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southwest archipelago, of which Okinawa is a cooperation in Japan with new services and solutions, as well as
linchpin, as China routinely intrudes in waters to establish long-term strategic partnerships with Japan and its
surrounding the Senkaku Islands. industries.’ Some might see this decision as a further blow to Japan’s
wider defence industry. Komatsu had manufactured 389 Type 96
Opportunities WAPCs, but the company pulled out of the defence sector in 2019
Japan is relatively self-sufficient when it comes as it complained it was too difficult to achieve a profit. Komatsu
had also developed the Improved WAPC, but it was canned as the
to much of its military equipment, though its JGSDF claimed it had insufficient levels of armour protection.
traditional supplier has been the USA for high-
tech systems like the RQ-4B Global Hawk, Aegis The defence sector contributed only 1.5% to Komatsu’s revenue, so
combat system, E-2D Hawkeyes and SM-series its withdrawal hardly impacted its overall business. Nonetheless, the
missiles.
JGSDF was seriously affected by this pull-out and consequently it
must look overseas for some equipment. MHI remains Japan’s sol-
However, there are plentiful opportunities for itary manufacturer of armoured vehicles, and it was undoubtedly
foreign OEMs. Take small arms, for instance. On disappointed not to have won the WAPC replacement contract.
23 January, the MoD announced the Japan Japan’s defence industry is uncompetitive and pricey due to small
Ground Self-Defense Force (JGSDF) would production runs solely for the JSDF. Aware of this, the MoD is trying
adopt approximately 900 Heckler & Koch HK417 to order equipment in bulk via long-term contracts to lowers costs.
7.62mm sniper rifles and about 3,100 FN Herstal Preferring indigenous manufacture, Japan has also routinely opted
Minimi Mk3 5.56mm light machine guns directly for licenced production. However, this always inflates costs, with a
from the manufacturers.
prime example being local assembly of the F-35 fighter.
Another interesting case concerns a new 8x8 The NSS alluded to efforts to improve efficiency: ‘Specifically, in
armoured vehicle for the JGSDF as it sought a order to build a strong and sustainable defence industry, Japan
replacement for its Type 96 Wheeled Armoured will promote various initiatives, including making business projects
Personnel Carrier (WAPC). The competition more attractive and actively leveraging the outcomes of advanced
launched in September 2019 had been nar- technological research in the public and private sectors for research
rowed to two competitors: the Mobile Armored and development of defence equipment. Japan will also reinforce
Vehicle from Mitsubishi Heavy Industries (MHI), the system for research and development of new defence equipment
and Patria’s AMV XP. After intensive trials, and take other measures.’
Patria announced last December that the AMV
had been selected. This is significant, since Exports are an attractive way for companies to boost production
a foreign company has defeated a domestic
entry. Patria stated: ‘The selection includes runs and to lower overall unit costs. The Acquisition, Technology and
manufacturing licence of the vehicles in Japan, Logistics Agency (ATLA) – which commenced operations in October
with a solid contribution to the local economy 2015 – was established to coordinate imports, exports and research
and technology development securing the and development. ATLA controls around a third of the MoD’s budget.
supply and service in Japan.’ Production will Governmental regulations continue to evolve too. A first round of
be undertaken by a Japanese private-sector eased export restrictions occurred in December 2011, followed by
company, though it is still unclear how many another in April 2014 when Shinzo Abe overturned the long-standing,
vehicles the JGSDF needs. self-imposed policy of Three Principles on Arms Export that essen-
tially prohibited the export of weapons to anyone except the USA.
The Finnish firm established a local subsidiary
called Patria Japan Limited, and the company The new 2014 rules were named Three Principles on Defence
noted, ‘Patria sees the selection of Patria AMV Equipment Transfers, and they allowed greater technical coopera-
XP 8x8 as a great opportunity to further develop tion with overseas companies, plus direct sales of equipment that

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