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SECURITY

Japan’s host nation support increased by 9% in 7 years

Japan bears part of the costs of stationing U.S. Forces in Japan (USFJ). This is known as “host nation support” or the “consideration budget,” and it covers such expenses as the utilities and the labor costs of Japanese employees working at base facilities. After peaking at 275.6 billion yen (on an expenditure basis) in FY1999, HNS was on a decline. After bottoming out in FY2014, the figure began to rise again.

 

The HNS for the FY2021 budget was 201.7 billion yen, a 9% increase compared with FY2014.

 

Japan started to pay a share of the costs of stationing the USFJ in FY1978. Japan spent 6.2 billion yen that fiscal year in response to the deteriorating fiscal situation in the U.S. and the forex situation where the yen was appreciating. At the time, there was criticism in the U.S. that Japan “is getting a free ride under the security treaty.”

 

Then-Defense Agency Director-General Kanemaru Shin commented that “Japan might as well be considerate” of the U.S. This is the origin of the term “consideration budget,” as HNS is commonly known.

 

Japan gradually came to bear a wider range of costs under HNS. Utilities and labor costs, including the base salaries of Japanese base employees, were added.

 

As Japan’s financial situation worsened after the bubble economy burst, HNS began to shrink in the 2000s, falling to 184.8 billion yen in FY2014.

 

One of the reasons for the upward trend since FY2015 is China’s military buildup. The U.S. has taken a stronger stance and has asked its allies to shoulder a greater burden.

 

The amount of HNS is usually determined based on the Special Measures Agreement (SMA), which is renegotiated every five years. The most recent deadline was March 2021. Japan postponed renegotiating the SMA because the Trump administration was demanding a significant increase.

 

After the Biden administration came into office with its emphasis on alliances, a tentative agreement was reached to keep HNS for FY2021 at about the same level as the previous fiscal year. The HNS for FY2022 and beyond will be discussed afresh.

 

Japan’s share of the costs of stationing U.S. forces is said to be higher than that of other U.S. allies. According to a Ministry of Defense estimate, Japan bore 86% of total stationing costs in FY2015. Of the 221 billion yen in total stationing costs, Japan bore 191 billion yen.

 

In 2004, the U.S. Department of Defense announced that Japan’s share of the burden was 74.5%. South Korea’s 40%, and Germany’s 32.6%.

 

In addition to the “consideration budget,” Japan also earmarked 204.4 billion yen in FY2021 for expenses related to the realignment of U.S. forces. This includes the cost of relocating the U.S. Marines currently in Okinawa to Guam.

 

The Japanese government hopes that President Biden will not ask for as much of an increase in HNS as the Trump administration did.

 

As concerns are rising about the possibility of a contingency in the Taiwan Strait, however, the U.S. will continue to expect Japan to play a new role. Sharing the costs of stationing the U.S. military in Japan is part of that role. Japan and the U.S. will need to work out a compromise.

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