NATO just set its defense spending target at 5% of GDP. Can Japan do the same?

The Mainichi

4 days ago

TOKYO -- "Rather than a simple call for military expansion, this probably reflects the issue of how allies respond financially to the burden felt by the United States."
A senior Japanese Defense Ministry official offered this analysis of a recent agreement by the North Atlantic Treaty Organization (NATO) members to raise defense and defense-related spending targets to 5% of their GDP. Given that Japan also relies heavily on its alliance with the U.S., the ministry official expressed concern that these developments could affect Japan's own security and budgeting.
For decades, Japan's defense spending remained around 1% of GDP. Just two and a half years ago, at the end of 2022, the Japanese government announced plans to strengthen national defense significantly and pledged to increase total defense-related expenditures to 2% of its fiscal 2022 GDP by fiscal 2027.
Under its current defense buildup plan, the Defense Ministry has already allocated substantial sums: 5 trillion yen (approx. $34.6 billion) over five years for counterstrike "standoff defense capabilities," including long-range missiles, and an additional 3 trillion yen (approx. $20.7 billion) for integrated air-and-missile defense, including the construction of ships equipped with the Aegis missile-interception system. Japan's total defense-related spending in the current fiscal year's initial budget amounts to 9.9 trillion yen (approx. $68.4 billion, around 1.8% of GDP), clearly approaching but yet to reach the 2% goal.
Even amid these already ambitious plans, pressure from the U.S. for Japan to boost spending even further is rapidly increasing. On June 21, Chief Pentagon Spokesman Sean Parnell strongly suggested that America's Asian allies -- explicitly including Japan -- should also raise their defense-related spending to reach 5% of GDP. U.S. Under Secretary of Defense Elbridge Colby, the Pentagon's third-ranking official, has repeatedly proposed Japan boost its defense budget to 3% of GDP. Additionally, some British media reported on June 20 that Colby had called on the Japanese government to aim as high as 3.5% of GDP.
Regarding these reports, a Japanese government official stated, "We've never been formally approached with such requests," but hinted undersurface pressure indeed exists, adding that there are people quietly pushing for an increase within parts of the U.S. government.
What matters is the quality of our defense capabilities
Even when Japan initially set the 2% target, the government faced criticism for prioritizing numbers over substance. The administration currently remains careful not to focus solely on spending goals. At a June 24 press conference, Defense Minister Gen Nakatani emphasized, "What matters most remains the actual quality of our defense capabilities." Prime Minister Shigeru Ishiba also highlighted at a June 23 press conference, "The critical point is that we independently determine what we truly need and naturally coordinate closely with our ally, the United States." A Defense Ministry official similarly explained, "It is first vital for Japan to discuss strategic priorities and how to strengthen defense measures. Any discussion about spending targets would come afterward."
Nonetheless, the Japanese government clearly referenced NATO countries' numbers when adopting the initial 2% figure. The original recommendation of spending 2% of GDP on defense originates directly from NATO, and Japan's ruling Liberal Democratic Party (LDP) has repeatedly pointed to NATO practices as a model. Japan formally mentioned the NATO target of 2% in its government policy guidelines formulated in June 2022, as well as in its August 2022 defense white paper. Subsequently, the 2% commitment was written explicitly into the new National Security Strategy approved later that year.
Given current fiscal circumstances...
Yet skepticism about the feasibility for Japan to reach as high as 5% already exists. Even a simple calculation implies more than doubling current spending plans, prompting some in the Defense Ministry itself to doubt the figure's practicality. One involved official expressed concern, asking, "Can Japan realistically budget those enormous sums considering the present state of government finances -- and even if we did, could we properly execute such spending?"
It should be noted that spending expressed as a percentage of GDP includes expenditures beyond just the defense ministry's official budget. Expenses classified as "complementary defense measures" are also included, such as subsidies related to U.S. military bases handled by ministries and agencies other than the Defense Ministry, the budgets of the Japan Coast Guard, cybersecurity-related funding and strategic public infrastructure. While the Japanese government is actively designating and developing airports and seaports as public infrastructure also used for defense purposes, new developments do not require continuous large expenditure and substantial growth in defense-related funding is not expected to continue.
The current defense buildup plan ends in fiscal 2027, and this year marks the halfway point of that long-term plan. Within the LDP, discussions regarding the formulation of the next phase of defense expenditure and capability enhancement measures are expected to begin in earnest after the summer House of Councillors election. Reflecting on NATO's latest spending goals, a Defense Ministry official noted, "The NATO agreement will likely serve as a catalyst pushing us toward faster discussions on additional defense strengthening and further defense spending."