(Photo: Prime Minister’s Office of Japan)

Japan’s new Prime Minister Yoshihide Suga has a tough act to follow. For almost a decade, his predecessor and former boss, Shinzo Abe, played a pivotal role in revamping Japan’s foreign and defense policy. Some would even credit the former Japanese leader as the chief architect of the “Indo-Pacific” strategic paradigm, which has paved the way for closer maritime security cooperation between the United States and its key allies on one hand, and the other rising giant of Asia, India, on the other.

No longer confined to “checkbook diplomacy”, Japan has become an active contributor to regional security and development.  The rise of an increasingly assertive China and the concomitant disarray in American foreign policy has further accentuated the centrality of Japan to preserving the liberal international order.

While Japan’s new leader is naturally expected to focus on consolidating power and addressing acute economic imbalances at home, it is crucial for the Suga administration to build on the strategic initiatives of its predecessor. As we have seen in Tokyo’s high-profile hosting of the Quad strategic dialogue this week, the new Japanese leader has embraced strategic continuity, but this should extend beyond likeminded major powers . This is especially important in Southeast Asia, where regional states are fretting over a lack of U.S. leadership and desperately seeking to avoid overdependence on a domineering China.

A major strategic priority for Japan’s new leadership should be the empowerment of frontline states such as the Philippines and Vietnam, which have been locked into festering maritime disputes with China. Surely, no one is expecting  Japan, which is grappling with stubborn economic stagnation and has yet to overcome constitutional restrictions on external projection of power, to save the world. Through a realistic and targeted approach, however, Japan would be able to concentrate its finite strategic capital in places where it could make the greatest geopolitical difference.

Middle Power Activism

In recent years, Japan has challenged two major geopolitical misconceptions. The first is that the country is a has-been Asian power, well past its days of glory and influence. And the second is that the United States’ more inward and protectionist turn under the Donald Trump presidency would inevitably lead to the disintegration of the liberal international order.

Still the third largest economy in the world, with one of the most powerful naval forces, Japan has shown what “middle powers” are capable of in times of great power rivalry and international distress. Together with other likeminded countries, Japan effectively rescued the Trans-Pacific Partnership agreement, sealed the world’s largest trade deal with Europe, and, most crucially, launched a $110 billion infrastructure investment fund for Asia.

The primary purpose of all these mega-initiatives is to keep China’s influence at bay, especially in vulnerable regions such as Southeast Asia. But Japan’s strategic foray into the region has gone well beyond reinforcing the U.S.-led Indo-Pacific Transparency Initiative, which seeks to expose China’s predatory economic practices. Thanks to a new wave of investments in strategic sectors,  Japan is not only a primary driver of industrialization but also still the leading source of infrastructure investments in Southeast Asia.

The latest data shows that Japan’s total commitments ($367 billion) still trounce China’s ($255 billion), especially in key states such as the Philippines and Vietnam where Beijing is yet to truly deliver on its big-ticket infrastructure investment pledges. The Suga administration should continue and even expand such initiatives, which hit multiple birds with one stone.

First of all, they boost Japan’s economic competitiveness as well as access to promising emerging markets amid decoupling from China. Crucially, they help Southeast Asian countries avoid the Chinese “debt trap”, which has threatened not only small and impoverished nations but even more developed regional states such as Malaysia.

Above all, Japanese investments reinforce good governance standards and put an emphasis on “quality infrastructure” given lingering concerns over lack of transparency and overall sustainability of China’s Belt and Road Initiative projects. As a result, regional countries which have welcomed large-scale investments from Beijing are now seeking Japanese assistance to rescue troubled projects, as Indonesia is for the Jakarta-Bandung high-speed railway.

Japan’s proactive economic initiatives also have significant security implications, as they provide alternatives to Chinese development financing which may come with strategic risks. A leading area of concern is China’s “economic cabbage strategy”, which looks to make targeted investments in critical infrastructure and sensitive locations within frontlines states such as the Philippines. While China’s $24 billion investment pledge has proven illusory, there are troubling signs of a “bargain hunting” offensive from Beijing in the twilight years of Rodrigo Duterte’s presidency.

Countering China’s Predation

Desperate to counter an ongoing economic crisis and vindicate his Beijing-friendly diplomacy, Duterte has recklessly welcomed Chinese state-backed investments in critical sectors, potentially at the expense of national security.

Despite repeated warnings, Duterte has backed a multi-billion-dollar international airport project at Sangley Point, which also hosts the Philippines’ naval command-and-control center. Adding insult to injury, the project is led by an affiliate of China Communications Construction Company, which was recently sanctioned by the United States for its involvement in illegal land reclamation activities in Philippine-claimed waters.

In response, both the former and current Philippine Navy chiefs have lashed out at the proposed project, warning that it could force the closure of naval facilities that guard the entrance to Manila Bay, saying “Manila bay is the center of gravity of the national government. If Manila falls, the whole country falls.”

Meanwhile, another China-backed company, Dito Telecommunity, has been allowed to “build facilities in military camps and installations” in the Philippines, even as both an internal military report and the United States have warned of potential espionage and threats to intelligence-sharing among allies.

Across the country, Chinese state-backed companies are seeking investments in areas close to key military bases, from resort islands close to Taiwan in the north to Subic and Clark near Scarborough Shoal and Bautista Airbase near the Spratly Islands. Japan and likeminded allies can play a crucial role by offering viable alternatives as well as technical support to properly asses the viability and implications of suspect Chinese investments.

Last year, Japan, Australia, and the United States were able to jointly push back, as part of a broader private-sector-led effort, against efforts by Chinese companies to gain a foothold in a sensitive naval facility through the purchase of the gigantic Hanjin shipyard in Subic. The Suga administration should build on such successful precedents, which allowed the Sino-skeptic Philippine defense establishment to protect against Chinese infiltration into sensitive locations.

This is why it is important for Suga to maintain his predecessor’s strong rapport with regional leaders and provide an alternative to Chinese investments. Otherwise, Beijing-friendly statesmen like Duterte would be in a stronger position to offer prized investments to Chinese state-backed companies with potentially troubling implications.

Japan’s role, however, is not limited to investment. In recent years, it has ramped up defense spending to historic levels and, for the first time in the post-war period, deployed armored vehicles for overseas military exercises in the Philippines. This has coincided with new defense and logistics agreements which have allowed Japan to expand maritime security cooperation with and large-scale assistance to frontline states such as the Philippines, Malaysia, and Vietnam in the South China Sea.

To begin with, Japan can play a key role in enhancing intelligence, surveillance, and reconnaissance and overall domain awareness of regional states. Japan’s sale of a fixed and mobile air surveillance radar system to the Philippines opens the door for more defense acquisitions in the future. Suga should look to build on these recent strategic gains by turning Japan into a reliable and long-term maritime security partner for smaller regional states, which are intent on resisting China’s expansionism and predatory investments.

About Richard Javad Heydarian

Richard Javad Heydarian is an Asia-based academic, currently a Research Fellow at National Chengchi University (Taiwan), and author of, among other works, The Rise of Duterte: A Populist Revolt against Elite Democracy and The Indo-Pacific: Trump, China, and the New Struggle for Global Mastery.