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Policy Proposals  Industrial Technology Proposal for the National Defense Program Guidelines (Summary)

May 14, 2013

The defense industry plays an important role in the entire lifecycle of defense equipment. Defense production and technological base plays significant roles such as "Deterrent capabilities and sovereignty based on advanced technological capabilities," "Speedy procurement, operational support and improvement of equipment," "Development and production of equipment suited to national geographical characteristics and conditions in Japan" etc. Maintaining and strengthening of the industrial base are critical responsibilities of a nation.

However, as a result of a reduction in the defense budget in Japan, some companies are being forced to reduce or withdraw from defense business. Therefore, realistic measures to maintain the Japanese industrial base are required.

Specifically, it is necessary to clarify key areas to maintain/strengthen production and technological base within the country, ensure necessary financial support, and increase the research and development budget and expand basic technical research to improve the overall development capabilities for advanced technology including civilian sectors.

In accordance with the comprehensive exemption measures for the Three Principles on Arms Exports, collaboration with European countries needs to be promoted. It is necessary to clarify what type of cooperation is possible to be implemented as "international joint development/production of defense equipment". Conclusion of memorandum of understanding (MOU) between governments, establishment of an appropriate control system for extra-purpose use and transfers to third parties, the criteria of transfers to third parties etc. and policies on international joint development/production as for areas/items/technologies are also necessary.

Regarding acquisition and procurement policy, it is necessary to establish government-industry partnerships through utilization of long-term contracts etc. which would lead to the stable and WIN-WIN relationships.

In summary, basic government policy for maintaining and strengthening defense production and technological base should be included in the National Defense Program Guidelines. Further detailed "Strategies for Defense Production and Technological Base" should be formulated and implemented based on the above policy, clarifying and maintaining/strengthening the key areas and promoting international joint development/production. Keidanren will make efforts for gaining international competitiveness in expectation of future prospects being clearly foreseen through the implementation of various assistance measures.

Industrial Technology