The administration of Prime Minister Shinzo Abe appears to be substantially increasing the defense budget in line with a revision to the National Defense Program Guidelines.
The defense budget request for fiscal 2019 reached nearly 5.3 trillion yen, up 2.1 percent from this fiscal year.
But the figure does not include an estimated 220 billion yen-plus linked to the reorganization of U.S. troops stationed in Japan, an item included in an average year's budget but whose amounts are not specified in this particular request. When this cost is added to the total, the nation's real defense budget requested will amount to more than 5.5 trillion yen -- making for an annual growth rate of more than 6 percent.
Under the Abe administration, defense spending has grown for six consecutive years. Still, the year-on-year increase was mainly below 2 percent, with 2.8 percent at the highest. The budget request for the next fiscal year makes an exceptionally high jump, and the administration has attempted to hide it by obscuring the amount of a specific item.
The government will complete the review the defense guidelines at the end of this year, and will decide on a five-year Medium Term Defense Program starting next fiscal year based on those revised guidelines.
Last week, the government organized the first meeting of experts to discuss the revision. The talks will proceed along with budget negotiations between the Ministry of Defense and the Ministry of Finance; however, increasing the defense budget already appears to be a set course.
The budget request includes 235.2 billion yen for the introduction of the Aegis Ashore ballistic missile defense system, which is likely to become the main pillar of the new defense guidelines. Much of the money will be used to pay for foreign military assistance (FMS) contracts that will be signed between Japan and the U.S.
FMS contracts, despite the criticism they face for the high price tags set by Washington, have been on the rise in recent years. New FMS contracts in the budget request for fiscal 2019 have reached 691.7 billion yen, an almost 70 percent hike from the current fiscal year's 410.2 billion yen.
One has to wonder if it was necessary for the Aegis Ashore contract to be decided before the defense guideline review, as it may take six years for the system to be deployed. The demand from the administration of U.S. President Donald Trump to buy large amounts of defense equipment appears to be behind Tokyo's decision to go ahead with the hefty contract.
Japan's defense spending has long been under 1 percent of the nation's gross domestic product, but the ratio may go beyond the de-facto ceiling starting from the next fiscal year.
In May, the ruling Liberal Democratic Party proposed allocating more funds to the defense budget, eyeing the fact that President Trump is demanding that European countries increase their defense spending to 2 percent of their respective GDPs. The proposals included acquiring the capacity to attack enemy bases, as well as the conversion of helicopter destroyers into aircraft careers, and these ideas are likely to be discussed during review of the defense guidelines.
It is dangerous to increase defense budget requests to take steps toward changing the country's defense policy. Instead, a cautious discussion on the subject must be sought.