Strategic Posture Review: Japan

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As an advanced industrialized democracy and the world’s third-largest economy, Japan is well-positioned to help shape the economic, security and institutional architecture of the Asia-Pacific as the region increasingly becomes the center of gravity in the international system. Yet this island nation is beset by several challenges, including anemic economic growth, public debt, an aging population, a declining birthrate and political paralysis that could complicate efforts to sustain its strategic and diplomatic weight. The earthquake and tsunami of March 11, 2011, illuminated some of these challenges, and the subsequent nuclear disaster brought energy security to the fore as the country scrambles to find alternative sources amid public anxiety about the safety of nuclear power. Japan’s strategic posture in the region and beyond depends fundamentally on whether political leaders can devise a plan for sustainable growth.

As Japan focuses on the urgent need for a growth strategy, it also remains attuned to an external security environment that presents a range of challenges that could affect its national security. These include instability on the Korean Peninsula, nuclear proliferation, the opaque nature of China’s military buildup, territorial disputes, piracy and terrorism. Japanese defense policy continues to evolve in response to changes in the international security environment, but a sluggish economy and ongoing political debates about the role of the Self-Defense Forces (SDF) could continue to put downward pressure on defense spending and render security strategies insufficiently resourced. Furthering joint capabilities under the rubric of its security alliance with the United States and fostering relationships with new partners are priorities for Japan in this period of fiscal stringency.

With the United States, Japan’s closest ally, having recently announced a “pivot” to the Asia-Pacific to support regional security and prosperity, Japan’s strategic posture will be anchored by the common strategic objectives of the U.S.-Japan alliance as well as its own diplomatic engagement with the developing countries and rising powers of the region. Working with the United States and other partners, Japan has a unique opportunity to champion rules and norms, from trade liberalization to nuclear nonproliferation, that will ensure a future that is as stable as it is prosperous. Sustaining a visible strategic and diplomatic profile will ultimately depend on political stability and economic revival domestically.

Foreign Policy

The U.S.-Japan alliance constitutes the cornerstone of Japanese foreign policy. The strategic bargain struck between Japan and the United States at the end of World War II, which first took shape with the signing of the San Francisco Peace Treaty in 1951, dictated that Japan would embrace democracy, renounce offensive military capabilities and allow the United States to retain bases in Japan. Japanese Prime Minister Shigeru Yoshida developed his own interpretation of the relationship, later dubbed the Yoshida Doctrine, which captured the essence of Japanese foreign policy in the Cold War era: Japan would ally with the West, do the minimum necessary for defense cooperation with the United States and focus on reviving its economy. This core strategic bargain, clarified in the Treaty of Mutual Cooperation and Security between Japan and the United States in 1960, came under stress periodically as Japan tried to balance a simultaneous desire for increased sovereignty and a security umbrella from the United States. It remained intact, however, allowing Japan to engineer its economic revival while gradually increasing its commitments to defense in response to changes in the international security environment.

Building on its increased economic prowess, Japan used economic tools such as official development assistance to advance its own diplomatic initiatives, while considering the bilateral agenda with the United States as the foundation of its foreign policy. A prime example of economic diplomacy was the Fukuda Initiative, named after former Prime Minister Takeo Fukuda, launched in 1977 to promote the economic development of Southeast Asia. Though periods of friction arose occasionally with the United States, such as during the 1980s, when Japanese exports threatened the competiveness of U.S. firms, the strategic logic of the Cold War served to dampen tensions. The end of the Cold War rendered Japan’s pro-West, pro-business, anti-communist formula obsolete. Japan’s foreign policy agenda, as well as the bilateral alliance with the United States, subsequently evolved in response to new challenges, such as the Asian financial crisis, tension on the Korean Peninsula and the fight against terrorism.

A joint statement released in June 2011 by the U.S.-Japan Security Consultative Committee (SCC), composed of the U.S. secretaries of state and defense and their Japanese counterparts, is a testament to the current breadth of the foreign policy agenda. Regional priorities include the denuclearization of the Korean Peninsula; encouraging China’s responsible and constructive role in regional stability and prosperity, while improving openness and transparency with respect to its military modernization; strengthening cooperation with Australia, South Korea, India and the Association of Southeast Asian Nations (ASEAN); and encouraging Russia’s constructive engagement in the Asia-Pacific Region. The document also references concerns about Iran’s nuclear program, the need to support stability and prosperity in the Middle East and North Africa, and the importance of good governance and development in Afghanistan. Other issues include eradicating terrorism, promoting nuclear nonproliferation and encouraging United Nations Security Council reform to include Japan as a permanent member.

Japan’s diplomatic agenda also includes regional and global dimensions, beginning with relations with its neighbors. China is Japan’s largest trading partner, but residual tensions stemming from Japan’s occupation of China during World War II, as well as territorial disputes in the East China Sea and Japan’s concerns about China’s military buildup — particularly its naval expansion — complicate the bilateral relationship. An incident in September 2010 in which a Chinese fishing boat collided with Japanese Coast Guard vessels near the disputed Senkaku Islands caused a crisis and a series of escalatory responses from China, including the cessation of rare earth metal exports to Japan, though bilateral summitry has since resumed.

History and territorial disputes also feature in the bilateral relationship with South Korea, but the prospects for enhanced security cooperation have improved in the wake of a series of North Korean provocations in 2010. Both countries sent observers to each other’s military exercises with the United States over the past two years, for instance.

Japan also has developed robust economic and security ties with Australia and India, the only countries besides the United States with which Japan has signed a joint security declaration. Australia and Japan signed a joint declaration in March 2007 outlining areas for cooperation, including counterterrorism, maritime and aviation security, and humanitarian assistance and disaster relief. In May 2010, the two countries signed an Acquisition and Cross-Servicing Agreement (ACSA), providing a framework for the reciprocal provision of supplies and services for such activities as exercises and training, U.N. Peacekeeping Operations, humanitarian relief operations, operations to cope with large-scale disasters, transportation of nationals and others in overseas exigencies, among other routine activities. Negotiations over a bilateral Economic Partnership Agreement have been ongoing since 2007, with the sticking points due in large part to Japanese sensitivities in the agricultural sector.

Japan and India penned a joint security declaration in October 2008 and have developed dialogue channels focused mainly on maritime security: safety, freedom of navigation and anti-piracy activities. The bilateral agenda also emphasizes joint exercises, and in 2009 the Indian navy invited Japan’s Maritime Self-Defense Force (MSDF) to participate in the Malabar Exercises with the U.S. Navy. A bilateral exercise between the Indian navy and the MSDF is scheduled to take place in 2012. Japan and India signed a Comprehensive Economic Partnership Agreement that entered into force in August 2011, and Japan provides substantial development aid for projects such as the Delhi-Mumbai Industrial Corridor.

A longstanding dispute over the Northern Territories casts a pall over Japan’s relationship with Russia, but the countries have coordinated closely in the context of the G-8 Summit and the Six-Party Talks focused on the denuclearization of the Korean Peninsula. Energy trade animates the economic relationship, and Japan could expand its interest Siberian gas as it seeks alternative sources of energy supply in the aftermath of the March 11 disasters. Indeed, Prime Minister Yoshihiko Noda stressed the potential to expand bilateral cooperation in the energy sphere on the one-year anniversary of the tragedies.

Trade liberalization features prominently in Japan’s economic diplomacy portfolio in the Asia-Pacific. Traditionally a steadfast supporter of multilateral trade negotiation under the rubric of the World Trade Organization, the collapse of the Doha Round necessitated a shift on the part of Japan in favor of free trade agreements at the bilateral and multilateral levels. Japan has promoted the Comprehensive Economic Partnership for East Asia (CEPEA) as an intraregional mechanism for trade liberalization but also has participated actively in the Asia-Pacific Economic Cooperation (APEC) forum to encourage trans-Pacific trade architecture. In November 2011, Japan expressed interest in entering discussions over the Trans-Pacific Partnership, a comprehensive trade negotiation among nine countries including the United States. Japan is also discussing a trilateral trade initiative with South Korea and China, evidence of the competitive trade liberalization that is fueling the region.

The broader institutional architecture of Asia has animated Japanese regional diplomacy for quite some time, and Japan remains actively involved in shaping the agendas of regional institutions. Japan has been a steadfast supporter of ASEAN for decades and participates in its own dialogue with the institution. In addition, it participates in the ASEAN +3, with South Korea and China, as well as larger gatherings such as the ASEAN Regional Forum (ARF), the ASEAN Defense Ministers Plus (ADMM+) and the East Asia Summit (EAS), to address a wide range of issues affecting the region. Japan recently supported the 2011 Master Plan for ASEAN Connectivity, an initiative to narrow development gaps and further economic integration in the region.

Japan’s commitment to development is not limited to the Asia-Pacific. Japan contributed $5 billion in aid to Iraq in 2003 and in 2009 pledged the same amount for development efforts in Afghanistan. In 1993, in collaboration with the United Nations, Japan helped establish the Tokyo International Conference on African Development (TICAD), a global framework for promoting Africa’s development priorities, and has organized several summits dedicated to this cause. The Japan International Cooperation Agency (JICA) is the world’s largest bilateral development assistance agency, and Japan’s steadfast support for the United Nations and the international financial institutions furthers its efforts in these areas.

Strengthening the U.S.-Japan alliance, engaging its neighbors, supporting the economic and institutional development of the Asia-Pacific region and providing aid to the broader developing world illustrate the comprehensive nature of Japanese foreign policy. With respect to doctrine, recent attempts at branding Japanese foreign policy indicate the potential to develop a broad framework based on rules and norms. In 2006, the administration of Prime Minister Shinzo Abe advocated a “values-oriented diplomacy” based on universal values, which he defined as democracy, human rights, the rule of law and market economies. Abe’s foreign minister, Taro Aso, proposed an “arc of freedom and prosperity” stretching from countries such as Cambodia and Vietnam in Southeast Asia to states like Georgia and Azerbaijan in Central Asia to support democracy and economic prosperity. The Abe administration was short-lived, however, and successor governments under his Liberal Democratic Party (LDP) failed to elaborate on these concepts. Such rhetoric has yet to emerge since the Democratic Party of Japan (DPJ) assumed power in 2009, but in a speech in Washington in January 2011, former Foreign Minister Seiji Maehara declared that Japan should help build a new order in the Asia-Pacific region and “develop institutional foundations embodying the rule of law, democracy, respect for human rights, . . . and free and fair trade and investment rules, including protection of intellectual property rights.” This is by no means a consensus view, though, and a distinct foreign policy vision may prove elusive in the near term as a divided legislature has produced a series of short-term governments. Nonetheless, the normative aspects of Japan’s foreign policy agenda could assume an increasingly central role in the future.

Defense Policy

Article IX of Japan’s postwar constitution renounces war as a sovereign right and the threat or use of force as a means of settling international disputes. In contrast, Japan, as a member of the United Nations, has the right to individual or collective self-defense. Japan’s defense policy over the past 60 years has sought to strike a balance between the constitution’s pacifist principles and a desire to play a role in maintaining international peace and security. Japan has gradually increased its defense capabilities in response to new challenges, and the SDF works closely with the United States in the context of the bilateral security alliance and increasingly with other countries to support regional and global security.

Articles V and VI of the Treaty of Mutual Cooperation and Security between Japan and the United States refer to the U.S. commitment to defend Japan and permission for the United States to use bases in Japan for regional security, respectively. Consistent with the Yoshida Doctrine, Japan relied on the U.S. security umbrella for deterrence at the outset of the Cold War and assumed some responsibility for defending its territory. In 1978, as Soviet military power expanded in the Far East, Japan and the U.S. signed bilateral guidelines for defense cooperation in which Japan committed to sea-lane defense and joint exercises for the defense of Japan. Tokyo’s support for Washington’s Cold War-era strategy of containment was a major chapter in Japanese defense policy, but pressure to assume responsibilities beyond the defense of Japan mounted after the end of the Cold War.

Japan’s first big test came with the Persian Gulf War: Despite providing $13 billion for the war effort, Japan was criticized for pursuing “checkbook diplomacy” and was encouraged to take on new missions. In 1991, Japan dispatched the SDF overseas for the first time for minesweeping activities in the Gulf, and the following year Tokyo authorized SDF participation in U.N. peacekeeping operations. Concerns about instability on the Korean Peninsula and in the Taiwan Strait prompted the United States and Japan to announce a joint declaration on security in 1996, and a year later they revised the 1978 defense guidelines to broaden the SDF’s role in regional security. A North Korean missile test in 1998 led Japan to create an exemption in principles limiting arms exports to pursue ballistic missile defense cooperation with the United States.

After the attacks of Sept. 11, 2001, Japan passed special legislation to dispatch the Maritime Self-Defense Forces to conduct refueling operations in support of Operation Enduring Freedom and to support reconstruction efforts in Iraq under Operation Iraqi Freedom. In a further demonstration of how advanced and diverse SDF capabilities had become, Japan played a leading role in humanitarian assistance and disaster relief efforts after the 2004 Indian Ocean earthquake and tsunami, expertise it would display again at home after the triple disasters of March 11, 2011. The remarkable evolution of the SDF’s roles and missions required reinterpretation of Article IX by political leaders to meet emerging security requirements, a process that will continue into the future.

Japan’s defense doctrine was outlined most recently in December 2010 in a policy overview known as the National Defense Program Guidelines (NDPG). The document addressed four main themes with respect to concerns about the security environment: the nature of China’s military buildup; the North Korean nuclear and missile programs; increasing potential for “gray zone conflicts” — that is, territorial disputes short of war; and global challenges such as the military use of cyberspace, international terrorism and piracy. The NDPG then introduced the concept of “dynamic defense,” which departed from core principles focusing on homeland defense toward a more pro-active posture in support of regional and global security. The document called for a reallocation of resources from the Ground Self-Defense Forces, which featured prominently in previous strategies to defend the country’s north during the Cold War, to the Air and Maritime Self-Defense Forces to better defend the Nansei island chain in the southwest and to strengthen Japan’s capacities in the maritime domain based on enhanced intelligence, surveillance and reconnaissance (ISR) capabilities and other advanced technologies. The NDPG also stressed the importance of “multilayered security cooperation” beginning with the U.S.-Japan alliance but extending to other partners including South Korea, Australia, India and ASEAN countries, as well as cooperation with the European Union and NATO on global security issues. The 2010 NDPG represents another incremental step forward in Japan’s defense posture. However, defense spending, unofficially capped at approximately 1 percent of GDP, continues to decline, meaning the SDF could struggle to resource this strategy.

Constraints on defense spending and sluggish economic growth would suggest that the SDF will focus increasingly on partnering with other militaries. In December 2011, the government took a pragmatic step in relaxing principles on arms exports to facilitate defense industrial cooperation with the United States and other countries. This will enable Japan to access the latest technology for much less than it would cost to develop indigenously.

There is an ongoing debate in Japan with respect to Article IX and whether it should be revised to reflect the changes in the international security environment that necessitate enhanced roles, missions and capabilities for the SDF. The legislative hurdles to such a change are substantial; revising the constitution requires a two-thirds majority in both houses of the Diet (parliament) and majority public support in a national referendum. More likely is a continued reinterpretation of Article IX to support new missions and a gradual movement toward exercising the right of collective self-defense, which has been another source of debate recently in the context of the U.S.-Japan alliance. For instance, Japanese lawmakers raised the hypothetical question of whether Japan could shoot down a North Korean missile headed for the United States. However, in a clear step toward collective self-defense, the SDF established its first joint operational command overseas in Djibouti last year to manage anti-piracy operations in the Gulf of Aden under rules of engagement that allow the use of force to defend non-Japanese vessels.

According to the 2010 NDPG, SDF assets are as follows: for the Ground Self-Defense Force, approximately 400 tanks, 400 artillery, eight divisions, six brigades, seven anti-aircraft artillery groups, one armored division and a readiness force. The Maritime Self-Defense Force has 48 destroyers, 22 submarines, approximately 150 combat aircraft, four escort flotillas, four fleet escort forces, six fleet submarine forces, one minesweeper flotilla and nine air squadrons. The Air Self-Defense Force has approximately 340 combat aircraft, 260 fighters, air warning and control units (four warning groups, 24 warning squadrons), fighter aircraft units (12 squadrons), an air reconnaissance unit (one squadron), air transport units (three squadrons), an aerial refueling/transport unit (one squadron), and surface-to-air-guided missile units (six groups). The SDF also has six Aegis-equipped destroyers capable of ballistic missile defense.

A cursory examination of Japan’s Ministry of Defense budget request for fiscal year 2012 sheds light on emphasized roles and procurement priorities for the SDF and its 247,000 personnel. Core functions to improve defense posture include intelligence, surveillance and reconnaissance, maritime patrol, air defense, response to ballistic missile attacks, transportation, and command, control and communications. Helicopter-carrying destroyers, conventionally powered attack submarines and fixed air-defense radar are procurement targets to improve warning and surveillance capabilities. The Type-88 surface-to-ship missile system, CH-47 transport helicopters and C-2 transportation aircraft are listed to enhance rapid deployment and response capabilities. Another priority is ballistic missile defense, with a procurement package of PAC-3 missiles, upgrades for Aegis destroyers and development in cooperation with the United States of an advanced interceptor missile (SM-3 Block IIA). The most publicized procurement decision this budget cycle was the selection of Lockheed Martin’s F-35 fifth-generation stealth fighter to improve air defense capabilities. The Ministry of Defense announced plans to by 42 F-35s with an initial set of four to be delivered by March 2017.

Strategic Priorities

The U.S.-Japan alliance will remain the cornerstone of Japanese foreign and defense policy, with continued emphasis on the Asia-Pacific in the context of the U.S. “pivot” rebalancing economic and strategic priorities toward the region. An impasse over the relocation of a U.S. Marine air base on Okinawa and occasional diplomatic challenges on issues such as Iran sanctions notwithstanding, the bilateral alliance is robust and will continue to influence Japan’s strategic trajectory.

Japan is extremely sensitive to developments on the Korean Peninsula and will work to reduce the threat posed by North Korea’s nuclear and missile programs. A close relationship with South Korea, though complicated by history and territorial disputes, is critical in this context. Trilateral dialogue with the United States is a useful vehicle in which to reaffirm a common approach to shared security concerns.

Japan will also continue to emphasize improved relations with China given the economic interdependence between the two nations, while hedging against an uncertain future with respect to Chinese military ambitions. Historical legacies, territorial disputes and differences pertaining to freedom of navigation and maritime security complicate diplomatic engagement. The challenge is to welcome the rise of China and encourage its development in a way that supports regional stability and embraces established norms of behavior.

Enhanced economic and defense cooperation with new partners such as Australia and India can facilitate opportunities to explore strategic convergences and enhance the capabilities of the SDF through training exercises. These partnerships and Japan’s relationship with South Korea may also prove significant in the context of the U.S. “pivot” to the region that is centered on coordination with like-minded states. Nevertheless, such coordination does not constitute a containment strategy, given the extent of economic interdependence with China and need not occur absent equally close engagement with Beijing on regional issues.

Active participation in the process of competitive trade liberalization in the Asia-Pacific region will enhance Japan’s economic competitiveness and should be a central element of its long-term growth strategy. Accession to the Trans-Pacific Partnership negotiations will ensure Japan’s role in setting high standards for trade and strengthening trans-Pacific economic architecture. APEC should also provide opportunities to share best practices and develop initiatives to enhance economic cooperation in the region.

Diplomatic engagement with Southeast Asia should constitute an important pillar of Japan’s foreign policy agenda given its history of support for economic development, active involvement in regional institutions and shared concerns about maritime security. Japan should play a leading role in shaping the institutional architecture of the region by continuing to engage ASEAN and participating in related gatherings including the ASEAN Regional Forum, ADMM+ and EAS.

Japan is also keen on assuming a leadership role in global institutions and will persist in its efforts to secure a permanent seat on the U.N. Security Council reflective of its financial contributions, which are second only to the United States, as well as its support for U.N. peacekeeping operations and its commitment to nonproliferation.

Energy security is perhaps the most pressing strategic priority for this resource-poor nation, especially with almost of all of its nuclear power plants shut down in the aftermath of the Fukushima Daiichi nuclear accident last year. Finding alternatives to nuclear energy, which constituted close to 30 percent of Japan’s electricity production, at reasonable cost and convincing the business community of a stable energy supply are monumental tasks critical to economic recovery and a sustainable growth strategy.

Conclusion

Japan’s strategic and diplomatic profile will continue to derive from its close alliance with the United States, its contributions to regional and global security, its active diplomatic engagement in the Asia-Pacific region, its commitment to the developing world and its leadership in global institutions that underpin the international order. Japan has a particularly central role to play in the articulation of rules and norms that will benefit the rising powers of the Asia-Pacific. The dispatch of the SDF far afield to countries such as Djibouti speaks to the evolution of Japanese defense policy and expectations of a global leadership role in the security realm. But the extent of Japan’s strategic influence will in large measure hinge on the prospects for sustainable economic growth that can support its security requirements and diplomatic priorities.

Nicholas Szechenyi is a senior fellow and deputy director of the Japan Chair at the Center for Strategic and International Studies (CSIS).

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