Executive Summary
Japan’s recent defense export reform marks a major departure from its postwar antimilitary posture and signals a broader effort to strengthen the country’s defense-industrial base amid rising regional tensions. By easing restrictions on the sale of military equipment to allies, the Takaichi government seeks to expand Japan’s strategic partnerships, reinforce deterrence, and reduce the dependence of domestic defense firms on limited internal demand (The Mainichi, 2026). The policy may support Japan’s military industry, especially as defense spending has grown around 60% in the last four years (Johnstone and Rubinstein, 2026). However, the reform alone is insufficient to guarantee industrial or strategic success and may intensify tensions with China.
Introduction
Japan’s Prime Minister, Sanae Takaichi, announced changes to the policy governing defense exports, which eliminated restrictions on sales of military equipment to Japan’s allies (Dominguez and Johnson, 2026). In light of recent tensions with China, this measure aims to strengthen diplomatic and military ties with allies through the provision of weapons in order to promote regional deterrence. The measure also has domestic motivations. Takaichi’s government intends to stimulate the domestic arms industry through exports and ensure that the country has internal resilience for a possible conflict in the region. Although these changes may benefit Japan’s domestic military industry globally and in its strategic objectives, the measure by itself is insufficient. The achievement of these objectives also depends on how Japanese and global stakeholders will interact and on the continuity of government incentives for the industry.
The new policy divides products into “weapons,” or lethal systems (warships, tanks and missiles), and “nonweapons,” or nonlethal equipment (radars and protective gear); so exports of non-weapons face no restrictions, while those of weapons are limited to countries that have signed agreements with Japan on protecting classified information related to defense equipment and technology (The Mainichi, 2026). This implies that Japan can now export lethal weapons to 17 countries, as long as they are not actively engaged in conflict, with an exception for countries that have defense pacts with Japan (Johnstone and Rubinstein, 2026).
Discussion
Originating from the political limits imposed by Article 9 of the Constitution (House of Representatives, Japan, 1946), Japan’s antimilitary approach was broadened in 1976, making arms transfers politically taboo, limiting growth and innovation. Tokyo began to incrementally loosen this framework, first allowing defense technology transfers to Washington in 1983 and later adopting more substantial changes in response to regional threats from China and North Korea (Johnstone and Rubinstein, 2026). Shinzo Abe’s 2014 Three Principles on Transfers of Defense Equipment and Technology represented a more formal shift, but the process remained cautious (Ministry of Foreign Affairs of Japan, 2023). Subsequent reforms allowed license-produced items to be returned to the US, and a 2023 policy statement authorized transfers of licensed defense equipment to countries of origin (Johnstone and Rubinstein, 2026).
As this policy favors the development of Japan’s domestic military industry, the measure also contributes to greater tensions in the region. As pointed out by Chief Cabinet Secretary Minoru Kihara, the expansion of defense exports allows companies that produce for the military sector to benefit from the economies of scale tied to greater external demand, since this industry currently depends on domestic demand (Nikkei Asia, 2026). Moreover, the expansion of security trade ties with other countries allows Japan to access new technologies while diversifying its military ties. However, Japan’s distancing from the pacifist policy adopted in recent decades occurs in response to rising tensions in Asia, so the Japanese government’s greater engagement in the military area may fuel these tensions, not only with China, but also with neighboring countries. Public concern remains significant, as 49% of respondents oppose the changes and only 40% support the new policy, partly due to fears that Japan could become involved in unintended conflicts (Yomiuri Shimbun, 2026).
In order for the expansion of military exports to generate a sustainable positive effect on Japan’s military industry, it will be necessary for domestic and international stakeholders to engage with the initiative, as well as for the Japanese government to continue providing incentives. Currently, there are no Japanese companies whose main activity is focused on the arms industry (Johnstone and Rubinstein, 2026), meaning that these manufacturers need to be willing to compete in the international market while foreign players also become involved with these companies. Japanese shipbuilders face labor shortages and slowing production rates due to the country’s demographic decline (Johnstone and Rubinstein, 2026). The Japanese government will have to offer incentives for the stabilization of the workforce and for companies, which currently do not have significant international experience in the security market, to make investments in the sector.
It is also relevant to understand the implications of this expansion for the relationship between Japan and China. The Chinese government stated that it is “seriously concerned” about “Japan’s reckless militarisation” (BBC News, 2026). Although Taiwan does not fall within the requirements that allow Japan to export its weapons, Takaichi understands that a naval blockade around Taiwan constitutes a “survival-threatening situation” (Dominguez and Johnson, 2026). This may provide the necessary legal basis for Japan, in a context of Chinese advances against Taiwan, to provide weapons and logistical support to Taiwan. Takaichi’s victory in the Japanese parliament, combined with the likely escalation of tensions in the region, makes it more likely that, in the medium-to-long term, Japan will expand its military ties with Taiwan.
Conclusion
Japan’s defense export reform represents a significant shift from its postwar antimilitary posture toward a more active defense-industrial and strategic policy. With Japanese defense spending having grown (Johnstone and Rubinstein, 2026), and with further increases likely, the reform may help expand economies of scale, strengthen domestic production, and support new joint development projects. Yet this process also carries strategic and political risks. Regionally, broader arms exports may intensify tensions with China, particularly over Taiwan, while domestically, the government must address public skepticism, labor constraints, and the limited international experience of Japanese defense firms.
Bibliography
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- House of Representatives, Japan (1946) ‘The Constitution of Japan’. Available at: https://www.shugiin.go.jp/internet/itdb_english.nsf/html/statics/english/constitution_e.htm