On Oct. 1, 2020, the Acquisition, Technology & Logistics Agency (ATLA) entered its fifth year. This agency serves as the command center for the vehicles, aircraft, artillery, and other “weapons” used by the Self-Defense Forces (SDF). ATLA was set up with the mandate to effectively develop exports, cut costs, conduct research and development, and strategically manage defense equipment based on the needs of the SDF. Several separate units within the Ministry of Defense (MOD) were integrated to form ATLA. There has only been one case of finished product exports so far. The system of procuring expensive defense equipment from the U.S. has been retained even though it strains Japan’s defense budget. It is necessary to let go of this system in order to adapt to the changing security environment.
Under the mantra of “proactive pacifism,” former Prime Minister Shinzo Abe eased the “three principles on arms exports” in April 2014. These principles were one of the pillars of Japan’s postwar security policy. The new “Three Principles on the Transfer of Defense Equipment” aims at enhancing Japan’s influence in the global community through the expansion of exports. ATLA’s primary objective since its launch has been the export of defense equipment, something which the premier himself has spearheaded, but ATLA has struggled in this area. Some have pointed out that Japan’s defense industry lacks a clear export policy and negotiation experience compared with that in other nations.
In reference to a joint submarine development project with Australia, which was dubbed a “centerpiece” of the new Three Principles, a MOD insider comments with a sigh that “[ATLA] could not compete with its European counterparts, which are familiar with exporting.” Japan was widely viewed to have an advantage in the project, because of the close relationship then Prime Minister Abe shared with then Prime Minister Tony Abbott. Abbott later stepped down, however, and in April 2016, Australia selected a French company that proposed a product with advanced stealth technology and offered to construct the submarine in Australia.
An ATLA official gives the following reason for the agency’s struggling exports: “Japan’s defense industry is tailored to the SDF and lacks variety in its defense equipment lineup, while defense companies in the U.S. and Europe can respond to a wide range of needs.”
It currently looks promising that ATLA will export the Air Self-Defense Force’s state-of-the-art C2 transport aircraft to the United Arab Emirates (UAE). In June 2020, then Defense Minister Taro Kono boarded the C2 aircraft in a sales promotion effort. ATLA will consign market research to a civilian company with sights set on exporting equipment to Vietnam, Indonesia, Malaysia, and India.
A top MOD official criticized ATLA for “haphazardly grabbing at anything that might result in a sale” and said the “agency lacks a well-thought-out policy on what equipment it wants to sell and to whom.” The official also said that “a sale of a good-as-new used radar is better than nothing, but [ATLA’s] original intent was to export large items such as submarines. The loss of the Australia project has had adverse effects on the agency.” (Abridged)