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SECURITY

LDP proposes to increase Defense budget to “2% of GDP”

  • May 25, 2018
  • , Nikkei , p. 4
  • JMH Translation

At a meeting of senior officials held on May 24, the Research Commission on National Security of the Liberal Democratic Party (LDP) compiled a draft proposal for the National Defense Program Guidelines and the Medium Term Defense Program to be reviewed by the government at the end of this year. As a reference for securing the future defense budget, the commission will clearly indicate “2% of the gross domestic product (GDP)” – the target of the North Atlantic Treaty Organization – in the proposal. This target has little chance of being adopted, but the security situation is growing increasingly severe on account of China’s military buildup. The commission intends to request the government increase defense spending by using its proposal as leverage.

 

The draft proposal will be presented at a meeting of the Research Commission on National Security on May 25 and officially finalized within the month.

 

Japan has made it a rule to keep its defense spending within 1% of GDP. The fiscal 2018 defense budget was 5.1911 trillion yen. If it is increased to 2% of GDP, the amount will be as much as 10 trillion yen.

 

A defense budget within 1% of GDP is low  compared with other major countries. For example, U.S. defense spending for FY2016 was 3% of GDP, while the figure for Russia was 4.8%; for the UK, around 2%; and for France, around 2%. China claimed its defense spending was 1.3% of GDP, but some experts estimate that the actual defense budget was twice the announced figure. 

 

Some LDP lawmakers involved in defense matters question the 1% restriction, saying, “The criterion of 1% of GDP for spending on defense prevents increases in the defense budget.

 

With the increase in social security costs in conjunction with the aging population, Japan faces a difficult financial situation. Under the circumstances, voices that “2% of GDP is not a realistic figure” are persistently heard within the government and ruling parties. For this reason, the latest draft proposal only referred to 2% of GDP as a “reference value” by citing NATO’s target but not calling it a target figure for Japan.

 

In recent years, in response to China’s maritime push and North Korea’s nuclear and missile development, the government has increased its defense spending. The defense budget is earmarked according to the Midterm Defense Program, which is reviewed every five years. Under the midterm program for FY2014 to FY2018, an annual average increase of 0.8% was used as a rough criterion for defense-related expenditures except costs for the realignment of U.S. forces. With regard to the next Midterm Defense Program for FY2019 and thereafter, voices that a “further increase is needed” are heard within the defense ministry.

 

Major countries’ defense spending and its percent of GDP in FY2016

 

Defense Spending

(hundred million dollars)

Percent of GDP

Japan

485

0.9

U.S.

5,654

3

UK

499

2.2

Germany

440

1.2

France

496

1.8

Russia

1,595

4.8

China

2,747

1.3

(Note) Source: Defense Ministry data

 

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