with the US providing a deterrent against regional threats, particularly from China and North Korea. Japan's defense buildup, including the acquisition of counterstrike capabilities, aligns with US expectations and aims to protect the 'post-war international order.' The alliance also facilitates joint operational coordination, with Japan bearing more costs for US troops stationed there and integrating its military into the US combat system.

In conclusion, Japan's defense budget surge reflects its evolving security environment and commitment to protecting its national interests. As Japan continues to invest in its military capabilities, it faces economic challenges and public scrutiny. The US-Japan alliance remains a critical factor in Japan's military expansion, with both countries working together to maintain regional security and stability.