Japan Eases Restrictions on Military Exports in Abe Defense Push

Prime Minister Shinzo Abe’s cabinet passed new guidelines loosening Japan’s more than four-decade-old restrictions on foreign weapons sales as part of the premier’s push to bolster the country’s military.

The new rules continue to ban transfers of military material to countries involved in conflict and will be limited to cases that contribute to Japan’s security or to the “promotion of peace” and international cooperation, according to a document provided by the Foreign Ministry in advance of the decision. The changes will allow Japanese companies to more easily work with other nations on joint weapons programs.

“The Defense Ministry and the Self-Defense Forces will make more active contributions to peace and international security under the three principles on defense transfers,” Defense Minister Itsunori Onodera said today in a statement. “We will more actively cooperate on defense equipment and technology with our ally the U.S. and other countries to maintain regional peace and stability.”

Abe is seeking to boost Japan’s security capacity at a time of concern about China’s military aspirations and a territorial dispute over East China Sea islands. China has already criticized plans for Japanese weapons exports, after Japan’s first-ever National Security Strategy called in December for the country’s defense industry to be strengthened.

“The move is poised to further erode Japan’s pacifist image, intensify regional mistrust and escalate international conflicts,” a Feb. 28 editorial by the official Xinhua News Agency said.

Pacifist Constitution

The changes come against a broader backdrop of Abe’s efforts to widen Japan’s deployment abilities, calling for a reinterpretation of the country’s pacifist constitution to allow Japan to come to the aid of its allies. Abe has increased defense spending for the second year running and established a U.S.-style National Security Council.

Easing the rules may allow Japan to tap the growing demand for weapons in Asia that helped South Korea to boost arms exports to a record $3.4 billion last year, 14 times the 2006 level, according to the country’s Defense Acquisitions Program Administration. The surge benefited companies such as STX Offshore & Shipbuilding Co. and Korea Aerospace Industries. (047810)

In Japan, Mitsubishi Heavy Industries Ltd. (7011), Kawasaki Heavy Industries Ltd. (7012), Mitsubishi Electric Corp. (6503) and the Nippon Electric Company (6701) are the Ministry of Defense’s biggest contractors. Mitsubishi produces ships, submarines, tanks, aircraft and rockets, while Kawasaki has made fixed-winged maritime patrol planes, helicopters and jet engines. Mitsubishi Heavy is also involved in Lockheed Martin (LMT) Corp.’s F-35 Joint Strike Fighter.

Three Principles

A poll carried out by Kyodo on Feb. 22-23 found 67 percent of Japanese respondents opposed easing the curbs on weapons exports. The agency surveyed 1,011 people and did not give a margin of error.

The new rules on defense equipment transfers will replace the “three principles” on weapons exports drawn up in 1967, which banned exports to communist bloc countries, countries under United Nations embargo and those involved in international conflict. It was eventually expanded to become a virtual ban on almost all exports.

To contact the reporters on this story: Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net; Takashi Hirokawa in Tokyo at thirokawa@bloomberg.net

To contact the editors responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net Andrew Davis

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