Japan Looks to Reduce FMS ‘Burden'

Japan Looks to Reduce FMS ‘Burden'
Japan is seeking to reduce the 'burden' of spending on US military equipment through the Foreign Military Sales (FMS) mechanism, Japanese Defence Minister Takeshi Iwaya said in comments published by the Ministry of Defence (MoD) on 3 December.<br />In comments made during a MoD recent press conference, Iwaya said Japan will look to address its increased...
Japan is seeking to reduce the 'burden' of spending on US military equipment through the Foreign Military Sales (FMS) mechanism, Japanese Defence Minister Takeshi Iwaya said in comments published by the Ministry of Defence (MoD) on 3 December.

In comments made during a MoD recent press conference, Iwaya said Japan will look to address its increased spending on FMS procurements in the government's National Defence Programme Guidelines (NDPG) and the associated Mid-Term Defence Programme (MTDP), both of which are expected to be published before the end of the year.

In response to a reporter's question about Japan's increased spending on FMS acquisitions and whether this would create fiscal pressure on the MoD, Iwaya said, "The burden in future years, including for FMS, will gradually increase, as has been pointed out in the Diet [parliament] too. Of course, this is a concern that we share, and we intend to fully address this in the next National Defence Programme Guidelines and the Mid-Term Defence Programme."

The Japanese MoD has not elaborated on the measures it might introduce in the NDPG and MTDP that would address Japan's increased spending on FMS purchases.

However, Jane's understands that Japan is seeking to reduce the administration costs linked to FMS as well as improve the transparency on FMS pricing methodology. Japan also wants FMS deliveries to be accelerated. Such issues are the subject of negotiations by the two sides in a joint committee set up recently to resolve some of the differences on FMS deals.

Another point of contention is a sizeable US debt to Japan in relation to unreturned advanced payments from Tokyo on FMS deals. Jane's understands that until fiscal year 2016 (FY 2016) Japan's advanced payments on FMS programmes were about JPY100 billion (USD937 million).

Source: www.janes.com