In November, soon after taking office, Japanese Prime Minister Sanae Takaichi told parliament that a Chinese assault on Taiwan could constitute an existential threat to Japan and could warrant a military response. To China, which sees any commitment to supporting Taiwan as a provocation, these were fighting words. In response, Beijing stepped up military exercises near Japan, halted the imports of Japanese seafood, banned exports of dual-use goods—products that can be used for civilian and military purposes—to Japan, and advised its citizens not to travel there.
Takaichi’s comments are all the more worrying for China because Japan is undergoing a profound shift. Over the past four years, Tokyo has prepared itself to counter China’s coercive behavior by splurging on its armed forces, protecting its supply chains, and becoming more assertive in its neighborhood.
Washington has welcomed these moves—but its support of Tokyo in light of Beijing’s recent pressure campaign has been tepid to nonexistent. That is a mistake. The United States should capitalize on Japan’s newfound muscularity by building its Indo-Pacific strategy around a revitalized U.S.-Japanese alliance. The two countries should harmonize their defenses and, along with its regional partners Australia and India, coordinate industrial policy in sensitive sectors. If the United States fails to take advantage of this moment or sees Japan’s strength as a reason to pull away from the region, Washington will be in a much worse position to deter China from taking Taiwan or otherwise wreaking havoc in the Indo-Pacific.
FROM DEFENSE TO OFFENSE
Tokyo began recalibrating its role in the world under the late Prime Minister Shinzo Abe, who led Japan in 2006–7 and 2012–20. In response to an increasingly assertive China, which launched frequent incursions in and around Japan’s Senkaku Islands (known in China as the Diaoyu Islands), Abe loosened constitutional constraints on Japan’s armed forces and began building up Japan’s military might. (Previously, Japan subscribed to the idea that it should possess only the minimum amount of force to repel an invasion.) In addition, he promoted the idea of building a free and open Indo-Pacific, which positioned Japan at the center of efforts to prevent the region from falling under hegemonic Chinese influence.
Abe also revitalized the Quad—a diplomatic partnership among Australia, India, Japan, and the United States—to coordinate security, technology, and economic policy. Abe did more than any other leader to encourage the United States and other like-minded countries to take a more assertive stance against an aggrandizing China. He also made clear that Taiwan’s security is Japan’s security.
Russia’s full-scale invasion of Ukraine in February 2022 accelerated Japan’s transformation into a modern military power. Then Prime Minister Fumio Kishida warned that “Ukraine today may be East Asia tomorrow,” summing up the fear that China might take a page from Russia’s playbook and invade its neighbors. That year, Japan committed to doubling its defense spending to two percent of GDP by 2027 and explicitly and unequivocally identified China as its greatest threat. Tokyo also started acquiring counterstrike capabilities to target an adversary’s missile launch sites, which, just a few years before, was considered unthinkable for fear of upsetting China and violating a self-imposed restriction on weapons that can be used offensively. No longer would Japan’s military, the Japan Self-Defense Forces, remain in a purely defensive crouch.
The success of Japan’s fortification risks encouraging U.S. retrenchment.
Today, Tokyo is preparing to put into service hypersonic weapons that can disrupt North Korean and Chinese air and missile defenses, and deploying Tomahawk cruise missiles, Joint Strike Missiles, and domestically upgraded Type 12 surface-to-ship missiles to improve its ability to launch counterstrikes. Tokyo is also investing heavily in space domain awareness—the ability to track satellites and detect threats in orbit—committing $3.5 billion in 2025, up tenfold from 2020. In addition, Japan is hardening its position on its southwest islands, which are close to Taiwan. (One of them, Yonaguni Island, is just 68 miles away.)
Moreover, Japan has been strengthening its regional defense ties to further solidify its position against China. It has helped other countries in the region, including Bangladesh and the Philippines, defend against Chinese incursions. Tokyo, for instance, has provided the Philippines with an air surveillance radar system and 12 of its 18 coast guard vessels. Japan has also loosened its defense export rules so it can more easily share technology with its allies. In 2023, it signed an agreement with Italy and the United Kingdom to jointly produce a fighter jet. And in 2025, Australia announced it would buy 11 Mogami-class stealth frigates from Japan for $6.5 billion—Japan’s biggest defense export deal yet.
Equally significant has been Tokyo’s investment in collective defense arrangements. Over the past five years, Japan has inked agreements with Australia, the Philippines, and the United Kingdom that expand opportunities for joint training, resource pooling, shared logistics, and reciprocal access to bases. These are the building blocks of a NATO-like system in the Indo-Pacific.
GOING ALL IN
Japan is now more capable today than it has been at any point since the end of World War II. Yet it faces a paradox: the success of its fortification risks encouraging U.S. retrenchment. American policymakers and strategists who advocate foreign policy restraint may argue that with a more capable Japan, the United States can do less in the Indo-Pacific. But the opposite is true.
Japan’s new military posture offers the United States a rare gift: a fully committed ally willing to act as the forward anchor of regional collective defense. Washington should meet this moment by strengthening its defense cooperation with Japan. Deterring China will demand an alliance architecture built around combined planning, interoperable forces, and integrated economic security policy. Geography works against U.S. power projection: if the United States were to go to war with China over Taiwan, the logistical strain on U.S. forces would be immense. Washington would need to work with its regional allies to station its troops and equipment close to the action.
The United States and Japan have been collaborating more on defense over the past several years but they need to go further. In 2025, Japan launched its Joint Operations Command, which integrates the three branches of its armed forces. And Washington and Tokyo have begun upgrading U.S. Forces Japan, which oversees American troops in the country, from an administrative body to a joint force headquarters. But the two allies still don’t have a body with the operational authority and structure to coordinate U.S. and Japanese forces in a crisis. The United States should place a senior officer in Tokyo—under the authority of the Indo-Pacific combatant commander—to make quick decisions alongside Japan’s Joint Operations Command. Over time, the United States and Japan should work toward a truly combined command like U.S. Forces Korea. Otherwise, if U.S. and Japanese troops come up against a common enemy, they will be fighting in parallel, leading to inefficiencies and, potentially, accidents.
The United States and Japan must also integrate their missile defense systems, including fusing sensors between Aegis ships, ground-based interceptors, and space-based early warning systems to create a seamless defensive umbrella across the so-called first island chain, which stretches from Japan to the Philippines and separates China from the Pacific Ocean.
Beyond command and missile defense integration, the United States and Japan need to together produce critical arms on Japanese soil. Today, the United States stations precision-guided munitions, air defense interceptors, and antiship missiles in Japan. That’s a good start, but those stocks would quickly run out in the event of a war with China. Washington must leverage Japan’s advanced manufacturing base, which already produces Patriot missiles, SM-3 interceptors, and Type 12 missiles, to jointly make SM-6 multimission missiles and AMRAAM air-to-air missiles, which are precise and long-range.
CHINA-PROOFING THE ECONOMY
In addition to improving its hard power, Japan has been preparing itself to better withstand Chinese economic coercion. Through its industrial policy, Beijing has come to dominate manufacturing in batteries, drones, and legacy chips, and it exploits its control of chokepoints over the economy, such as its near monopoly over the processing of critical minerals such as gallium to its advantage. Tokyo learned the risks of relying too heavily on China earlier than most. In 2010, after Japan detained a Chinese fishing captain who rammed a Japanese coast guard vessel near the Diaoyu/Senkaku Islands, Beijing retaliated by cutting off its exports of rare earths. Japanese industry was jolted, and the episode became a case study in China’s willingness to weaponize interdependence.
Almost a decade later, Tokyo established the Council for the Promotion of Economic Security, a government body that coordinates defensive economic policy, and passed the Economic Security Promotion Act to ensure stable supplies of critical goods, protect essential infrastructure, develop vital technologies, and safeguard sensitive intellectual property. In particular, Japan has upgraded its domestic chip industry. Tokyo, for instance, allocated $6.9 billion for a plant for Taiwan Semiconductor Manufacturing Company, the world’s leading semiconductor manufacturer, in Kyushu. And it has poured over $10 billion into Rapidus, a chip-making startup and Japan’s most ambitious, and risky, bet on technological sovereignty since the 1980s. Founded by eight major Japanese companies, including Toyota and Sony, Rapidus aims to mass produce two-nanometer chips by 2027, bringing Japan back to the cutting edge of semiconductor manufacturing after falling two decades behind.
At the same time, Japan has gone on the economic offensive against Beijing. It has joined the United States and Europe in restricting exports of semiconductor manufacturing equipment to China. Tokyo has also curbed Chinese investment in sensitive Japanese technologies. The combined effect has been to deny Chinese firms the specialized tools and intellectual property needed to make high-end chips. And crucially, Japan imposed sanctions on Russia outside a UN mandate—a notable departure from its historically cautious approach. It is clear that Tokyo is prepared to meet aggression with tough economic action.
Still, there is even more that Japan can do to improve its economic security, such as protecting its pharmaceutical supply chains. China dominates the global production of essential medicines, including breakthrough drugs, and controls many of the world’s key pharmaceutical ingredients, giving it massive leverage over the public health of Japan and its allies. Tokyo and Washington should coordinate on pharmaceutical security by mapping supply chain dependencies, investing in alternative manufacturing capacity, and cracking down against unauthorized distribution networks that provide Beijing with backdoors to manipulate supply volumes and degrade drug quality.
STRENGTHEN YOUR QUADS
Protecting the region from China’s economic and military dominance must ultimately involve coordination among all four members of the Quad. An allied response to Chinese industrial policy cannot simply subsidize domestic production in each country, which would lead to inefficient duplication and fail to create a combined market large enough to compete with the scale of China’s state-led economy. Instead, Australia, India, and the United States can work with Japan to build on Tokyo’s manufacturing leadership.
Japan has a history of transferring its manufacturing excellence to other countries. In the 1980s, when Japanese automakers established so-called transplant factories in the United States, they did more than just build cars—they transformed American manufacturing culture. A joint venture between Toyota and General Motors in Fremont, California, took a failed GM plant with abysmal productivity and combative labor relations and turned it into a model of efficiency within a year. Toyota sent hundreds of U.S. workers to Japan for intense training, then embedded Japanese managers as on-site mentors who worked side by side with their American counterparts. The transformation was remarkable: the same workforce, using similar equipment, achieved Japanese-level quality and productivity.
Today, the Quad should apply this model to the production of advanced batteries, semiconductor manufacturing equipment, aerospace and hypersonic materials, and precision robots. Japan, for instance, produces 45 percent of the world’s industrial robots. Its expertise could dramatically improve manufacturing productivity across Quad countries. And with Australia’s critical minerals, India’s rare-earth processing capabilities, Japan’s manufacturing precision, and the United States’ research and development and market scale, each member of the Quad brings something the rest need. By sharing knowledge and their respective domestic advantages, Quad members can genuinely increase their productivity, not just rest on subsidies.
Once these countries have built up their capacity, they should, through a series of bilateral trade agreements or “minilateral” partnerships, finally cut China out of critical supply chains in pharmaceuticals, critical minerals, drones, and legacy chips. The end result would be a trading system protected from China’s economic coercion. To be sure, excluding China would be costly. It remains the largest trade partner for Australia, Japan, and the United States. But by diverting trade flows toward one another, Quad members can ditch the vulnerability of the Chinese market for the collective security of its most reliable partners.
Cutting China out, as painful as it would be, would simply head off the inevitable. For at least two decades, Beijing has systematically squeezed Australian, Indian, Japanese, and U.S. companies out of its market when they are no longer needed for its industrial plans. If Japan took the lead on this reorientation, it could at least control some aspects of how the decoupling process unfolds.
STEPPING UP, NOT STEPPING BACK
Beijing’s campaign to manufacture political controversy over Takaichi’s Taiwan comments reflects a broader objective: to intimidate Japanese policymakers, divide Japan’s governing coalition, and deter other supporters of Taiwan from speaking out. Chinese leaders understand that the U.S.-Japanese alliance represents the single biggest obstacle to their ambitions for regional primacy. A Japan that is economically resilient, diplomatically active, and militarily capable undermines Beijing’s plan to isolate Taiwan, coerce its neighbors, and raise the costs of U.S. engagement.
The United States’ faint support of Japan in its spat with China undermines deterrence in the western Pacific. The United States should stand with its ally by endorsing Takaichi’s comments about the existential nature of a Taiwan crisis for Japan and other allies. Washington has an interest in fostering a broad coalition that speaks out against Chinese aggression toward Taiwan because China is more likely to be deterred from attacking the island if it believes many countries will rise in opposition. Silence, by contrast, signals to Beijing that it can peel off U.S. allies one by one through economic pressure—and that Washington will not defend those who call out China’s behavior.
The United States and Japan stand at a pivotal juncture. As Tokyo continues to take bold steps to prepare for an era of prolonged confrontation with China, Washington’s commitment is wavering. Tokyo has done the hard part. Now it is time for Washington to step up. If it doesn’t, it will prove Beijing right—that the United States’ alliances are temporary, its promises are hollow, and its power is in decline.
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