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Japan Stimulus Plans $2.1-B for Military

Japan plans to spend JPY 180.5-B ($2.1-B) on its military over the next few months as part of a large new stimulus package, a defense ministry official said Wednesday.

The cash is in addition to the regular military spending for Y 2012-13 and is separate from a boosted budget request for the next F-Y that ruling party policymakers called for Tuesday.

“We will request J[Y 180.5-B to be allocated to military spending from a stimulus package,” a defense ministry spokesman said, adding that some of the cash will be used to buy PAC-3 surface-to-air anti-ballistic missile systems and modernize four F-15 fighter jets.

The request for funds has to be approved by the finance ministry before being officially included in the stimulus the government is set to announce later this month, reportedly worth JPY 13.1-T for this F-Y to March.

The announcement came a day after Prime Minister Shinzo Abe’s ruling Liberal Democratic Party said Japan will increase military spending for the 1st time in 11 yrs in the next F-Y starting April.

Japan is involved in a territorial tussle with China over a group of uninhabited islands in the East China Sea. .

Nerves in Tokyo have also been rattled by an unpredictable North Korea. It sent a rocket over Japan’s southern islands last month in what it insisted was a satellite launch. Tokyo and its allies said the launch was a covert ballistic missile test.

“Out of J{Y 180.5-B, the defense ministry plans to use JPY 60.5-B to prepare for the changing security environment surrounding Japan,” the spokesman said.

The defense ministry also plans to purchase three SH-60K patrol helicopters and to add a battery for an intermediate range ballistic missile system, he said.

“We need to update our equipment as the security environment surrounding Japan is becoming harsher as North Korea has test-launched missiles twice in the last year and tensions with China continue,” he said.

Under usual precedent, 70%-80% of a defense order must be spent with domestic firms, although this is not a legal requirement, he said.