Defining Economic Security
It is obvious that the goal of economic security is to protect Japan’s peace, safety, and economic prosperity by economic means. However, it is unclear from what threats and by what means Japan will be protected. The NSS identifies the threats as “some nations, not sharing universal values, are making attempts to revise the existing international order” and sees them as problematic because they are “gaining superiorities over those states that have defended academic freedom and market economy principles.” In other words, the NSS recognizes that an international order in which China and other authoritarian states become dominant is a threat.
The NSS also identifies “supply chain vulnerabilities, growing threats to critical infrastructure, and the struggle for control over advanced technologies” as areas of economic security. Furthermore, it states that “some states are attempting to expand their own power by exerting economic coercion on other countries by restricting exports of mineral resources, food, industrial and medical goods, and by providing loans to other countries without regard to their debt sustainability,” thereby pointing to the specific actions taken by other countries and recognizing that these actions threaten their security. It reflects the sentiment in Japan that, while in the past Japan has contributed to a rule-based international economic order that is mutually beneficial and reduces political intervention, these authoritarian states are now disrupting and distorting economic relationships to achieve their political purposes, taking advantage of an increasingly globalized and interdependent world.
Differences from Economic Security in the United States
The definition of economic security in Japan is to secure the stability and safety of its people and society from attempts by major powers to achieve their political objective, such as expanding their own power, by deliberately attacking the types of vulnerabilities identified in the NSS. However, it is worth noting that Japan’s view of economic security and discussion on this issue differs somewhat from the discussion of economic security in the United States.
In the U.S., the concept of economic security is not always well defined. Often, economic security is used in the sense of social security, job security, energy security, food security, and so forth, and it can often have nuances of protectionist policies.
Another difference between the discussion of economic security in the U.S. and Japan is the issue of “intent.” When discussing economic security in Japan, it is assumed that countermeasures are taken against other countries intentionally halting exports of certain goods or embedding malicious software in key infrastructure, etc. In the U.S., discussion of supply chain resilience, for instance, is not limited to intentional supply disruptions by other countries, but also includes measures such as natural disasters or measures such as lockdowns due to pandemic policies. In this sense, economic security in the U.S. means that the supply of goods must always be stable, whether due to intentional attacks by other countries or unintentional disruptions caused by natural disasters.
Actions Toward Economic Security
In order to establish economic security, Japan must first have strategic autonomy to avoid succumbing to economic coercion from other countries. It is also important to strengthen strategic indispensability to make Japan less susceptible to pressure from other countries through its one-of-a-kind technologies and capabilities that no other country possesses. Therefore, actions are required not only to strengthen supply chains and protect critical infrastructure, but also to protect and preserve data and information to ensure the reliability of information and telecommunication systems.
In terms of the development of advanced technologies, Japan will look at the state of technological development in other countries to determine which technologies will be game-changers in the future, invest in R&D in these areas so as not to become dependent on other countries, and enhance its own strategic autonomy. In addition, Japan will seek to strengthen its strategic indispensability by finding areas in which it has an advantage and developing technologies ahead of other countries. Furthermore, to ensure indispensability, Japan will strengthen its control over technology leaks and transfers. Issues related to the research integrity and the outflow of human resources are also regarded as security issues.
At the same time, Japan recognizes that it is protected by the rule-based international order. Therefore, as a security strategy, Japan aims to maintain a free and fair international economic order. To this end, it will not only promote World Trade Organization (WTO) reform and regional economic agreements such as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), but also work with like-minded countries to strengthen supply chain resilience and strengthen mechanisms such as the Indo-Pacific Economic Framework (IPEF) to take the initiative as the rule-makers in the international economic order.
China’s state-driven international economic strategy, especially the “debt trap” and development projects centered on state-owned enterprises, is based on a different worldview and conception of the international order than that of Japan and other Western countries. However, it is not only China but also the United States which puts the free trade regime in danger by turning away from the original Trans-Pacific Partnership (TPP) or by not appointing the members of the Appellate Body of the WTO. The effectiveness and efficacy of the rules and principles of free trade have come to be questioned. Under these circumstances, the question of what kind of rules the international economic order will be based on and who will be the rule-makers has important implications as a security strategy. The economic security strategy for Japan does not end with simply strengthening supply chains.
Kazuto Suzuki, Ph.D., is a Professor in the Graduate School of Public Policy at the University of Tokyo and Director of the Institute of Geoeconomics. Photo by Trey Ratcliff.
Understanding Japan’s Approach to Economic Security
By Kazuto Suzuki
Japan
In the past few years, there has been much discussion about economic security. However, it is still not clear what the term means. Is economic security economic or security? This brief examines how the issue of economic security is positioned in Japan’s National Security Strategy (NSS) released in December 2022. Although the National Defense Strategy (NDS) and the Defense Buildup Plan (DBP) were released at the same time, only the NSS addressed the issues related to economic security and therefore only this document will be discussed here.
Defining Economic Security
It is obvious that the goal of economic security is to protect Japan’s peace, safety, and economic prosperity by economic means. However, it is unclear from what threats and by what means Japan will be protected. The NSS identifies the threats as “some nations, not sharing universal values, are making attempts to revise the existing international order” and sees them as problematic because they are “gaining superiorities over those states that have defended academic freedom and market economy principles.” In other words, the NSS recognizes that an international order in which China and other authoritarian states become dominant is a threat.
The NSS also identifies “supply chain vulnerabilities, growing threats to critical infrastructure, and the struggle for control over advanced technologies” as areas of economic security. Furthermore, it states that “some states are attempting to expand their own power by exerting economic coercion on other countries by restricting exports of mineral resources, food, industrial and medical goods, and by providing loans to other countries without regard to their debt sustainability,” thereby pointing to the specific actions taken by other countries and recognizing that these actions threaten their security. It reflects the sentiment in Japan that, while in the past Japan has contributed to a rule-based international economic order that is mutually beneficial and reduces political intervention, these authoritarian states are now disrupting and distorting economic relationships to achieve their political purposes, taking advantage of an increasingly globalized and interdependent world.
Differences from Economic Security in the United States
The definition of economic security in Japan is to secure the stability and safety of its people and society from attempts by major powers to achieve their political objective, such as expanding their own power, by deliberately attacking the types of vulnerabilities identified in the NSS. However, it is worth noting that Japan’s view of economic security and discussion on this issue differs somewhat from the discussion of economic security in the United States.
In the U.S., the concept of economic security is not always well defined. Often, economic security is used in the sense of social security, job security, energy security, food security, and so forth, and it can often have nuances of protectionist policies.
Another difference between the discussion of economic security in the U.S. and Japan is the issue of “intent.” When discussing economic security in Japan, it is assumed that countermeasures are taken against other countries intentionally halting exports of certain goods or embedding malicious software in key infrastructure, etc. In the U.S., discussion of supply chain resilience, for instance, is not limited to intentional supply disruptions by other countries, but also includes measures such as natural disasters or measures such as lockdowns due to pandemic policies. In this sense, economic security in the U.S. means that the supply of goods must always be stable, whether due to intentional attacks by other countries or unintentional disruptions caused by natural disasters.
Actions Toward Economic Security
In order to establish economic security, Japan must first have strategic autonomy to avoid succumbing to economic coercion from other countries. It is also important to strengthen strategic indispensability to make Japan less susceptible to pressure from other countries through its one-of-a-kind technologies and capabilities that no other country possesses. Therefore, actions are required not only to strengthen supply chains and protect critical infrastructure, but also to protect and preserve data and information to ensure the reliability of information and telecommunication systems.
In terms of the development of advanced technologies, Japan will look at the state of technological development in other countries to determine which technologies will be game-changers in the future, invest in R&D in these areas so as not to become dependent on other countries, and enhance its own strategic autonomy. In addition, Japan will seek to strengthen its strategic indispensability by finding areas in which it has an advantage and developing technologies ahead of other countries. Furthermore, to ensure indispensability, Japan will strengthen its control over technology leaks and transfers. Issues related to the research integrity and the outflow of human resources are also regarded as security issues.
At the same time, Japan recognizes that it is protected by the rule-based international order. Therefore, as a security strategy, Japan aims to maintain a free and fair international economic order. To this end, it will not only promote World Trade Organization (WTO) reform and regional economic agreements such as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), but also work with like-minded countries to strengthen supply chain resilience and strengthen mechanisms such as the Indo-Pacific Economic Framework (IPEF) to take the initiative as the rule-makers in the international economic order.
China’s state-driven international economic strategy, especially the “debt trap” and development projects centered on state-owned enterprises, is based on a different worldview and conception of the international order than that of Japan and other Western countries. However, it is not only China but also the United States which puts the free trade regime in danger by turning away from the original Trans-Pacific Partnership (TPP) or by not appointing the members of the Appellate Body of the WTO. The effectiveness and efficacy of the rules and principles of free trade have come to be questioned. Under these circumstances, the question of what kind of rules the international economic order will be based on and who will be the rule-makers has important implications as a security strategy. The economic security strategy for Japan does not end with simply strengthening supply chains.
Kazuto Suzuki, Ph.D., is a Professor in the Graduate School of Public Policy at the University of Tokyo and Director of the Institute of Geoeconomics. Photo by Trey Ratcliff.
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