Updated March 27, 2024
U.S.-Japan Relations
Overview
leaders of the United States, Japan, and South Korea. The
Japan, a U.S. treaty ally since 1951, is an important U.S.
three leaders announced several initiatives for a “new era of
partner in several foreign policy areas, particularly security
trilateral partnership,” including pledges to convene
and trade. Shared security goals include meeting the
trilateral meetings at high levels (including an annual
challenge of an increasingly assertive People’s Republic of
leaders’ meeting), expand trilateral military exercises, and
China (PRC or China) and countering threats from North
abide by a “commitment to consult” on regional conflicts
Korea. The U.S.-Japan mutual defense treaty grants the
and challenges. Historically, trilateral cooperation has been
United States the right to base U.S. troops—currently
constrained by Japan-South Korea tensions regarding a
numbering over 50,000—and military assets on Japan’s
territorial dispute and sensitive historical issues stemming
territory in return for U.S. security guarantees to Japan.
from Japan’s colonization of the Korean Peninsula from
Japan is the sixth-largest U.S. trade partner and the largest
1910 to 1945. In 2023, Yoon and Kishida forged a bilateral
source of foreign direct investment into the United States,
rapprochement that has enabled the unprecedented trilateral
and its investors are the largest foreign holders of U.S.
cooperation. Some observers question whether this high
Treasury securities. The two countries also collaborate
level of cooperation will outlast the current leaders and
bilaterally and multilaterally on science and technology,
withstand possible flare-ups in Japan-South Korea relations.
global health, energy, and climate change. Congressional
The U.S.-Japan Military Alliance
oversight of U.S.-Japan relations generally focuses on
Since the early 2000s, the United States and Japan have
alliance cooperation—particularly on how Japan and the
improved the operational capability of the alliance as a
United States coordinate their China strategies.
combined force, despite Japanese political and legal
On April 11, 2024, Japanese Prime Minister Fumio Kishida
constraints. Japan has accelerated reforms to make its
is scheduled to address a Joint Meeting of Congress.
military (known as the Self-Defense Forces, or SDF) more
Kishida is the second Japanese leader to be given this
capable, flexible, and interoperable with U.S. forces. Japan
honor, and the first since 2015. On April 10, President
pays roughly $2 billion per year to defray the cost of
Biden is to host Kishida for a State Visit, during which the
stationing U.S. military personnel in Japan. In addition,
two leaders are expected to announce a major upgrade to
Japan pays compensation to localities hosting U.S. troops,
the U.S.-Japan alliance’s mechanisms for coordination.
rent for the bases, and the costs of new facilities. About
They also plan to hold a three-way summit with Philippines
25% of facilities used by U.S. Forces Japan (USFJ) and
President Ferdinand Marcos Jr.
over half of USFJ personnel are stationed in Okinawa, an
island chain that comprises less than 1% of Japan’s total
The Biden Administration positions the U.S.-Japan alliance
land area. Most Okinawans and Okinawan politicians
at the center of its Indo-Pacific strategy. Both the U.S. and
oppose elements of the U.S. military presence in Okinawa,
Japanese governments see China’s rising power and
and Okinawans have long expressed widespread opposition
influence as detrimental to their national security. President
to the construction of new U.S. bases in their prefecture.
Biden also has embraced the Quadrilateral Security
Japan Expands Its Defense Posture
Dialogue (“the Quad”) with Japan, Australia, and India as a
Japan is constrained in its ability to use military force by its
mechanism to advance shared goals in the region.
U.S.-drafted pacifist constitution, as well as Japanese
Japan has adopted more assertive security and foreign
popular hesitation to engage in military conflict. However,
policy postures since the early 2010s, providing the alliance
as perceived threats from North Korea and China have
with more flexibility to confront regional challenges.
grown more acute, Japan’s government and populace have
Japan’s proximity to China—and the two countries’
reconsidered the country’s approach to national security. In
maritime and territorial disputes—heightens Tokyo’s
2022, Kishida’s government released security documents
concern as well as its incentives to manage bilateral
that could chart a fundamental shift in the alliance and
tensions. Over the past decade, Japan has expanded
Japan’s approach to defending itself. The documents label
cooperation with India, Australia, and Southeast Asian
China as an “unprecedented strategic challenge,” declare
countries, a policy in tune with Biden’s desire for a
Japan’s intention to develop a “counterstrike” missile
“latticework” of “mutually reinforcing” regional coalitions.
capability to attack enemy missile sites, and outline plans to
Japan participates in the Biden Administration’s Indo-
increase Japan’s security-related expenditures to 2% of its
Pacific Economic Framework for Prosperity (IPEF), a
national gross domestic product (GDP), in line with NATO
regional economic and trade initiative.
standards. (Post-war Japan generally has limited defense
spending to 1% of its GDP.) If this increase takes effect,
U.S.-Japan-South Korea Relations
Japan’s defense budget could become the world’s third-
In August 2023, Biden hosted Prime Minister Fumio
largest. The documents do not specify how Japan would
Kishida and South Korean President Yoon Suk-yeol at
implement these goals, or to what extent Japan would
Camp David for the first-ever summit meeting between the
pursue them in tandem with the United States. Japan has,
https://crsreports.congress.gov
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U.S.-Japan Relations
with U.S. encouragement, expanded security cooperation
concerns over U.S. dependence on China for EV batteries
with Australia, the United Kingdom, and the Philippines.
and key EV components (e.g., processed critical minerals).
Regional Relations
Figure 1. Top U.S. Trade Partners, 2023
China and Taiwan. A perpetual challenge between Japan
and the PRC is a dispute between the two countries (as well
as Taiwan) over a group of uninhabited Japan-administered
islets in the East China Sea (known as the Senkaku Islands
in Japan, and Diaoyu in China). In the 2020s Tokyo and
Beijing have largely managed to keep tensions from
escalating, despite frequent operations near the islands by
PRC government vessels since 2012. As China has
increased economic, diplomatic, and military coercion of
Source: CRS; data from Bureau of Economic Analysis.
Taiwan, a former colony of imperial Japan (1895-1945)
In 2022, Japan joined 13 other countries as an inaugural
roughly 70 miles from Japan’s westernmost island, the
negotiating partner in the U.S.-led IPEF initiative, an
Japanese government has framed the prospect of cross-
economic arrangement that covers selected trade issues,
Strait conflict as an urgent challenge. Such a conflict could
such as digital trade, trade facilitation, labor, and the
involve U.S. and Japanese military personnel and assets in
environment, but not tariff liberalization or other market
Japan, especially in Okinawa. China is Japan’s top trading
access provisions. IPEF also addresses issues not typically
partner, accounting in 2023 for 20% of Japan’s total goods
covered in FTAs, like supply chain resiliency. As of
trade. (The U.S. share was 15%.)
November 2023, IPEF partners have announced agreements
in all pillars except for the trade pillar, which stalled over
Southeast Asia and the Pacific Islands. For decades,
key issues like digital trade. IPEF appears to be the Biden
Japan has pursued productive relations with Southeast
Administration’s response to concerns that the United
Asian countries, providing aid and earning broadly positive
States lacked a robust trade agenda in the region following
reviews from regional leaders. Japan has launched several
U.S. withdrawal from the proposed Trans-Pacific
initiatives to build partner countries’ maritime capabilities.
Japan’s approach generally complements U.S. policy
Partnership (TPP) in 2017. Some Members of Congress and
; both
partners like Japan have called for the United States to
the United States and Japan are pursuing strong relations
consider joining the 11-nation Comprehensive and
with the Philippines and Vietnam in particular and have
Progressive Agreement for Trans-Pacific Partnership
launched initiatives to cooperate on infrastructure projects
(CPTPP), which Japan helped form after U.S. withdrawal.
in Southeast Asia and the Pacific Islands.
Russia and Ukraine. Kishida’s government responded to
In December 2023, Japan’s Nippon Steel Corporation, the
Russia’s invasion of Ukraine forcefully, viewing Russia’s
world’s 4th largest steel producer in 2022, announced it had
aggression as a threat to the international rules-based order,
reached an agreement to acquire the U.S. Steel Corporation,
and drew potential parallels with PRC claims over Taiwan.
the 27th largest steel producer. The United Steelworkers
Japan has adopted most of the sanctions and other penalties
labor union and some Members of Congress have criticized
against Russia employed by the United States and Europe,
the proposed sale and urged the Biden Administration to
and provided humanitarian and material support for
review any potential national security implications of the
Ukraine despite Russia’s threats to curtail energy supplies.
transaction through the interagency Committee on Foreign
Economic and Trade Issues
Investment in the United States (CFIUS). Nippon Steel
indicated the deal has been submitted to CFIUS for review.
The United States and Japan are among the world’s largest
In a March 2024 statement, President Biden asserted “it is
economies. In 2023, Japan was the sixth-largest U.S.
vital for [U.S. Steel] to remain an American steel company
trading partner based on total goods and services trade
that is domestically owned and operated.”
(Figure 1). Japan is the top source of foreign direct
investment in the United States. The United States and
Japan’s Increased Political Uncertainty
Japan have two limited trade deals, which took effect in
Japan’s decade-plus of relative political stability, which has
2020, liberalizing some goods trade and establishing rules
provided a foundation for closer U.S.-Japan strategic
on digital trade.
alignment, may be eroding. In late 2023, Tokyo prosecutors
opened an investigation into allegations that powerful
Cooperation on supply chain resiliency and diversification
factions of Kishida’s ruling Liberal Democratic Party
has been a key economic priority for the U.S. and Japanese
(LDP) mis-appropriated campaign finances. The scandal
governments. Under this backdrop, the Japanese
has shaken the LDP and driven Kishida’s approval ratings
government and corporations have concerns over new
into the 20%-30% range, raising the possibility he may not
mineral-sourcing and localization requirements for electric
last until his three-year term as LDP president ends in
vehicle (EV) tax credits under P.L. 117-169, the Inflation
September 2024. Parliamentary elections do not need to be
Reduction Act of 2022 (IRA). In March 2023, the United
held until the summer of 2025.
States and Japan signed a critical minerals agreement,
which the Administration indicated will qualify Japan as a
Mark E. Manyin, Coordinator, Specialist in Asian Affairs
free trade agreement (FTA) partner for the purpose of
Cathleen D. Cimino-Isaacs, Specialist in International
meeting such requirements. Some Members of Congress
Trade and Finance
have criticized the lack of congressional involvement in the
agreement and Japan’s designation as an FTA partner. IRA
Caitlin Campbell, Analyst in Asian Affairs
provisions were motivated in part by U.S. policymakers’
https://crsreports.congress.gov
U.S.-Japan Relations
IF10199
Kyla H. Kitamura, Analyst in International Trade and
Finance
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https://crsreports.congress.gov | IF10199 · VERSION 36 · UPDATED