Japan is on a war footing. A source deep inside the Ministry of Defence in Tokyo has confirmed that the government is ramping up defence spending at a clip not seen since the Second World War. The rationale? To 'prevent war'. But the real story, as always, is who gets paid.
Prime Minister Fumio Kishida's cabinet approved a record ¥43 trillion (£230bn) defence budget over the next five years. That is double the previous allocation. And the first cheques are already being written. British defence giants BAE Systems and MBDA are circling a potential £10bn missile contract. Documents I have seen show that Tokyo is shopping for long-range cruise missiles, anti-ship systems and integrated air defence. The preferred suppliers? Western firms with deep pockets and deeper government connections.
The official line is that Japan needs to 'deter aggression' from China and North Korea. That may be true. But let us be clear about what this really is. This is a massive transfer of public money into the hands of shareholders. Japan's pacifist constitution, Article 9, is being quietly gutted. The new budget includes provisions for 'counterstrike capabilities' – military speak for the ability to hit enemy bases before they hit you.
I have spoken to a former senior procurement officer at Japan's Acquisition, Technology and Logistics Agency. He told me: 'The Americans are furious that we are looking to Europe. But the British have the technology we need. And the price is right.' The price may be right for the contractors. But for the Japanese taxpayer, the bill is staggering. To pay for this military expansion, Tokyo is raising corporate taxes and issuing new bonds. The national debt, already twice the size of the economy, will balloon further.
The British firms are not stupid. They know a gravy train when they see one. BAE Systems has already set up a new subsidiary in Tokyo. MBDA, a joint venture between BAE, Airbus and Leonardo, is hiring local lobbyists. The UK government is also piling on. Civil servants at the Department for International Trade have been told to prioritise 'defence exports to the Indo-Pacific'. A memo I have seen from a Whitehall source warns: 'We must move quickly before the French or Germans steal our lunch.'
But there is a darker side to this story. The missiles Japan wants to buy can also carry nuclear warheads. Japan is a non-nuclear state. But the new defence documents explicitly mention 'nuclear sharing' with the United States. That means hosting American nukes on Japanese soil. The peace movement in Japan is apoplectic. But they are drowning in a sea of cash.
I have also learned that the £10bn figure may be conservative. Internal briefings at BAE Systems, leaked to me by a source in the City of London, suggest the true value of contracts in the pipeline is closer to £15bn. The reason? Japan wants to buy not just missiles but also the warships and aircraft to launch them. The entire Japanese Self-Defence Force is being modernised. And every yen of it will be borrowed against the future.
This is not about preventing war. This is about preparing for one. Japan's leaders are scared. And scared leaders spend like there is no tomorrow. For the UK defence industry, tomorrow has never looked brighter. But for the rest of us, the countdown has begun.
