Japan to increase defence budget by $7.3 bln in fiscal 2023

Japan’s government is set to raise defence spending by 1 trillion yen ($7.34 billion) to around 6.5 trillion yen in the next fiscal year as part of efforts to earmark 43 trillion yen for the five-year defence build-up plan, three sources with direct knowledge of the matter said.

The budget increase is aimed at procurement of ammunition and expenses related to long-range missiles, the sources said on condition of anonymity as the plan has not yet been finalised.

The fiscal 2023 budget spending on defence would compare with a record 5.4 trillion yen earmarked for the current fiscal year.

Prime Minister Fumio Kishida has announced plans to lift defence spending to an amount equivalent of 2% of gross domestic product within five years, from 1% now, to cope with an increasingly assertive China and unpredictable North Korea.

As part of the plan for 43 trillion yen in defence spending over the next five years, Kishida’s government would spend 5 trillion yen on stand-off missiles and another 5 trillion yen for ammunition purchases, the sources said. One of the sources said the defence budget “would increase by 1 trillion yen every year over the next five years.”

($1 = 136.2400 yen)