TOKYO — Japan’s Defense Ministry on Friday requested a record 8.5 trillion yen budget for the next fiscal year to strengthen its defense capabilities on its southwestern islands against the growing threat from China. The budget focuses on unmanned weapons and artificial intelligence (AI) to offset the declining number of servicemembers due to the country’s shrinking population.
This budget request for 2025 is part of Japan’s rapid five-year military buildup plan under the government’s ongoing security strategy. Japan aims to allocate 43 trillion yen by 2027 to double its annual military spending to around 10 trillion yen, positioning it as the world’s third-largest military spender after the United States and China.
The Defense Ministry approved the budget request during a meeting on Friday, ahead of its submission to the Finance Ministry for negotiations through December.
Japan has accelerated the defense buildup in its southwestern region in response to China’s increasing military threats and regional sea tensions. China has intensified clashes with Philippine coast guards in disputed South China Sea waters and frequently dispatched coast guard vessels to violate territorial waters around disputed islands in the East China Sea, which are controlled by Japan but claimed by Beijing.
A significant 970 billion yen of the 2025 budget request is allocated for enhancing strike-back capabilities, including the development and acquisition of long-range missiles and related launch equipment, such as from an Aegis-class destroyer. Approximately one-third of the budget is set aside for a satellite constellation to enhance Japan’s ability to detect missile activities, as North Korea, China, and Russia develop harder-to-detect hypersonic missiles.
Facing a declining troop size, Japan is focusing on developing and acquiring more drones for surveillance and combat, with a request of 103 billion yen. The ministry is also seeking 314 billion yen to construct three new multi-purpose compact destroyers requiring 90 crew members each, less than half the current crew size.
Japanese defense officials describe combat drones as “game changers” capable of conducting hours-long missions and reducing human casualties in combat. They see these unmanned weapons as a central element of Japan’s military buildup, which also addresses challenges posed by an aging and shrinking population.
Japan has struggled to meet its Self-Defense Forces (SDF) personnel target of 247,000. The SDF has faced difficulties attracting young recruits in recent years, reaching only half of its recruiting goal of 19,598 last year—the lowest in the SDF’s 70-year history. Additionally, 6,258 mid-career personnel left last year, the highest number in 30 years.
“With declining birth rates and a shrinking working-age population, Japan inevitably faces a severe labor shortage,” the ministry stated in an interim report on human resources released Friday. “We need to build a force that can operate in new ways while strengthening our defense capabilities.”
The report highlighted that a shrinking younger population and more attractive salaries and benefits offered by private companies have created “the worst recruiting environment since the end of World War II.”
The ministry has requested 18 billion yen to implement an AI surveillance system at 40 SDF bases across Japan, aiming to free up 1,000 personnel. An additional 4.3 billion yen is sought for automated supply storage, scheduled to launch in Okinawa in 2027.
In its interim report released Friday, the ministry also called for reforms to improve salaries, working conditions, training, and learning opportunities, and support for working mothers to attract more women into the force.
The ministry has been under scrutiny following a series of revelations of sexual assaults, harassment, and abuse of power in recent years. An internal investigation last year criticized attempts to cover up incidents and a lack of accountability among supervisors. The ministry also faced backlash in July over leaks of classified information and corruption scandals.
