In a report on the UK government’s Indo-Pacific policy, the House of Commons Foreign Affairs Committee calls for the United Kingdom to propose to Australia and the United States that Japan, along with South Korea, be invited to participate in a AUKUS technical defence cooperation agreement focused on Strand B, or Pillar 2, activities.
AUKUS Pillar 2 designates cooperation in advanced capabilities in eight areas: autonomous undersea systems, quantum technologies, artificial intelligence, advanced cyber, hypersonic weapons, electronic warfare, innovation and information sharing. These lines of effort are critical in reinforcing the integrated deterrence capabilities of the US’s Indo-Pacific allies, including Japan.
Since Japan already has defence cooperation agreements for joint research and development with the US, the UK and Australia, there’s a foundation for AUKUS–Japan cooperation. But cooperation under these frameworks is project-based, with an emphasis on basic technologies rather than a list of priority capabilities. For example, most of the joint research with the US involves technologies directly related to equipment, such as next-generation amphibious technology and modular hybrid–electric vehicle systems. Based on this background, Japan could derive considerable benefit from participating in AUKUS Pillar 2.
The Japanese government stated in its 2022 national defence strategy that leveraging cutting-edge technologies for defence has become critical. Japan, which has high-tech capabilities, needs to cooperate with its allies and mobilise their capabilities to prepare for a long-term race for technological leadership. Because advantages in critical and emerging technologies covered by Pillar 2 of AUKUS will directly translate into military advantages, having access to these technologies will help deter potential adversaries in the Indo-Pacific.
Given Japan’s declining economic power, its future science and technology investment will likely also decline. Japan can acquire critical and emerging technologies more efficiently by closely collaborating with allies and partners. Cooperation through an expanded AUKUS Pillar 2 agreement would allow the participants to complement each other’s capability gaps and leverage economies of scale.
Most importantly, it will promote the internationalisation of Japan’s defence industry. For a long time, the Japanese defence industry’s only client was the Japanese Ministry of Defense and the Japan Self-Defense Forces. But they are undergoing major changes, including a relaxing of the restrictions on defence equipment transfers and promotion of exports. Strengthening ties between the defence industries of Japan and AUKUS members is a good opportunity to improve the Japanese industry’s competitiveness. In Japan, investment in critical and emerging technologies has been driven by civilian usage. In 2020, defence-related procurement from domestic manufacturers made up less than 1% of Japan’s total industrial production value.
The Japanese defence industry must become more internationally oriented. Although joint research and development takes time, the expanded AUKUS group can create an opportunity for the Japanese defence manufacturers to gain marketing and sales know-how from AUKUS partners.
But before it can join AUKUS, Japan will need to overcome a few challenges.
The most critical issue is the lack of an adequate security-clearance system. The Act on the Protection of Specially Designated Secrets, the only existing law on information security in Japan, limits the scope of information that can be classified as state secrets to four areas: diplomacy, defence, prevention of espionage, and prevention of terrorism. It does not cover information in economic and technological fields, and without a security-clearance system in these areas, Japanese manufacturers will struggle to access classified information in joint developments. Japan will need to develop a security-clearance system before it can join AUKUS.
In addition, Japan is striving to become a major arms exporter like the US and UK, so there are concerns about potential conflicts of interest. AUKUS Pillar 1 is reminiscent of Japan’s efforts to sell its conventionally powered submarines to Australia in 2015. But considering the lead time to acquire effective deterrence capabilities in the critical theatre of the Indo-Pacific, this is not the time for commercial clashes. Japan should accept the division of labour within the extended AUKUS framework.
Given the military-oriented nature of AUKUS, Japan joining AUKUS would signal to China that it is part of the ‘integrated deterrence’ network the US promotes. Considering that China, Japan and South Korea are working together to revitalise the dialogue channel through the Japan–China–Korea trilateral summit, policymakers in Tokyo may feel that the timing is inappropriate.
But the security environment in East Asia is more dire than ever, and technology implementation takes years, especially the critical and emerging technologies that define future victories. The US has also expressed a positive attitude towards the expansion of AUKUS Pillar 2 membership. Japan can’t afford to delay its efforts to strengthen its defence industrial base with these technologies. Now is the time to accelerate discussions on Japan’s participation in AUKUS.