Japan Approves Record $58B Defense Budget to Deter China/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Japan’s Cabinet has approved a record $58 billion defense budget for 2026, boosting missile capabilities and unmanned systems to counter rising threats from China. The budget includes funding for advanced weaponry, international collaborations, and coastal defense initiatives. Prime Minister Takaichi pledges to meet spending targets while navigating increasing regional tensions.
Japan’s Record Defense Budget: Quick Looks
- Japan approves ¥9 trillion ($58B) defense budget for fiscal 2026
- Budget marks a 9.4% increase over the previous year
- Focus on long-range cruise missiles and unmanned drone defense systems
- First batch of upgraded Type-12 missiles to be deployed by March
- Coastal “SHIELD” system to include imported drones from Israel or Turkey
- Japan to co-develop fighter jets with UK and Italy by 2035
- China-Japan tensions grow over Taiwan and Pacific military activity
- Tokyo plans tax increases to fund military expansion amid demographic challenges
- Japan to hit 2% GDP defense spending goal by March 2026
Deep Look: Japan Approves Historic Defense Budget to Counter China’s Military Expansion
TOKYO (Dec. 26, 2025) — Japan’s Cabinet on Friday approved its largest-ever defense budget, exceeding 9 trillion yen ($58 billion) for fiscal year 2026. The move reflects Tokyo’s intent to boost military readiness in the face of rising threats from China and a rapidly evolving security environment in the Indo-Pacific.
The record-breaking budget — a 9.4% jump from 2025 — is the latest step in Japan’s five-year initiative to double defense spending to 2% of GDP, aligning more closely with NATO standards. Prime Minister Sanae Takaichi’s administration, under growing U.S. pressure, has vowed to reach this target by March 2026, two years ahead of schedule.
Defense Minister: “Minimum Needed” for Today’s Threats
Defense Minister Shinjiro Koizumi defended the increase, stating,
“It is the minimum needed as Japan faces the severest and most complex security environment in the postwar era.”
Despite the expanded budget and offensive upgrades, Koizumi emphasized that Japan remains committed to peace, saying,
“It does not change our path as a peace-loving nation.”
Focus Areas: Missiles, Unmanned Weapons, and Coastal Shield
A key feature of the 2026 plan is bolstering strike-back capabilities and coastal defense:
- ¥970 billion ($6.2 billion) allocated for long-range missile systems, including the Type-12 surface-to-ship missiles, capable of reaching up to 1,000 km (620 miles).
- The first Type-12 batch will be deployed by March 2026 in Kumamoto Prefecture, a year ahead of schedule.
- ¥100 billion ($640 million) will go toward deploying massive unmanned aerial, surface, and underwater drones under a new defense initiative called SHIELD, expected to be operational by March 2028.
To overcome challenges posed by an aging population and recruitment shortfalls in the Self-Defense Forces, Japan is increasingly investing in unmanned systems, likely sourcing initial drone models from Turkey or Israel.
Regional Tensions Escalate Over China and Taiwan
Japan’s budget comes amid rising military tension with China, especially over the Taiwan Strait. In November, Prime Minister Takaichi stated that Japan could intervene militarily if China takes action against Taiwan, triggering backlash from Beijing.
The strain intensified this month when:
- Chinese aircraft carriers conducted military drills near southwestern Japan,
- One Chinese aircraft locked radar on a Japanese plane, prompting formal protests from Tokyo.
- Chinese military presence near Iwo Jima and disputed areas in the East China Sea has also grown.
In response, Japan’s Defense Ministry plans to launch a new office dedicated to analyzing China’s Pacific activities, including strategies, equipment, and operations.
Joint Development and Arms Industry Boost
In addition to domestic defense improvements, Japan is seeking to strengthen its global arms partnerships:
- ¥160 billion ($1 billion) is allocated to the joint development of a next-generation fighter jet with Britain and Italy, scheduled for deployment in 2035.
- The aircraft will be assisted by AI-powered drones, showcasing Japan’s commitment to future warfare technologies.
The defense sector also received a major boost when Australia selected Mitsubishi Heavy Industries to upgrade its Mogami-class frigates, replacing its older ANZAC-class fleet.
To support such developments, nearly ¥10 billion ($64 million) will be invested in shoring up the defense industry base and expanding foreign arms sales.
Can Japan Sustain This Level of Defense Spending?
While the Defense Ministry celebrates hitting the 2% GDP goal, long-term sustainability remains a challenge:
- The overall national budget for 2026 is set at ¥122.3 trillion ($784 billion).
- Future defense growth may be constrained by demographic issues, rising debt, and political resistance.
- Funding will rely on a mix of corporate, tobacco, and soon-to-be-implemented income tax hikes (starting in 2027).
China’s Foreign Ministry criticized Japan’s direction, with spokesperson Lin Jian stating:
“Japan is deviating from the path of peaceful development… and is moving further and further in a dangerous direction.”
Despite external criticism, the Takaichi administration maintains that its military trajectory is defensive in nature, driven by China’s increasing aggression and Japan’s regional vulnerability.
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