Emma Chanlett-Avery, Coordinator
William H. Cooper
Specialist in International Trade and Finance
Mark E. Manyin
Specialist in Asian Affairs
post-World War II U.S.-Japan alliance has long been an anchor of the U.S.
security role in East Asia. The alliance facilitates the forward
deployment of about 36,000 U.S. troops and other U.S. military assets in
the Asia-Pacific, thereby undergirding U.S. national security strategy in the region.
For Japan, the alliance and the U.S. nuclear umbrella provide maneuvering room
in dealing with its neighbors, particularly China and North Korea.
When a devastating earthquake and tsunami hit Japan on March 11, 2011,
U.S.-Japan relations were stable but still recovering from a difficult
period in 2009-2010. The Democratic Party of Japan’s (DPJ’s) landslide
victory in the August 2009 elections for the Lower House of Japan’s legislature
marked the end of an era in Japan; it was the first time Japan’s Liberal
Democratic Party (LDP) was voted out of office. The LDP had ruled Japan
virtually uninterrupted since 1955. Since the resignation of the DPJ’s
first prime minister, Yukio Hatoyama, in June 2010, bilateral relations
have been smoother under the leadership of Naoto Kan and Yoshihiko Noda. The
party appears to have shifted its strategic thinking after a series of
provocations from North Korea and indications of growing assertiveness
from the Chinese military in disputed waters in 2010. The massive and
immediate relief provided by the United States following the March 11 disaster bolstered
the relationship further.
Difficult problems remain in the alliance, particularly in resolving problems
related to the stationing of marines on Okinawa. In April 2012 the
governments agreed to relocate several thousand marines elsewhere in the
region, but have been unable to make serious progress on implementing a
2006 agreement to relocate the controversial Futenma Marine Air Station to a
less densely populated location on Okinawa. Futenma Air Base remains open
and presents a risk of an accident or crime that could exacerbate
local-base relations further. In addition, concerns and uncertainty about
the cost of the realignment plans has drawn criticism from several U.S. senators,
putting funding at risk.
Japan is one of the United States’ most important economic partners. Outside of
North America, it is the United States’ second-largest export market and
second-largest source of imports. Japanese firms are the United States’
second-largest source of foreign direct investment, and Japanese investors
are the second-largest foreign holders of U.S. treasuries, helping to finance
the U.S. deficit and reduce upward pressure on U.S. interest rates.
Bilateral trade friction has decreased in recent years, partly because
U.S. concern about the trade deficit with Japan has been replaced by concern
about a much larger deficit with China. One exception was U.S. criticism over
Japan’s decision in 2003 to ban imports of U.S. beef, which have since
resumed, but on a limited basis.
However, the economic problems in Japan and the United States associated with
the credit crisis and the related economic recession, together with the
impact of the March 11 disasters, have played a role in the bilateral
economic agenda. Japan has been hit particularly hard by the financial
crisis and the subsequent economic downturn. Japan’s gross domestic product
(GDP) declined 1.2% in 2008 and 5.3% in 2009 but grew 4.0% in 2010. It
declined 0.7% in 2011. However, the major focus of discussions has been on
Japan’s expressed interest in joining the Trans-Pacific Partnership (TPP)
and under what conditions Japan might join. .
Date of Report: May 4, 2012
Number of Pages: 34
Order Number: RL33436
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