The government has decided to allocate less than ¥300 billion ($2.7 billion) for Okinawa's economic development for the first time in 10 years in fiscal 2022, an official familiar with the matter said Saturday, as confrontation over a U.S. military base intensifies between them.

The government's stated reason is that reducing spending on public works in Okinawa is possible as infrastructure development has already progressed in prefecture, which next year marks the 50th anniversary of its reversion to Japan from U.S. control.

But government officials have suggested that the real reason behind the cut in the budget for Okinawa in the year starting next April is related to the prefectural government's stiff opposition to a plan to relocate U.S. Marine Corps Air Station Futenma within the subtropical island.