Beyond the ‘Trump shock’: Japan’s recalibration in a multipolar world

Japanese Prime Minister Shigeru Ishiba became the second foreign leader to visit the White House after Donald Trump’s inauguration as US president. In their joint statement, the two nations reiterated their focus on and criticism of China concerning the Taiwan Strait, East China Sea and South China Sea issues.

However, Ishiba has consistently expressed goodwill towards improving China-Japan relations since taking office, stating his desire to visit China soon. In early 2025, Liberal Democratic Party (LDP) secretary-general Hiroshi Moriyama and Komeito secretary-general Makoto Nishida led Japan’s ruling party delegation to China. These actions reflect two contradictory strategic impulses in Japan.

A nation’s strategic agenda is largely rooted in its “strategic perception”, which serves as the foundational framework for monitoring and analysing international relations. Since the Russia-Ukraine war broke out in 2022, Japan’s strategic thinking has undergone significant changes.

By 2023, the strategic understanding that the world comprising three major blocs has gradually formed: democratic nations represented by the US, Japan and Europe, authoritarian nations represented by China and Russia, and the global south represented by many emerging and developing nations. In 2024, while Japan’s strategic global assessment has continued to be guided by the above framework, two major changes are evident.

First, Japan has increasingly perceived that the US and developed European nations are becoming more inward-focused and experiencing a decline. Additionally, its view of the Western-led global order, based on the Group of Seven (G7) leadership, has been further shaken. In 2024, the Biden administration’s failure to address high inflation and the struggles of the middle class intensified domestic divisions, leading to Trump’s re-election as US president.

Signalling worsening trade protectionism, the US blocked the acquisition of US Steel Corporation by Japan’s Nippon Steel Corporation, citing national security concerns. The US has also shown its limitations in attempts to resolve the Middle East conflict, with its strong bias towards Israel significantly weakening its soft power. Trump’s re-election has also raised serious questions about the continuation of military aid to Ukraine.

To Japan, the US is no longer a role model of democracy, nor is it the leader of free economy or the reliable leader of alliances anymore. Fundamental to this new perception is the declining confidence in the US and the growing doubt about its reliability.

2024 was also the election year for major US allies. In the UK, the Conservatives lost power after 14 years in government. In France, the ruling coalition lost one-third of its seats in the elections. In Germany, far-right parties were victorious in several eastern states, and Chancellor Olaf Scholz lost a confidence vote at the Bundestag, leading to early elections in February 2025.

In Japan’s view, domestic instability and growing populism in the G7 nations have reduced their willingness and ability to continue their global leadership.

Second, Japan is increasingly cognisant of the collective rise of the global south and its growing role in shaping a new global order. In January 2024, the BRICS grouping underwent a historic expansion, increasing its membership from five to nine nations. While the G7’s share of global GDP has declined from 63% two decades ago to 45%, the BRICS’ share has grown from 9% to 25%.

At the BRICS summit held in Russia in October 2024, regional powers such as Indonesia, Turkey and Nigeria joined as partner nations, including notably three main ASEAN member nations (Malaysia, Thailand and Vietnam), which impact upon Japan significantly. In January 2025, Indonesia officially became a BRICS member nation. With more than 30 countries reportedly seeking to join it, the BRICS has become an important symbol of solidarity and cooperation within the global south.

With the above two changes in strategic perception, Japan has displayed two distinct “strategic autonomy” tendencies in its strategic choices.

The first tendency is based on the belief that domestic political turmoil and democratic backsliding have resulted in the power decline of the US and Europe. Japan, a model of domestic stability and democratic maturity, should proactively assume global leadership and take on the role as the main defender of the liberal global order established by the US and Europe. This is reflected in Japan’s “three-ring foreign policy”.

The first ring entails maintaining a strong US-Japan alliance and achieving an equal alliance by enhancing Japan’s defence capabilities and easing the relevant legal restrictions.

The second ring involves building a network of relations between the US-Japan alliance and partner nations, including the Quad (an alliance of the US, Japan, India and Australia), minilateral frameworks such as the trilateral US-Japan-South Korea and the US-Japan-Philippines partnerships. This also includes Japan’s participation in NATO Summits, as well as the transformation of the US-centred East Asian hub framework into a US-Japan dual-centre framework.

The third ring focuses on strengthening relations with the global south’s regional blocs, primarily aiming to align them with the liberal global order. These constitute an “externally-driven strategic autonomy tendency” — fostering partnerships that support liberal values and systems, while also promoting autonomy within these regions.

The second strategic autonomy tendency also acknowledges the decline of the US and Europe but identifies the collective rise of the global south as fundamental to the shift in global order. The decline of developed nations, represented by the G7, is essentially due to reduced competitiveness and innovation.

Japan must face up to this reality and embrace pragmatism instead of ideology, to proactively participate in global affairs and strive to gain advantage amidst building a new global order. These represent an “internally-driven strategic autonomy tendency” — leveraging its own strengths and adapting to global changes to maintain or enhance its position in the world.

While many analysts have attributed Japan’s rapprochement with China to the “Trump Shock”, I believe it is more accurate to describe it as an intensifying struggle between Japan’s two strategic autonomy tendencies instead of a shock to Japan’s foreign policy. This struggle manifests itself in the contradictions and duality in Japan’s China policy. Japan’s recent rapprochement with China reflects the rise of the internally-driven strategic autonomy tendency.

First, Trump 2.0 will spark and hasten debates among the US’s allies, including Japan, about whether their chief strategic priority should be internal or external. While the LDP has maintained its ruling position, it has not secured the majority in Japan’s National Diet, resulting in the Ishiba administration being a minority government. The electoral setbacks to the ruling parties in the US, Europe and Japan are fundamentally due to voter disillusionment and frustration with the political status quo.

High inflation, which has led to a surge in the cost of living and financial hardship, has become the most pressing issue for developed economies. A public opinion survey conducted after Japan’s general election in October 2024 has shown that more than half of the voters are most concerned about measures to address the economy and high prices. Meanwhile, Japan’s traditional competitive advantage is rapidly diminishing as competition in the electric vehicle industry has shifted from the engine to AI-driven software. Japan’s waning economic competitiveness is also reflected in the sharp depreciation of the yen in the past two years.

Second, a significant increase in military spending is unable to resolve the above challenges faced by Japan and the US allies. The internal need for prudent resource allocation has generated the willingness and motivation to improve relations with China and foster regional stability.

Japan has, for a time, referred to China as a security threat to justify increased defence spending. At the end of 2022, Japan proposed increasing its total defence budget to 43 trillion yen (US$285.8 billion) from 2023 to 2027, reaching 2% of its GDP in 2027. On 27 December 2023, the Cabinet of Japan approved an unprecedented 115.5 trillion yen fiscal budget for 2025, with major spending increases in social security (38.3 trillion yen) and defence (8.7 trillion yen), both hitting record highs. The sharp depreciation of the yen will result in cost escalation in purchasing and maintaining expensive US military equipment.

With the Japanese government projecting economic growth for 2025 to be just 1.2%, the financial burden of healthcare, pensions and interest payments of government bonds will strain its finances. Unrestrained defence spending will reduce investments in technological innovation, further weakening Japan’s economic competitiveness.

Conversely, to allocate limited resources where it matters, military spending must be kept within reasonable limits. This will require improving Japan’s regional relations, with relations with China being crucial. If Japan continues to regard China as its greatest strategic challenge or as an imaginary enemy that poses a security threat, it will “misallocate” invaluable resources, ultimately damaging its own security and development interests.

Although Japan’s proactive shift in its China policy stems from its internal demand and internally-driven motivation, the above developments remain uncertain and dynamic. We must clearly recognise that there remains strong inertia in Japan’s externally-driven strategic autonomy tendency, which will pose ongoing challenges to China-Japan relations.

Despite the positive signals towards China by the Ishiba administration, dissenting voices have emerged within the LDP. With Ishiba’s political weaknesses, both domestically and within the LDP, it remains uncertain whether domestic political struggles will lead to drifts and shifts in Japan’s strategic perception and direction.

Focusing on China as a risk is an effective tool for Japan’s ability to set the global agenda, the importance of its existence, and its influence in shaping the narrative in terms of its externally-driven strategic autonomy tendency.

Japan’s efforts to build upon the China threat narrative on the global stage will persist. Its rhetoric at G7, NATO and other international platforms about China unilaterally using force to alter the status quo and challenge the rules-based global order is unlikely to change anytime soon. If Trump adopts an ultra-aggressive China policy and forces its key allies including Japan to take sides, it remains to be seen whether Japan can stand the test.

Related: Trump 2.0 and the building of autonomous China-Japan relations | Diplomatic schedule for China and Japan edging closer