Kawasaki Hamstrung By Government Stance On Military Exports (excerpt)
(Source: Bloomberg News; posted June 14, 2017)
by Isabel Reynolds
An executive at one of the country’s biggest defense companies has bemoaned government barriers to exporting military equipment, as changes to the law have failed to bring the bonus some expected for the domestic industry.

Speaking at Kawasaki Heavy Industries Ltd.’s booth at the MAST defense convention in Chiba Prefecture, the company’s senior manager for its naval ship sales department said the government needed to rethink its required processes.

“Basically, it’s impossible for us to just go out and sell things,” Toshihide Takao said Monday. “It’s a question of what the government wants to do. If the government doesn’t make a move, we can’t either.”

While admirals from foreign navies expressed interest at the conference in adopting Japanese technology, strict guidelines limit defense equipment cooperation to cases deemed by the government to contribute to international peace or Japan’s own security. These regulations add a layer of complexity that’s left Kawasaki’s marine division unwilling to take a proactive stance on exports.

The last time KHI exhibited at the conference it was in the running to sell a fleet of the world’s largest conventionally powered submarines to Australia. Two years later, it’s offering a small rescue sub.

KHI, along with Mitsubishi Heavy Industries Ltd., was part of a public-private Japanese consortium competing against established exporters from other countries for the $39 billion contract. But Australia’s selection in April last year of France’s DCNS SA as its partner poured cold water on Abe’s ambitions.

The bid came after Prime Minister Shinzo Abe lifted a decades-old ban on military exports in 2014 as part of his drive to strengthen the military and deepen international ties amid tensions with North Korea and China. But the long-pacifist country has struggled to win high-profile contracts, turning instead to smaller projects, including joint development and transfers of used equipment to Southeast Asia. (end of excerpt)

Click here for the full story, on the Bloomberg News website.


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