Issue:
January 2026 | Cover story 2
A more assertive China will complicate Japan’s security ties with the U.S.
Sanae Takaichi’s approach to foreign and defense policy as prime minister borrows heavily from her mentor Shinzo Abe’s vision: a stronger Japan, pursuing greater strategic autonomy, with the U.S. alliance as the cornerstone and China as the foremost strategic concern. Takaichi’s core foreign policy challenge in her first full year in office will be to apply that philosophy to an evolved context, with Beijing increasingly assertive in the region and Washington’s focus apparently elsewhere.
Just as after Abe’s December 2013 Yasukuni Shrine visit, Beijing’s response to Takaichi’s November remarks on Japan’s response to a hypothetical Taiwan contingency creates a politically useful opportunity for a staunch conservative leader to demonstrate a tough posture toward China. But the difficult task of managing the diplomatic and economic fallout will be the most urgent item on Takaichi’s diplomatic agenda in early 2026. Japan is less dependent on China than a decade ago in areas such as rare earths, but it still relies heavily on China for export demand (including tourism) and supply chains, meaning that prolonged or intensified tensions could cause significant disruption at a time of anemic growth in the Japanese economy.
Japan-China tensions are also complicating Takaichi’s efforts to manage the alliance with the U.S., which will remain the bedrock of Japan’s national security strategy for the foreseeable future despite trade frictions in 2025. Donald Trump’s prolonged public silence on China’s response, coupled with the careful neutrality of Secretary of State Marco Rubio’s recent remarks, will only fan concerns in Tokyo about Washington’s long-term strategic dependability, which grew in 2025 following the Trump administration’s course shift on Ukraine.
If Takaichi visits Washington in March — ahead of Trump’s expected April trip to Beijing — she will seek to build on the personal rapport established during the Trump’s trip to Tokyo last November. She will also be keen to quickly finalize the first tranche of Japan-funded projects in the U.S. as part of the $550 billion investment deal, even as somewhat differing interpretations raise concerns about whether the headline figure will ever be realized. Takaichi will also pursue closer U.S.–Japan cooperation on economic security, and hope that the goodwill generated by the investment deal will smooth potentially fractious discussions about Japan’s future defense spending levels and a new host nation payment deal to succeed the one expiring at the end of FY2026.
Takaichi’s diplomatic engagements with other partners in the year ahead will likely be read in the context of reducing Japan’s security and economic reliance on the U.S. She has defied early skeptics by maintaining the recent upward trajectory of Japan-South Korea relations, with a possible summit with Lee Jae-myung in her hometown of Nara in January offering a near-term opportunity to re-embed “shuttle diplomacy”. The 2023 institutionalization of trilateral relations at Camp David will provide ongoing momentum, though Takaichi’s occasional propensity to speak out on sensitive issues will remain a risk.
Security ties with Australia and the Philippines should continue to improve, and New Zealand could play a more prominent partnership role, particularly if Wellington follows Canberra in ordering Japan’s Mogami-class frigate platform. Takaichi is also likely to build on her fall summitry in Kuala Lumpur and Gyeongju by offering deeper economic, developmental, and security engagement to Southeast Asia, partnerships that should continue to deepen given Tokyo’s concerns about growing Chinese influence and declining U.S. interest in the sub-region. And while Takaichi may be less active in pursuing the truly global diplomatic role for Japan than Abe and Fumio Kishida aspired to as prime minister, she will continue to build ties that strengthen Japan’s economic and economic security interests, with European partners, the Gulf states, Central Asian republics, and others.
National security and defense will be a major focus for Takaichi in 2026, with her decision to pursue an early revision of the three framework national security documents creating an opportunity to reshape the medium-term trajectory of Japan’s defense posture. Recent speculation about reviewing the three non-nuclear principles could be part of an effort to shift the Overton window and create space for Tokyo to acquire nuclear-propelled submarines, though it also reflects those growing doubts about Washington’s strategic dependability.
Takaichi might wish to repeat the significant defense-spending hike announced in the 2022 National Security Strategy, though bond market sensitivities to the government’s fiscal position will inevitably curtail her room for maneuver. Even so, the domestic defense industry looks set to benefit from Takaichi’s policy choices this year, beginning with an easing of defense hardware export restrictions that could come as soon as March.
Dr. James Brady is Vice President and Japan analysis lead with Teneo's Geopolitical Risk Advisory team.
