Japan’s Expanding Military Role Could Be Good News for the Pentagon and Its Contractors

Japan, a country that swore off offensive warfare after World War II, took its first step down a very different path Thursday by passing legislation giving its military the power to engage in combat overseas. That’s something the Pentagon has wanted for years, and it could be very good news for U.S. defense contractors.

In January, the government of conservative Japanese Prime Minister Shinzo Abe endorsed a defense budget of nearly 5 trillion yen, or $42 billion, continuing a three-year growth trend after nearly a decade of decline. The sum still represents a small portion of Japan’s GDP — it accounts for just one percent of it, according to the World Bank — but because offensive military action is prohibited by Japan’s constitution, even a modest increase is controversial. Protesters rallied against the shift outside parliament Wednesday, the night before 11 controversial security-related bills were pushed through that will give Japan’s military the power to engage in more than just defensive actions.

This year’s defense budget is part of a larger push to improve Japan’s military capabilities. Abe has promised to spend 24.7 trillion yen, or $240 billion, between 2014 and 2019 on new warplanes, naval vessels, and drones, including American-made F-22s, F-35s, and Global Hawk drones. He’s also formed an advisory board, modeled after the U.S. National Security Council, to advise him on security matters.

The United States and Japan have been allies since shortly after World War II. In April, as Abe visited Washington, officials from both countries vowed to strengthen those ties.

“What should we call this, if not a miracle of history? Enemies that had fought each other so fiercely have become friends bonded in spirit,” Abe told U.S. lawmakers during a joint session of Congress.

During the same visit, the United States and Japan unveiled a new agreement, the Joint Defense Guidelines, which will allow greater military cooperation between the countries. As part of the deal, Japan agreed to shoot down missiles heading toward U.S. territory, even if Japan itself isn’t under attack. U.S. and Japanese military staffs can now work more closely.

When the partnership was announced, Secretary of State John Kerry and Defense Secretary Ash Carter and their Japanese counterparts, Foreign Affairs Minister Fumio Kishida and Minister of Defense Gen Nakatani, released a joint statement saying the new guidelines showcase “the ironclad U.S. commitment to the defense of Japan, through the full range of U.S. military capabilities, including nuclear and conventional.”

There’s a very specific reason that Tokyo and United States, which is currently attempting to reallocate more military resources to the region, are increasing their military cooperation: China. Tokyo is engaged in a tense standoff with Beijing over the contested Senkaku islands in the East China Sea. China, which calls them the Diaoyu, has also been building a series of concrete runways capable of handling military planes in the South China Sea’s contested waters. The two nations have been engaged in an increasingly sharp-edged war of words, and Beijing reacted harshly to this week’s vote.

“We solemnly urge the Japanese side to draw hard lessons from history, stick to the path of peaceful development, respect the major security concerns of its Asian neighbors, and refrain from jeopardizing China’s sovereignty and security interests or crippling regional peace and stability,” Hua Chunying, a Chinese Foreign Ministry spokeswoman, said in a statement after the lower house approved the measures Thursday.

For the moment, the idea of Japan jeopardizing China’s sovereignty anytime soon is a bit laughable. Reports indicate that Beijing’s 2015 defense budget increased 10 percent to around $145 billion, second only to the United States.

But $240 billion can buy Tokyo a lot of new equipment, which could be good for American defense contractors. F-35s are made by Lockheed Martin, based in Texas, and the Marine vehicles are manufactured by BAE Systems, based in Northern Virginia.

Tokyo also plans to buy U.S.-based Northrop Grumman’s Global Hawk drones. It’s also developing two Aegis radar-equipped destroyers and missile defense system with Washington. Those are made by Lockheed.

Japan’s embassy in Washington did not respond to a request for comment on Thursday’s vote.

The rise of China’s military, and the perceived decline of the Pentagon’s, is a key talking point cited by Abe’s allies pushing for the change. Last year, Yosuke Isozaki, a security advisor to Abe, said the United States “can no longer afford to play the world’s policeman.”

“This is no longer an era when Japan is permitted to do nothing and count on America to protect us. It’s become extremely important we do our own share alongside the U.S.,” he said.

Photo credit: Kena Betancur/Getty Images