Japan Cancels High-Level Security Talks with U.S. Over Defense Spending Dispute

Published: June 21, 2025 | Tokyo/Washington

In a sharp diplomatic rupture ahead of a crucial NATO summit, Japan has cancelled its annual “2+2” security dialogue with the United States, following aggressive pressure from the Trump administration to significantly increase defense spending, according to a Financial Times report on Friday. The meeting, scheduled for July 1 in Washington, was to have featured U.S. Secretary of State Marco Rubio and Defense Secretary Pete Hegseth alongside their Japanese counterparts. Tokyo’s decision to withdraw—citing Washington’s recent push for Japan to hike its defense outlay from 3% to 3.5% of GDP—marks a serious fracture in bilateral coordination at a time of mounting regional security threats.

Defense Budget Push Sparks Diplomatic Friction Between Allies

The crux of the dispute centers on a revised U.S. demand that Japan raise its defense spending target to 3.5% of GDP, a notable escalation from the previously discussed 3%. The demand, reportedly conveyed in recent weeks by Elbridge Colby, the third-ranking official in the U.S. Department of Defense, has provoked unease within Tokyo’s policymaking circles. According to two senior Japanese officials cited by FT, the sharp uptick in expectations—particularly amid domestic electoral pressures—was seen as “unilateral and politically tone-deaf.” The Japanese government, already grappling with internal budgetary strain and sensitive public sentiment regarding militarization, found the U.S. insistence incompatible with its constitutional and strategic realities.

Highlights

• U.S. demanded Japan raise defense spending to 3.5% of GDP

• Request delivered by top Pentagon official Elbridge Colby

• Tokyo deemed pressure excessive and politically miscalculated

• Meeting cancellation reflects growing U.S.-Japan strategic tension

Also Read : HDB Financial IPO Pricing Jolts 50,000 Early Investors With Up to 48% Notional Loss

Quiet Confirmation from U.S. Officials as Diplomatic Fallout Grows

A senior U.S. official, speaking anonymously to Financial Times, acknowledged that Japan had “postponed” the July 1 meeting, though no official reason was given. Another Washington source, also unnamed, confirmed Japan had withdrawn but lacked insight into Tokyo’s motivations. Despite mounting media interest, U.S. State Department spokesperson Tammy Bruce declined to comment during Friday’s briefing, while the Pentagon remained silent. Japan’s embassy in Washington did not respond to inquiries, highlighting the diplomatic delicacy surrounding the episode. Analysts view the lack of coordinated public messaging as a sign of deeper unease within both administrations about the state of the bilateral security alliance.

Highlights

• U.S. confirmed Japan’s withdrawal but offered no public reasoning

• State Department and Pentagon have declined to comment

• Japan’s embassy in Washington also remained silent

• Lack of transparency signals deeper diplomatic discomfort

Broader Context: Defense Pressure Coincides with Trade Strains and Global Strategy Shift

This breakdown in talks comes amid a broader realignment of U.S. foreign policy under President Donald Trump’s second term, marked by heightened defense cost-sharing demands and tariff threats even toward traditional allies. Trump is reportedly preparing to press NATO allies next week to hike defense spending to 5% of GDP, up from the current 2% guideline—a move already sparking anxiety across Europe. Tokyo has also been navigating tough trade talks with Washington, with Trump’s administration pushing for greater market access and alignment on tariffs. The overlapping pressure points—defense, trade, and technological cooperation—are contributing to a systemic rebalancing of Japan-U.S. relations, one that may not recover easily.

Highlights

• Trump aims to push NATO nations toward 5% GDP defense spending

• Japan faces U.S. pressure on both trade and military fronts

• Tokyo wary of U.S. strategic overreach in Asia-Pacific region

• Signals a recalibration of the Japan-U.S. alliance under Trump 2.0

Colby’s Role Under Scrutiny as Allies Express Concern Over Pentagon’s Assertiveness

Elbridge Colby, the architect of the U.S. demand, has increasingly come under scrutiny from both domestic and foreign quarters. Known for his hawkish views on China and his advocacy of “integrated deterrence”, Colby is also reportedly reviewing key strategic agreements like the AUKUS submarine pact with Australia and the UK, which has led to parallel tensions in Canberra. Diplomats from multiple allied countries have expressed concern over the Pentagon’s shift toward unilateralism, which some see as undermining alliance cohesion. “This is not how allies negotiate,” said one European official, pointing to the absence of pre-negotiation consultations. Within Japan, officials have privately expressed frustration over Colby’s confrontational style and disregard for regional sensitivities.

Highlights

• Elbridge Colby is spearheading defense pressure campaign

• Also reviewing the AUKUS submarine agreement, sparking Australian unease

• Allies accuse Pentagon of unilateralism under Colby’s leadership

• Japan privately critical of Colby’s strategic diplomacy style

Domestic Political Pressures in Japan Influence Timing of Cancellation

While defense demands were the apparent catalyst, insiders suggest Japan’s domestic political context also played a decisive role in the cancellation. With Upper House elections scheduled for July 20, Prime Minister Shigeru Ishiba’s Liberal Democratic Party is projected to lose seats. Facing voter sensitivity over defense budgets and foreign policy subservience, Ishiba’s cabinet reportedly calculated that proceeding with the July 1 meeting under U.S. pressure would damage electoral prospects. Earlier in March, Ishiba had publicly rebuffed U.S. calls for defense hikes, stating, “Other nations do not decide Japan’s defense budget.” The meeting’s cancellation, then, serves both geopolitical and domestic political purposes.

Highlights

• Upper House elections in Japan scheduled for July 20

• LDP anticipates seat losses and seeks to avoid defense budget backlash

• Ishiba has previously rejected U.S. influence on budget decisions

• Meeting cancellation seen as both strategic and electoral maneuver

Strategic Implications: Asia-Pacific Security Architecture Under Strain

The cancellation of the “2+2” dialogue could have far-reaching implications for regional security coordination, especially amid rising tensions in the South China Sea, Taiwan Strait, and Korean Peninsula. The annual meeting is a cornerstone of U.S.-Japan strategic dialogue, enabling joint planning, intelligence sharing, and regional posture alignment. With China stepping up military drills around Taiwan and North Korea preparing for another missile test, the absence of high-level synchronization between Tokyo and Washington may embolden adversaries and sow uncertainty among regional partners. Analysts warn that unless repaired quickly, this rift may undermine broader Indo-Pacific deterrence efforts.

Highlights

• ‘2+2’ talks critical for joint military planning in Asia-Pacific

• Cancellation risks misalignment amid China, North Korea tensions

• Lack of U.S.-Japan coordination could embolden adversaries

• Urgency grows for diplomatic repair before regional escalation