Natural partners? Europe, Japan and security in the Indo-Pacific

Policy Paper

Introduction

Europeans and Japanese are often described as ‘natural’ partners. As liberal democracies, market economies and close allies of the US, they have similar world views and share many interests. They also have a long history of cooperation, whose foundations go back to Japan’s embracing of modernisation and industrialisation in the late 19th century along European lines.

Both during and after the Cold War, Europeans and Japanese have worked closely to uphold and promote the institutions that make up the liberal, rules-based international economic order, such as the World Trade Organisation (WTO), the International Monetary Fund (IMF), the World Bank (WB) and the G7. In more recent years, Europeans and Japanese have shown a keen interest in extending their cooperation to the security domain, both on a bilateral basis (ie, between Japan and individual European countries) and through the EU and NATO.

Given their shared values and interests, the foundations for a meaningful security relationship between Europe and Japan appear strong. Yet both sides continue to focus primarily on their immediate neighbourhoods and their respective relationships with the US. For Japanese and Europeans alike, the US has played an equally vital strategic role: guaranteeing security in their respective regions and upholding a liberal international political and economic order from which they have benefited enormously.

In recent years, significant geopolitical developments have altered the context in which both Europe and Japan operate, and may force the two sides to change the way in which they look at each other.

Russia and China have begun to challenge more openly and forcefully the rules-based liberal international order, both regionally and globally. The Russian and Chinese regimes are attempting to build an international order that is more in line with the political and economic interests of their ruling elites. They both seek to modernise their military capabilities and are engaging in acts of political intimidation and economic blackmail that threaten to disrupt the status quo in Europe and East Asia, respectively.

At the global level, Moscow and Beijing reject the notion of a liberal and open system, a level playing field where economic and political actors can compete freely. Instead, they prefer a controlled, top-down order. Geopolitically this translates into spheres of influence, whereby great powers call the shots and medium and small powers have no say, losing the certainty and protection offered by international rules and organisations and being left with nothing but the prospect of submission.

At the same time, it has become less clear in recent years –especially since the election  of Donald Trump as President– to what extent the US is willing to underwrite the current global trade and economic order. This has implications that are global –witness the Trump Administration’s seeming disdain for the WTO– as well as regional, given the US withdrawal from the Trans Pacific Partnership (TPP) and its equivocal position in relation to the Transatlantic Trade and Investment Partnership (TTIP).

When it comes to security, concerns about China’s rise, Russia’s growing assertiveness and the prospect of a relative US decline have sparked some doubts amongst Europeans and Japanese about America’s commitment to preserving deterrence in their respective regions. Uncertainty has been further fuelled by Trump’s rhetoric on alliances.

The developments mentioned above are compelling both Japanese and Europeans to adapt their respective foreign policy strategies. In recent years, Japan has adopted an increasingly active diplomatic and security role in East Asia, a process dubbed by some ‘normalisation’. Certainly, Tokyo has not abandoned the principles that have shaped its (pacifist) identity in the past decades and it continues to see military force as a last –defensive– resort. However, an increasingly threatening regional environment has led Japan to increase its defence budget, ease the legal restrictions on its Self-Defence Forces, strengthen its bilateral alliance with the US and expand its diplomatic and security ties with several countries across East Asia and the broader Indian Ocean region. This is reflected in Prime Minister Abe’s vision of a ‘Free and Open Indo-Pacific’ (FOIP).

Japan’s FOIP is partly a response to China’s Belt and Road Initiative (BRI), an attempt to re-order the Indo-Pacific and Eurasian spaces according to China’s priorities and rules. Moreover, in view of the growing uncertainty about Washington’s vision on trade, Tokyo has embraced the flagship of global free trade –including a robust defence of the WTO– and taken a leading position on TPP after the US withdrawal.

On the European side, a new debate has emerged around the concept of European ‘strategic autonomy’, underscored by the 2016 European Global Strategy. In this context, Europeans have embarked on a number of new initiatives aimed at strengthening European defence cooperation, both in the context of the EU (eg, Permanent Structured Cooperation, European Defence Fund, Coordinated Annual Review on Capabilities) and outside it (eg, European Intervention Initiative).

Moreover, Europeans remain committed to reinvigorating transatlantic trade and economic ties, and the notion that such ties can help raise global standards in key areas such as free trade and environmental protection. Indeed, after European Commission President Jean-Claude Juncker’s meeting with Trump in July 2018, the idea of some form of ‘TTIP light’ has emerged.

Against the backdrop of these broader geopolitical changes, Europe and Japan have shown a growing interest in strengthening their strategic ties with each other. The progressive normalisation of Japan’s foreign and security policy and opening up of its defence industry has paved the way for greater security and defence cooperation with Europe. The UK and France have led the way, stepping up their military and defence-industrial cooperation with Japan in recent years, and countries like Italy and Spain are following suit. Germany, for its part, has developed a growing diplomatic and economic interest in Japan, a country with which it shares a preference for rules and multilateralism.

The rising cooperation in European-Japanese relations goes beyond individual countries and has also affected Europe’s collective institutions. The EU and Japan have recently concluded the negotiation of their Economic Partnership Agreement (EPA), the biggest bilateral trade agreement ever negotiated by the EU. The EU-Japan EPA promises important direct economic benefits for both parties. More broadly, however, it signals that the EU and Japan consider free trade to be the backbone of a multilateral liberal order. In addition to the EPA, the EU and Japan have concluded a Strategic Partnership Agreement (SPA) that aims to lay more solid foundations for deeper political and security ties between Japan and the EU. The SPA will be ‘a legally binding pact covering not only political dialogue and policy cooperation, but also cooperation on regional and global challenges, including environment and climate change, development policy and disaster relief, and security policy’.

Japan has also taken a number of steps to strengthen its relationship with NATO. This has resulted in a number of practical initiatives in recent years, such as the secondment of a Japanese Self-Defence Forces officer to NATO headquarters and the official designation of its Embassy to Belgium as its Mission to NATO, which was accepted by the North Atlantic Council in June 2018.

The strengthening of Europe-Japan relations –perhaps best illustrated by the EPA-SPA–  is a timely phenomenon. With a US President following a disruptive approach towards international trade, and an uncertain US commitment to the global economic order, Japan and the EU –the two other key pillars of the liberal global economic order– are not only holding the fort but deepening their economic, political and security ties. The shared challenge in the years to come is to engage the US and bring it back into the fold of the liberal, rules-based international order. After all, and despite current problems, the US remains essential to the security of both Europe and Japan, as well as for the integrity and stability of the liberal international order.

The big shadow looming over European-Japanese relations is China. For many years Europeans have looked at Asia –and the broader Indo-Pacific region– primarily as a place for business. European business, especially German, has built strong ties with China and such economic ties have paved the way for political and diplomatic links between Europe and China. Thus, a key question for the future is how Europeans will balance their economic interdependence with China and their growing interest in developing security and economic ties with Japan, especially as Beijing’s neo-mercantilist approach and challenging of international rules clashes with Tokyo’s vision of a Free and Open Indo-Pacific.

About this Policy Paper

Against the backdrop of these geopolitical changes, and given the growing interest on both sides, it is appropriate to take stock of the European-Japanese relationship and explore the potential for increasing cooperation. This paper’s aim is to explain how Europe’s key players and institutions are approaching Japan, and to outline some possible ways to move the relationship forward.

With security at the centre of the exercise, the paper more specifically focuses on the Indo-Pacific, a concept so far officially embraced by the Japanese and US governments but that offers much potential to Europeans –to the extent that the Indian Ocean remains Europe’s main gateway into what some argue will be an Asia-Pacific century. However, we approach the Europe-Japan relationship through the lens of one of the sides: Europe.

In a way, the question of how to frame security cooperation with Japan in the Indo-Pacific is a proxy for a broader question: how will Europeans position themselves at a time increasingly defined by the shift in the global centre of strategic and economic gravity towards the Indo-Pacific?

In this paper a group of experts address these questions from the viewpoint of Europe’s main powers and institutions, using Japan and the Indo-Pacific as a compass. How will Europe’s key players and institutions balance their relationship with China and Japan, and how will they navigate their competing approaches to rule and order in the Indo-Pacific? Put differently, how will they balance their economic interest in strong ties with China and their political and strategic interest in Japan, and their (supposed) alignment with Tokyo’s vision for a Free and Open Indo-Pacific? In addressing these broad questions, each of the authors has been given the editorial freedom to approach them through the lens and specificities of each individual case.

In the first essay, Céline Pajon examines France’s efforts to step up its security cooperation with Japan in recent years. In particular, France’s military and defence-industrial prowess, its maritime capabilities and its status as an Indian-Ocean power open up important opportunities for greater security cooperation with Japan. In the second essay, Philip Shetler-Jones depicts the UK’s relationship with Japan as a ‘quasi-alliance’ underpinned by a long history of cooperation and their common nature as sea-borne powers.

While France and the UK –two maritime powers with global interests– have stepped up military cooperation with Japan, Germany is also increasingly interested in deepening ties with Tokyo but is primarily stressing diplomacy and shared norms, as explained by Ulrich Speck in the third essay.

Europe’s other maritime powers (Italy and Spain) are also showing an increasing interest in the security of the Indo-Pacific and in building stronger security ties with Japan. As Alessio Patalano’s contribution shows, Italy sees Japan as a like-minded country and is sympathetic to Tokyo’s vision of upholding a Free and Open Indo-Pacific. In particular, Italy has shown interest in working with Japan in East Africa, where its longstanding economic and political ties converge with Tokyo’s emphasis on connectivity and infrastructure development. Similarly supportive of the concept of a Free and Open Indo-Pacific is Spain, which has signed a Strategic Partnership with Japan in 2018, as detailed by Mario Esteban and Elisa Lledó.

In the sixth essay, Jacek Bartosiak looks at Japan and the Indo-Pacific from the point of view of Poland. While its continental location may make the connection with Japan (and the Indo-Pacific) less obvious, Poland’s condition as Europe’s gateway to China’s BRI makes it an interesting case. More broadly, as Bartosiak points out, there is a significant parallelism between Poland and Japan, as they are both emerging as the centrepieces of the US-led regional deterrence architecture in Europe and East Asia, respectively.

Europe’s multilateral institutions have also shown a growing interest in Japan. As Lisa Picheny points out, NATO and Japan consider themselves ‘natural partners’ and have a history of cooperation in the Alliance’s mission in Afghanistan. And in recent years NATO and Japan have strengthened their cooperation even further as they now hold annual consultations and are cooperating on a number of specific projects, including in the area of cyber-defence.

In the final essay, Daniel Fiott discusses the EU’s growing interest in Japan in the context of the EPA-SPA and looks more closely at the potential for greater security cooperation. Certainly, Brussels continues to look at Japan primarily through an economic and diplomatic lens and is trying to maintain a degree of neutrality with regard to territorial conflicts in the Indo-Pacific. But the revamping of the EU’s Common Security and Defence Policy and the EU’s growing interest in defence research and innovation could open up greater opportunities for engaging with Japan.

Luis Simón & Ulrich Speck

Conclusions

Europe’s security and ability to remain a global player hinge in no small part on its ability to project influence in the Indo-Pacific space, for that is emerging as the central nervous system of both the global economy and global geopolitics. Europeans have a direct stake in the preservation of a rules-based liberal order there. And that means they cannot remain on the side-lines in the unfolding process of great power competition in the area.

In order to project their interests and values in the Indo-Pacific space, Europeans need partners. This is where Japan comes in. Japan is of key importance to Europe for two main reasons. First, because Japanese and Europeans hold common values and have shared interests in relation to the Indo-Pacific as well as globally; secondly because among the several like-minded partners Europeans have in the Indo-Pacific, Japan stands out because of its critical mass, in particular its economic muscle, but also its diplomatic and security potential. In this context, Japan’s progressive normalisation of its security policy and its growing interest in the Indo-Pacific maritime axis open up a number of opportunities for Europe.

One of the main points emphasised in this report is that Europeans have indeed a growing interest in the Indo-Pacific and in strengthening their security ties with Japan. To be sure, Europeans do not want to become embroiled in territorial tensions in places like the South or East China Seas. Even the two European countries with a stronger military and global profile –the UK and France– insist that they do not want to take a firm stand on sovereignty-related questions. However, all of Europe’s key players and institutions have a position on matters of principle: in particular, they embrace the notion of an open and free maritime domain, free trade and a multilateral and rules-based approach to conflict resolution. These principles stand in sharp contrast to the notion of exclusive zones of influence, mercantilism and unilateral approaches to territorial conflicts.

It is the defence of these broader liberal principles that bring Europeans and Japanese together. In recent years, Japan has stepped up its security profile and emerged as one of the bastions of a free and open rules-based order in the Indo-Pacific. Its position stands in contrast to China’s increasingly assertive approach to territorial claims and neo-mercantilist efforts to re-order the Indo-Pacific space.

An important driver of Europe’s growing interest in Japan is the realisation by most of Europe’s key powers and institutions that China is unlikely to accept a multilateral, rules-based approaches to conflict resolution, as Beijing continues to assert its territorial claims with little regard for the interests and views of its maritime neighbours. The moment this became clear was when China reacted to the South China Sea Arbitration to the case brought by the Philippines against China under Annex VII to the UN Convention on the Law of the Sea (UNCLOS), concerning certain issues in the South China Sea including the legality of China’s ‘nine-dotted line’ claim. When on 12 July 2016 the Permanent Court of Arbitration ruled in favour of the Philippines, China flatly rejected the ruling, putting an end to the hope that international law could halt China’s challenge to the status quo in the region.

Besides Chinese assertiveness, there are other factors driving the current European-Japanese rapprochement. One key factor is the leadership role played by the UK and France. The two countries have a long history of engagement in the Indo-Pacific and have shown a growing interest in cooperating with like-minded powers (such as Japan, South Korea, Australia and India in recent years). They both see the Indo-Pacific as a key strategic arena and, as major military powers with a permanent seat at the UN Security Council, they feel the need to show their presence.

Additionally, there is the promise of cooperation in the defence industry domain. Japan’s edge in new generation technologies (e.g., autonomy, cyber, robotics, etc.) could be a key asset for Europeans as they seek to grapple with the challenges of military-technological innovation at a time when the US is embarking on its so-called third offset strategy. Greater cooperation in defence-industrial matters could help Europeans and Japanese diversify their partnerships in that field, reducing their technological-strategic dependence on the US, and reap mutual benefits in terms of defence innovation. In this regard, Europeans should explore how they can leverage the work of the European Defence Agency and the Commission’s newly established European Defence Fund to further their defence research and industrial cooperation with Japan.

Beyond security, another important driver of a closer Europe-Japan partnership is the sense that other dimensions of the liberal international order are also threatened. That includes, in particular, the free and open economic order that has allowed globalisation to thrive, and the institutions and norms that have enabled it to do so (such as the WTO and the broader principle of free trade). It is in this area where Germany has been particularly active by pushing for closing the EU-Japan trade deal and by offering Tokyo a closer partnership in the framework of the so-called ‘alliance of multilateralists’.

Regardless of the general openness and interest on Europe’s part to strengthen cooperation with Japan, there are also a number of important obstacles going forward. One of them is lack of unity. While there is a broad agreement among European players, forged in such forums as the EU and the G7 summits, each of them is moving ahead individually according to its national or institutional priorities. Overall this leads to a fragmentary approach. Alignment of Asia policies among Europeans could become even harder after Brexit, especially if disengagement is not balanced by new mechanisms for the coordination of foreign and security policies.

Another limiting factor is the need to balance support for the liberal order and like-minded countries in the region with the relationship with China. Europeans do not want to be put in a position where they have to side with one party or the other in the event of a heated territorial conflict in the Indo-Pacific. While there is increasing scepticism about the compatibility of the Chinese model of governance with the liberal order, the European economy remains deeply interconnected with China’s.

Last but not least there is geographical distance. Most European countries are focused primarily on their geographical neighbourhood. And in recent years the number and urgency of conflicts there has increased, from Ukraine to Syria. Only a few of the bigger European countries really feel that they have an important stake in the Indo-Pacific.

On balance, there is momentum for increased security cooperation between Europe and Japan. Europeans and Japanese are ‘natural partners’ who consider a liberal and rules-based international order to be a core interest. They are both particularly interested in the Indo-Pacific –a key lifeline for European-Asian trade– and in preserving a liberal and rules-based order there. They are both equally worried about the seemingly unwavering US commitment to multilateralism. And, critically, they both believe that greater engagement on their part could serve to both hedge against the prospect of US disengagement as well as constitute a powerful incentive to bring the US back into leading the liberal, rules-based order.

Luis Simón & Ulrich Speck