Japan’s new prime minister on Friday pledged to pursue an “aggressive” fiscal policy to stimulate growth and boost defense spending, and called China an “important neighbor.”
During her first policy speech to parliament, Sanae Takaichi outlined her economic vision amid global economic uncertainty and persistent inflationary pressures.
“I will turn (people’s) anxieties about the present and future into hope and build a strong economy,” she said, according to Kyodo News.
To curb inflation, Takaichi announced plans to scrap the provisional gasoline tax rate, introduced in 1974, during the ongoing parliament session ending Dec. 17, and to raise the nontaxable income threshold from 1.03 million yen ($6,700) to 1.6 million yen this year.
Takaichi’s policy address comes after she was elected on Tuesday, making her Japan’s first woman to hold the premiership.
Takaichi also said Japan will raise defense spending to 2% of GDP by March, which is two years ahead of schedule.
Japan, the world’s fourth-largest economy, had said it would spend around $70 billion on defense in the current fiscal year, which ends next March, meaning 1.8% of GDP.
“We need to proactively promote the fundamental strengthening of our nation’s defense capabilities,” to deal with “various changes in the security environment” since the three policy papers were drawn up in late 2022, Takaichi said.
The three key documents include the National Security Strategy, the National Defense Strategy, and the Defense Buildup Program, approved by the former Kishida administration in December 2022, marking a major shift in the country’s post-war defense policy.
Takaichi called the alliance with the US the “cornerstone” of Japan’s diplomatic and security policies and said her government will deepen multilateral dialogue with countries such as South Korea, the Philippines, Australia and India, and advance a “free and open Indo-Pacific.”
Japan hosts over 50,000 American soldiers besides military bases and weaponry, under a bilateral defense treaty.
US President Donald Trump is set to visit Japan next week to meet Takaichi. Tokyo is also working on a phone call between the two on Saturday.
Turning to the world’s second largest economy, Takaichi called China an “important neighbor” and said Tokyo needs to foster “constructive and stable” ties with Beijing and promote a “strategic and mutually beneficial” relationship.
Amid reports that some tourists and foreign residents are disregarding local regulations, Takaichi pledged to address the issue “firmly,” while emphasizing that the government would maintain a clear distance from “xenophobia.”
“Without political stability, we cannot advance robust economic, diplomatic, or security policies,” she added.
Japan’s defense spending ‘raises doubts,’ claims Beijing
Reacting to Takaichi’s policy statement, China said the defense spending by Tokyo raises “doubts” among its Asian neighbors, state media reported.
“When it comes to peace and security, China has the best track record among major countries,” Foreign Ministry spokesman Guo Jiakun told reporters in Beijing.
“In contrast, Japan has significantly adjusted its security policy in recent years, continuously increased its defense budget year by year, relaxed restrictions on weapons exports, and sought breakthrough military capabilities. This cannot but raise serious doubts among Asian neighbors and the international community about whether Japan is genuinely committed to ‘exclusively defense-oriented policy’ and peaceful development,” said Guo.
AloJapan.com