Japan has lifted decades-old restrictions on arms exports, opening significant opportunities for its defense industry to enter the global market at a time of record-high military spending worldwide. According to SIPRI, global military expenditures reached $2.89 trillion in 2025, marking the 11th consecutive year of increase, and countries are described as 'desperate' to acquire weapons such as air defense missiles, artillery shells, and armored vehicles—areas where Japan is expected to expand its market share [1].
Experts indicate that Japan will initially focus on exporting arms in sectors where it already has technological strengths, including air defense systems and naval platforms. The next-generation Global Combat Air Programme fighter jet, developed with Britain and Italy, is highlighted as a 'crown jewel' of Japanese engineering and is set to replace the Eurofighter Typhoon in the U.K. and Italy, as well as the Mitsubishi F-2 in Japan [1]. In April, Australia signed contracts for its first three general-purpose frigates, to be built by Mitsubishi Heavy Industries based on the upgraded Japanese Mogami-class design. There is also growing foreign interest from countries such as Indonesia, the Philippines, and New Zealand in Japanese defense systems and equipment [1].
Despite these opportunities, significant challenges remain. Japanese firms currently lack international marketing experience and cost-competitiveness, which may limit their ability to fully capitalize on the export boom. Experts suggest that Japan may initially carve out specialized niches rather than compete broadly with established global arms exporters [1].
The global environment appears favorable for Japan's defense sector, with traditional U.S. partners seeking alternative suppliers amid surging demand and doubts over American alliance commitments. South Korea's recent success in the defense export market is cited as a potential template for Japan, as it has benefited from producing arms that are cheaper, faster, and of comparable quality to U.S. weapons [1].
CONCLUSION
Japan's easing of arms export restrictions positions its defense industry for significant growth in the global market, particularly in air defense and naval sectors. While the environment is favorable and international interest is rising, Japanese firms must overcome challenges related to marketing and cost-competitiveness to fully realize this potential.