From 10% to 42%: How Australia's US Alliance Revitalised Japan Defence Cooperation, Strengthening relationships australia

Hook

Australia’s deepening US alliance acted as a catalyst that pushed Japan to expand joint defence activities from 10% to 42% of its budget. The shift reflects a strategic recalibration across the Indo-Pacific, where partners are aligning resources to counter shared security challenges.

In my experience as a relationship coach, I often compare the dynamics of personal partnerships to the way nations negotiate trust and commitment. When a third party - like a mutual friend - steps in, it can either complicate the bond or, if managed well, strengthen it. The US-Australia partnership has become that mutual friend for Japan, offering a reliable bridge that encourages deeper collaboration.

The historical roots of Australia-Japan defence cooperation stretch back to the early 1990s, but the pace accelerated after the 2016 joint declaration that linked Australian forces more closely with U.S. Pacific commands. By 2022, Japan earmarked roughly 10% of its defence spending for bilateral exercises with Australia. Fast-forward to 2026, and that figure has surged to 42% according to the latest Stimson Center briefing on shipbuilding cooperation.

Why did this happen? Two interlocking trends provide the answer. First, the United States has signaled a renewed commitment to the Indo-Pacific through the “pivot” strategy, encouraging allies to share the burden of regional stability. Second, Australia’s own defence budget has risen dramatically, reaching 2.1% of GDP in 2025, a level that signals willingness to fund high-intensity joint training and capability development.

According to the CSIS report on the U.S.-Japan alliance, the United States now expects its partners to contribute more to joint maritime patrols, missile defence drills, and cyber-security exercises. Australia, already a trusted partner in the Five Power dialogue, has stepped up, providing platforms such as the Hobart-class frigates that can operate alongside Japanese destroyers in the East China Sea.

From a relational perspective, the increase mirrors what I call the "investment principle" - the more you invest in a partnership, the more resilient it becomes. Japan’s decision to allocate a larger slice of its defence budget to joint work with Australia signals a willingness to deepen trust, share intelligence, and coordinate operational planning.

At the same time, the 35% of Japan’s defence budget earmarked for joint exercises with Australia that remains untouched, as highlighted in recent media coverage, underscores a lingering hesitation. This unused portion reflects bureaucratic inertia and the need for clearer rules of engagement, something I have seen in couples who agree on a shared goal but struggle to translate intention into daily action.

"A surprising 35% of Japan’s defence budget earmarked for joint exercises with Australia remains untouched despite rising US-Australia commitments." - recent defence analysis

When I worked with a senior Australian naval officer in 2023, he described the atmosphere at a joint planning workshop in Sydney as "energising" but also "laden with paperwork". The sentiment echoed across both navies: strategic intent is high, yet operationalizing that intent requires time, resources, and a clear governance structure.

Data from the Stimson Center shows a clear upward trajectory in shipbuilding cooperation, with joint projects increasing from 2 vessels in 2018 to 7 vessels slated for delivery by 2030. This quantitative growth aligns with the qualitative shift in trust between the two partners.

Beyond hardware, defence diplomacy has blossomed through people-to-people exchanges. Since 2020, the annual Australia-Japan Defence Forum has attracted over 300 senior officials, analysts, and academics, fostering a network that mirrors the relational ecosystems I facilitate in my coaching practice.

In terms of Asia-Pacific security, the expanded collaboration reduces the strategic gap that China’s naval modernization has created. Joint exercises now routinely involve anti-submarine warfare drills, missile-defence simulations, and cyber-resilience scenarios that mirror real-world threats.

Looking ahead, the trajectory suggests that Japan may aim for parity with Australia’s contribution, potentially moving the joint-exercise budget share beyond 50% within the next decade. Such a move would cement the US-Australia alliance as the linchpin of a broader, multilateral defence architecture that includes India, the United Kingdom, and other regional partners.

In my work, I often remind couples that the healthiest relationships are those where each partner feels both supported and challenged. The same principle applies to nations: Australia feels supported by the United States, and Japan feels challenged to raise its own capabilities, creating a virtuous cycle of improvement.

Key Takeaways

• US-Australia alliance fuels Japan’s defence budget shift.
• Joint exercises rose from 10% to 42% of Japan’s spending.
• 35% of earmarked funds remain unused, indicating friction.
• People-to-people exchanges deepen strategic trust.
• Future growth could push joint-exercise share past 50%.

While the numbers tell a compelling story, the human element remains essential. During a joint training exercise off the coast of Queensland in early 2025, I observed Japanese and Australian sailors sharing meals, swapping stories about hometowns, and even teaching each other local slang. Those informal moments build the cultural fluency that underpins successful operational coordination.

From a policy perspective, the India-Australia ECTA analysis notes that bilateral economic partnerships often precede security cooperation, suggesting that the commercial ties between Australia and Japan - particularly in technology and renewable energy - reinforce the defence relationship. As businesses deepen interdependence, governments find it easier to justify increased defence spending that protects shared economic interests.

Critics argue that the rapid escalation could provoke an arms race, especially with China’s assertive posture in the South China Sea. Yet the CSIS briefing emphasizes that transparent, multilateral exercises serve as confidence-building measures, reducing the likelihood of miscalculation.

In practice, the operational tempo has risen. The Australian Defence Force now conducts quarterly joint war games with the Japan Maritime Self-Defense Force, compared with an annual cadence a decade ago. This frequency mirrors the "regular check-ins" I recommend for couples seeking to maintain connection and resolve emerging issues.

Finally, the broader implication for Australia-Japan relationships is clear: a robust US alliance can act as a catalyst, but the sustainability of the partnership depends on consistent, mutual investment. Just as I counsel partners to balance give and take, nations must balance strategic ambition with realistic resource allocation.

Frequently Asked Questions

Q: Why has Japan increased its defence budget share for joint exercises with Australia?

A: Japan’s rise from 10% to 42% reflects the strategic reassurance provided by the US-Australia alliance, the need to counter regional threats, and the desire to deepen interoperability with trusted partners.

Q: What does the unused 35% of earmarked funds indicate?

A: The idle portion highlights bureaucratic hurdles and the need for clearer rules of engagement, suggesting that intent alone is not enough without effective implementation.

Q: How does defence diplomacy complement economic ties between Australia and Japan?

A: Economic interdependence, especially in technology and renewable energy, creates a foundation of shared interests that makes deeper security cooperation politically viable and mutually beneficial.

Q: What role does the United States play in this evolving partnership?

A: The US acts as a strategic anchor, encouraging allies like Australia to share the burden of regional security, which in turn motivates Japan to align its defence spending with joint objectives.

Q: Could this growing alliance trigger regional tension?

A: While increased military activity can raise concerns, transparent multilateral exercises serve as confidence-building measures that mitigate the risk of miscalculation among regional powers.