Japan Pivots to New Security and Economic Strategy
Japanese Prime Minister Sanae Takaichi vowed to overhaul the country's security apparatus and confront Chinese "coercion" in her first major policy speech. The new agenda includes establishing a national intelligence council and restarting nuclear reactors faster. Takaichi also signaled a break from past fiscal austerity in favor of policies aimed at sparking an economic revival.
- The proposed security overhaul includes revising three key documents—the National Security Strategy, National Defense Strategy, and Defense Buildup Program—by the end of 2026 and removing restrictions on military exports. - Takaichi's economic agenda, dubbed "Sanaenomics," aims to stimulate growth through public-private investment in 17 strategic industries, including AI, quantum technology, and aerospace. - Her reference to Chinese "coercion" follows a diplomatic crisis that began in November 2025 after she stated a Chinese attack on Taiwan could represent an "existential crisis for Japan," permitting military action in collective self-defense. - In response to Takaichi's stance on Taiwan, China has imposed retaliatory measures, including restricting imports of Japanese seafood, cutting off tourism and cultural exchanges, and restricting the export of rare earth materials to Japan. - The push to restart nuclear reactors is already in motion; Tokyo Electric Power Company's Kashiwazaki-Kariwa plant, the world's largest, recently resumed trial power generation for the first time in nearly 14 years, with full commercial operation for its No. 6 reactor slated for March 18, 2026. - Following a landslide victory in the February 8th general election, Takaichi's ruling coalition now holds a two-thirds "supermajority" in parliament, which is the requirement to initiate amendments to Japan's pacifist constitution. - The new economic strategy represents a shift from the policies of the previous administration under Shigeru Ishiba and is intended to increase Japan's strategic autonomy and resilience in critical supply chains. - To fund the planned increase in defense spending to 2% of GDP, the Takaichi administration has already earmarked ¥1.1 trillion in a supplementary budget and plans to raise income, corporate, and tobacco taxes.
