Japan aims to not only continue raising the budget for its military aid program over the coming years but also expand the number of recipient countries, with the Foreign Ministry considering up to nine potential beneficiaries next fiscal year alone, according to government sources.
For fiscal 2025, which starts April 1, the ministry has requested ¥8 billion ($51.5 million) for Japan’s official security assistance (OSA) framework. If approved by parliament, this would mark a 60%, or ¥3 billion, year-on-year increase as Tokyo seeks to strengthen the security and deterrence capabilities of like-minded countries amid growing concerns over the regional security environment.
Among the nations being considered for the third OSA tranche are Malaysia, Indonesia and the Philippines, all of which are already beneficiaries, as well as Papua New Guinea.
“We'd also like to add some new nations, new partners, and eventually work with eight or nine countries next fiscal year,” a government official told The Japan Times on condition of anonymity.
The expected increase in OSA spending would be the third since the program was launched in 2023 with an initial ¥2 billion budget, marking a break with Tokyo’s previous policy of avoiding the use of development aid for military purposes other than disaster relief.
Tokyo has said that the overall aim is to “reinforce” the region’s “comprehensive defense architecture” and create a more favorable security environment for Japan, with the equipment, supplies and infrastructure development assistance being provided in the form of grants, rather than loans.
As OSA funds increase, so will Japan’s efforts to boost the number of countries it assists, with those already enrolled in the program expected to receive larger grants going forward.
“Projects with countries that will be in their second or third OSA tranche next year are likely to become larger,” the official said. “As we become more familiar with both the process and these nations’ requirements, we plan to step up assistance levels wherever appropriate.”
A closer look at the figures shows this approach is already being implemented.
So far a total of seven countries have joined the program, which in April will enter its third year. These include Bangladesh, Fiji, Malaysia and the Philippines, all of which began participating in fiscal 2023, with Indonesia, Mongolia and Djibouti added this fiscal year.
The Philippines was also among the beneficiaries in fiscal 2024, seeing its grant rise from ¥600 million in fiscal 2023 to ¥1.6 billion.
Whereas the first package for Manila was limited to coastal surveillance radar systems for the navy, the second was to help procure items for both the navy and the air force, including more coastal radars, inflatable boats and funds for equipment to support the continued operation of air surveillance radars Manila acquired from Tokyo in 2020.
Also covered by the 2024 OSA tranche were high-speed patrol boats for Indonesia under a ¥1 billion grant, a coastal radar system and related infrastructure for Djibouti worth ¥1.1 billion and an air-traffic control radar system and related equipment for Mongolia totaling around ¥1 billion.
But while OSA grants to countries like Malaysia, the Philippines and Indonesia may be easier to understand given their proximity to Japan, location alongside key maritime trade routes and the program’s emphasis on maritime security, this doesn’t explain why OSA has also been extended to landlocked countries such as Mongolia or nations as far away as Djibouti.
But there are good strategic reasons for this, the official said.
Djibouti is home to the Self-Defense Forces’ only overseas facility and is a critical outpost for helping support stability in the Gulf of Aden and the Indian Ocean amid piracy threats.
“So, it makes sense for Japan to use this program to strengthen an already very important security partnership,” he said.
As for Mongolia, Tokyo says it wants to support the country in its efforts to avoid overreliance on its immediate neighbors — China and Russia — especially as Ulaanbaatar has adopted a “third neighbor policy” designed to strengthen relations with other nations.
While none of the agreed OSA-related items have been delivered, sources told The Japan Times that the equipment for the Fiji and Bangladesh navies under the 2023 tranche is already being built, with deliveries of rescue boats and underwater cameras set to start before this summer. The provision of the agreed patrol boats, however, is slated for next year, given the longer construction time required.
Meanwhile, the tender process for the items agreed on with Manila and Kuala Lumpur under the same tranche is slated for completion by the end of the next month, meaning that delivery of the radar systems and rescue boats could be expected within a year.
The reason for the relatively slow delivery pace, the official said, is due mainly to negotiations, tenders and contracts, which require an “appropriate and transparent” implementation.
First announced in December 2022’s revised National Security Strategy (NSS), OSA has been promoted as an expansion of Japan’s foreign aid frameworks, but is separate from the Foreign Ministry’s Official Development Assistance program, and it is designed to cover projects “for the benefit of armed forces and other related organizations.”
That said, OSA cannot be used to provide just any military equipment, as the program must also abide by Japan’s strict arms export controls.
These rules, however, have been loosened in recent years as Tokyo continues to shed some of its postwar constraints on defense, in part to support the country’s defense industry. Contracts for OSA projects have so far all gone to Japanese companies, and this is likely to remain the case unless they are unable to provide specific equipment or parts.
While the program provides grants for equipment, infrastructure and initial training, maintenance or repair costs must be covered by the partner country.
Although not the program’s top priority, there are also hopes that the OSA program could inspire partner nations to eventually purchase Japanese defense products.
But critics have said that the relatively low level of financing provided under OSA fails to match Tokyo’s ambitions. They argue that the small amounts don't allow for the purchase of military equipment to the extent needed to meaningfully improve deterrence capacities.
Government sources, however, say that assistance levels are expected to rise as the program matures, but note also that it was never intended to be at the center of a regional deterrence plan.
“Considering that some countries are expected to remain in the program for several years, we expect aid levels to add up to something substantial over the years in terms of the capacity building,” the official said.
However, even though OSA is strategic by nature and was launched as part of Tokyo’s revised NSS, the official noted that the framework is “not primarily designed to influence the military balance of power in the region.”
At the same time, the military program is remarkable, he added, not only because it is unprecedented in Japan’s postwar history but also because it delivers concrete assets to partners, ties in with Japan’s other military capacity-building efforts and is incremental.
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