With China flexing hard in the East China Sea, Japan’s government just greenlit a whopping 3.5% defence spending surge to 9 trillion yen ($58B) for 2026 – the biggest ever – amid fiery spats over Taiwan that could drag Tokyo into the fray.
Cabinet-approved Friday, the draft pumps 100 billion yen into “Shield,” a high-tech system guarding Japan’s vast coastline and remote islands from ships, subs, and drones – straight response to PM Sanae Takaichi’s November bombshell calling a Chinese Taiwan invasion an “existential threat” that justifies Japan’s self-defence punch.
Beijing hit back fierce: travel alerts, axed flights, seafood import bans, and fresh drama with Chinese jets allegedly radar-locking Japanese fighters near Okinawa (denied by China). Japan’s missile plans on Yonaguni Island – just 110km from Taiwan – only cranked the heat.
This fits a monster 122.3 trillion yen total budget tackling Japan’s ageing crisis with social spends, but it’s bond-funded despite record taxes – piling onto debt over twice GDP and pressuring the yen. Takaichi’s bold play signals Tokyo’s done playing nice in Asia’s powder keg.
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