Japan unveils unprecedented $320b military build-up

This handout photo taken and released by Japan's Ministry of Defense on Sept 28, 2022 shows Japanese F-2 fighter jets flying with German Air Force Eurofighters past Mount Fuji during German-Japan joint military drills aimed at strengthening defense cooperation between the two nations. (HANDOUT / JAPAN'S MINISTRY OF DEFENSE / AFP)

TOKYO – Japan said on Friday it would begin a once-unthinkable $320 billion military build-up that will arm it with missiles and ready it for a sustained conflict as regional tensions stoke war fears.

Prime Minister Fumio Kishida's government worries that the conflict in Ukraine has set a precedent that will disrupt supplies of advanced semiconductors and put a potential stranglehold on sea lanes that supply Middle East oil.

In the sweeping five-year plan, which is pacifist Japan's biggest military build-up since World War Two, the government said it would also stockpile spare parts and other munitions, expand transport capacity and develop cyber warfare capabilities

“This is setting a new heading for Japan. If appropriately executed, the Self Defense Forces will be a real, world-class effective force,” said Yoji Koda, a former Maritime Self Defense Force admiral, who commanded the Japanese fleet in 2008.

In the sweeping five-year plan, which is pacifist Japan's biggest military build-up since World War Two, the government said it would also stockpile spare parts and other munitions, expand transport capacity and develop cyber warfare capabilities.

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A separate national security strategy document promised close cooperation with the United States and other like-minded nations to deter threats to the established international order.

"Japan is making a late start, it is like we are 200 meters behind in a 400-meter sprint," said Toshimichi Nagaiwa, a retired Air Self-Defense Force general. 

Kishida's plan will double defense outlays to about 2 percent of gross domestic product over five years, blowing past a self-imposed 1 percent spending limit that has been in place since 1976.

It will increase the defense ministry's budget to around a tenth of all public spending at current levels, and will make Japan the world's third-biggest military spender, based on current budgets.

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Members of the Japanese Self-Defense Force Amphibious Rapid Deployment Brigade hold positions while a US Marine Corps MV-22 Osprey tilt-rotor aircraft lands during a joint exercise between the two services at the Higashifuji training area in Gotemba, Shizuoka Prefecture on March 15, 2022. (CHARLY TRIBALLEAU / AFP)

Prime Minister Fumio Kishida's plan will increase the defense ministry's budget to around a tenth of all public spending at current levels, and will make Japan the world's third-biggest military spender, based on current budgets

That splurge will provide work to Japanese military equipment makers such as Mitsubishi Heavy Industries (MHI), which is expected to lead development of three of the longer-range missiles that will be part of Japan's new missile force.

MHI will also build Japan's next jet fighter alongside BAE Systems PLC and Leonardo SPA in a joint project between Japan, Britain and Italy announced last week.

Tokyo allocated $5.6 billion for that in the five-year defense program.

Foreign companies will also benefit. Japan says it wants ship-launched US Tomahawk cruise missiles made by Raytheon Technologies to be part of its new deterrent force.

READ MORE: Japan ruling party agrees on tax hike to boost defense, with delay

To pay for the military build-up, Kishida's ruling bloc earlier on Friday said it will raise tobacco, corporate and disaster-reconstruction income taxes. 

But, with opposition to tax hikes within his ruling Liberal Democratic party still strong, the Japanese leader has yet to say when he will implement those higher rates.