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Japan Approves Record Defense Budget for Fiscal Year 2022

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Japan Approves Record Defense Budget for Fiscal Year 2022

Tokyo is striving to keep pace with China.

Japan Approves Record Defense Budget for Fiscal Year 2022
Credit: Kosuke Takahashi

On December 24, the cabinet of Japanese Prime Minister Kishida Fumio approved 5.4 trillion yen ($47.2 billion) defense spending in fiscal year 2022, starting in April, amid the increasingly tense security environment in east Asia.

Including U.S. Forces realignment-related expenses allocated for mitigating impacts on local communities, this marked another record figure for the eighth year in a row in the history of Japan’s national defense budget.

The draft budget, which is expected to be passed by Japan’s bicameral legislature in the coming months, represents a 1.09 percent nominal rise in annual spending and comes in at around 0.95 percent of the fiscal 2022 gross domestic product estimate released in July by the Cabinet Office. 

The Japanese Ministry of Defense’s request to buy new equipment had been brought forward into the supplementary budget for fiscal year 2021, which also hit a record high for an extra budget, thus virtually surpassing the long-standing cap of 1 percent of GDP for defense spending. 

Japan is striving to keep pace with China’s expanding military budget, which is already more than four times that of Japan’s and second only to the United States. With its limited financial resources, Tokyo has bolstered the country’s defense capabilities amid China’s growing assertiveness near the disputed Senkaku/Diaoyu Islands in the East China Sea for a decade.

The draft budget also represents Kishida’s strong commitment to continue the policies of his two predecessors, Abe Shinzo and Suga Yoshihide, of playing a bigger role in the Sea of Japan, East China Sea, South China Sea and the wider Western Pacific and Indo-Pacific theater amid growing military threats from North Korea, China, and Russia.

The 2022 defense budget includes 216.7 billion yen for the U.S. troops based in the country. Japan and the U.S. on December 21 agreed to increase Tokyo’s cost for hosting U.S. forces in the country for five years starting from the next fiscal year to begin covering spending for joint exercises, a move that is apparently aimed at easing Washington’s heavy pressure on Tokyo to expand its cost-sharing burden for countering China’s growing military power.

Specifically, under the new five-year agreement between the two countries, Japan will pay a total of 1.55 trillion yen from fiscal 2022. The annual average will increase by about 10 billion yen to 211 billion yen from the current fiscal year.

The budget will cover utility bills and costs of labor, and costs for transferring military drills, among other items. Japan will additionally pay up to 20 billion yen in five years for procuring equipment and materials needed for exercises.

The Ministry of Defense in Tokyo also secured 100.1 billion yen to continue developing Japan’s next-generation F-X fighter aircraft, including 10.1 billion yen for the conceptual design of the unmanned aircraft that are expected to support the platform.

The United Kingdom and Japan announced on December 22 that they have agreed on the joint development of engine technology for both the U.K.-led Tempest and Japan’s F-X future combat aircraft programs. With Rolls-Royce leading the engine demonstrator effort for the U.K., the Japanese lead has been decided to be taken by IHI Corporation.

Both nations expect their next-generation fighter aircraft to be operational by around 2035.

Meanwhile, the Japan Maritime Self-Defense Force (JMSDF) earmarked 6.1 billion yen to continue modifying its two Izumo-class helicopter carriers – JS Izumo and JS Kaga – into aircraft carriers capable of enabling Lockheed Martin F-35B fighter aircraft operations. The modification work of JS Izumo is due to be completed by fiscal 2026, with JS Kaga being completed by fiscal 2027.

A portion of the funds, or 3.6 billion yen, will be used to equip Izumo with a landing navigation system for F-35Bs, which according to ministry officials is likely be Raytheon’s Joint Precision Approach and Landing System (JPALS), while Kaga will undergo initial modifications to improve visibility for air traffic control.

In addition, the JMSDF secured 20.2 billion yen to acquire an undisclosed number of SM-6 air-defense missiles for the first time to arm its two Maya-class Aegis-equipped destroyers. It also wants 5.8 billion yen to modify the Lockheed Martin AN/SPY-7 solid-state radars (SSRs) Tokyo plans to fit onto two Aegis-equipped ships set to replace the cancelled ground-based Aegis Ashore ballistic missile defense systems.

The Japan Air Self-Defense Force (JASDF) secured 76.8 billion yen to buy another eight conventional take-off and landing F-35As and 51 billion yen for four short take-off and vertical landing F-35Bs during the next fiscal year. 

Japan is in the process of acquiring 147 F-35 fighters from the United States – 105 F-35As and 42 F-35Bs – over the coming decade, a move that will make the country the world’s second-largest F-35 operator after the United States.

The Japan Ground Self-Defense Force (JGSDF) was allocated 10.2 billion yen to acquire a new 1,700-ton logistic support vessel (LSV) as well as a new class of 350-ton landing craft utility (LCU) vessels to enhance its transportation capabilities.

In an emergency, these ships could also be used to transport fuel to front-line bases, especially in Japan’s southwestern Nansei island chain, which spans about 1,200 km from Kagoshima to Okinawa, stretching southwest towards Taiwan. The chain includes the disputed Senkaku/Diaoyu Islands, which are controlled by Japan but also claimed by China and Taiwan.

The Japanese Ministry of Defense’s Acquisition, Technology & Logistics Agency (ATLA) was allocated 6.5 billion yen to fund research and efforts to develop an electromagnetic (EM) railgun weapon system, which will be completed by fiscal 2026.

The Japan Ministry of Defense has been increasingly focusing on the development of advanced military technologies such as high-power microwave- and laser-based weapon systems to help counter the growing missile threat posed by neighboring countries.

Such technologies will most likely become a “game changer” in the field of missile defense, enabling Tokyo to shoot down multiple missiles simultaneously while drastically lowering the cost per intercept attempt compared with current technologies.

The ATLA said the total of its spending on research and development will increase by nearly 40 percent to 291.1 billion yen for the next fiscal year, with a focus on plans to further develop the missile used by the Type 12 Surface-to-Ship Missile (SSM) system into a stand-off weapon as well as the development of the nation’s next-generation F-X fighter aircraft.

Looking ahead, with Japan’s government debt already standing at 266 percent of GDP — the highest in the world and twice that of the U.S., there should be a strict limit as to how much Tokyo should add to its ballooning national deficit in an attempt to match China’s increasing military might.