Japan breaks pacifist mold, eyes big play in defence market

Japan, long celebrated for its pacifist stance, is now making a bold move into the global arms export arena.

After decades of focusing primarily on its own Self-Defense Forces, Japan is shifting gears to boost defense exports, signaling a major change in policy driven by rising security concerns and the need to strengthen international partnerships. This new direction marks a significant step for Japan as it seeks to rebuild its defense industry and deepen ties with allies in an increasingly complex geopolitical landscape, Caliber.Az reports per CNBC.

Earlier this month, Defense Minister Gen Nakatani said that boosting defense exports is a new priority—marking a significant policy shift from Japan’s traditional focus on equipping its own Self-Defense Forces (JSDF).

Prime Minister Shigeru Ishiba underscored this change by becoming the first sitting Japanese prime minister to attend DSEI Japan, the country’s largest defense exhibition. While global defense spending is rising, experts said that Japan’s move is driven more by pressing security concerns than by a desire to capitalize on the growing arms market.

Rintaro Inoue, research associate at Tokyo’s Institute of Geoeconomics, said the main goal is to deepen ties and improve interoperability with allies. “This rationale has been the main pillar after Prime Minister [Shinzo] Abe created the concept of ‘proactive contribution to peace’ in 2013 which aims to deepen cooperation with other Western countries in this area, and especially in security fields,” he explained. Abe had also led efforts to reinterpret Article 9 of Japan’s constitution, enabling the JSDF to play a more active international role.

Japan’s defense industrial base had been in “very poor conditions” before the government increased defense spending in 2022. Inoue said expanding exports is key to achieving economies of scale and sustaining domestic production. Historically, Japan has relied heavily on US weapons, such as F-35 fighter jets, rather than developing its own manufacturing.

Naoko Aoki, a RAND political scientist, noted Japanese defense firms faced limited domestic demand. “Even if the JSDF needed more of, for example munitions, these companies would not be eager to invest in new facilities... If there were more stable demand at a higher level, however, they can justify the investment,” she said.

In 2024, Japan’s arms exports were just 0.1 per cent of the global market by trend-indicator value (TIV), far behind neighbors South Korea and China. Veteran investor David Roche of Quantum Strategy sees strong growth potential, warning that “demand will exceed supply for a decade,” making domestic capacity critical.

Roche also cited US Defense Secretary Pete Hegseth’s recent remarks: “We ask — and indeed, we insist — that our allies and partners do their part on defense... NATO members are pledging to spend 5% of their GDP on defense, even Germany.” He added that Asian allies must increase defense spending amid growing threats, including North Korea.

Japan’s historic “Three Principles on Arms Exports” restricted weapons exports since 1967, with exceptions only for transfers to the US. These rules were loosened under Abe and further eased by former Prime Minister Fumio Kishida in 2023. Now, Japan can export licensed defense equipment produced domestically, such as Patriot missiles manufactured for the US.

With South Korea emerging as a major arms exporter, experts debate Japan’s competitive prospects. Roche believes Japan has the “knowledge, skills and technology” to succeed, but Inoue cautions, “I think it’s very difficult for Japan to once again focus into manufacturing jobs” due to demographic challenges.

Aoki emphasized regulatory hurdles remain: “Japan has the technical capacity to do many things,” but strict export controls mean exports will mainly serve to strengthen defense ties, especially with the US.

By Naila Huseynova