Japan and the Middle East: Navigating U.S. Priorities and Energy Security

How have Prime Minister Shinzo Abe’s efforts to recalibrate Japan’s foreign policy affected his approach to the Middle East? Japanese policy in the region has often been forced to balance between U.S. priorities and Tokyo’s own energy security needs.

While Washington’s entanglements in the region are multiple and complex owing to numerous interests, security alliances, and close ties with Israel, Japan prefers not to pick favorites and seeks to maintain a realpolitik, economic-focused policy repertoire.

There are clear strategic motives for Tokyo’s approach. Japan is highly dependent on fossil fuels, and in turn highly dependent on the Middle East for its energy needs, importing close to 90% of its crude oil from the region.[1] Japan is consistently a top importer of Middle East oil. Japan’s trade balance with the Middle East at the end of 2018 was valued at $22 billion in exports and 93.8 billion in imports. Its top trading partners in the region are Saudi Arabia, UAE, and Qatar.[2] Though attempts have been made to diversify Japan’s sources of energy over the years, the 2011 “triple disaster,” which led to Japan shuttering most of its nuclear plants, only reinforced these dependencies.

The result, as we argue below, is that even on those rare occasions when Japan has shown signs of a more activist foreign policy in the Middle East, the pendulum tends to swing back to a cautious, energy security-focused approach that reflects caution, neutrality, and the avoidance of military entanglements.

Japan and the Middle East: A History of Oil Dependency

The 1970s oil shocks that resulted from the OPEC embargo hit Japan hard. For a time, Tokyo abandoned its neutrality to side with the Palestinians in their conflict with Israel, a policy dictated by its immense need for Middle East oil.[3] Over time, a muscular U.S. military presence in the Persian Gulf helped ensure that shipping routes for Japanese oil imports would remain secure.

The 1991 Gulf War was a watershed moment for Japan in the Middle East. Unable to deploy troops in support of the UN Security Council-sanctioned war effort, Japan participated by underwriting the costs of the war. It was a politically safe way to satisfy U.S. demands without becoming too deeply involved. Yet, despite pledging $13 billion in support of Kuwait’s liberation, Japan’s effort was criticized as “checkbook diplomacy.” Former senior diplomats told us how dismayed Japanese officials were that a full-page advertisement in The Washington Post placed by Kuwait failed to count Japan among the coalition countries that contributed to the liberation effort.

In the 2003 Iraq War, then-Prime Minister Junichiro Koizumi broke from Japan’s non-interventionist approach to the region. After months of pressure from the George W. Bush Administration and public debate about the nature of Japan’s role in Iraq, in early January 2004 a Japan Self-Defense Forces Iraq Reconstruction and Support Unit consisting of 600 soldiers deployed to Samawah, in British-occupied southern Iraq. The location was chosen in large part because it was not an active combat zone. Rhetorically, Tokyo described the participation in terms that emphasized Japan’s support for Iraq and the Iraqi people, and said little about the U.S. military and the controversial invasion. The deployment was Japan’s largest since World War II and appeared to signal that, in the wake of 9/11 and new security challenges, Tokyo would more closely align itself with U.S. objectives in the Middle East.

Polls at the time showed that the deployment was opposed by more than half of the Japanese public, a number which only grew as the situation on the ground in Iraq deteriorated.[4] It was only in July 2006, bowing to public pressure and opposition from within his own party, that Koizumi withdrew its contingent from Iraq, though he maintained a small Air Self-Defense Forces unit (ASDF) in the region until December 2008.

The Middle East and Abe’s New Activism

Prime Minister Abe came to power in December 2012 promising a new approach to Japanese foreign policy. Early in his tenure, Abe began his efforts to lessen restrictions on Japan’s use of force overseas, which in 2016 resulted in legislation permitting Japanese participation in collective self-defense. At the time, there was much speculation that Abe’s security doctrine of proactive pacifism, which sought to recast Japan’s role overseas into one that would take more responsibility for the maintenance of international peace and security, could be tested in the Middle East.

Indeed, in 2015 Abe announced a new, activist Middle East policy.[5] Tokyo was to now play a greater role in shaping the future of the Middle East through engagement on a host of issues ranging from humanitarian assistance and development to security.[6] Abe’s message was thus warmly received in Washington.

It was also clear however that Abe’s policy would be constrained by a traditional Japanese preference for caution. After the U.S. announced the formation of an international coalition to fight the Islamic State in 2015, Abe chose not to provide any military or logistical support to the anti-ISIL campaign. He, did, however, pledge $2.5 billion in regional humanitarian and development assistance, including $200 million in non-military assistance to the effort. Similarly, Japan offered financial and technical support for European Union (EU) missions in Niger and Mali, while avoiding the deployment of peacekeepers.[7] Abe wanted to send a strong message that Japan was committed to playing an active role in contributing to regional peace and security without committing any troops.[8]

Even with the announcement of a new approach to the Middle East, Abe has pursued the stable relations that Japan has always craved in the region. In a 2015 speech, Abe emphasized Japan’s special role by drawing an implicit contrast between Japan’s policies toward the Middle East and those of Europe and the U.S. The message was that Japan would not take sides, or seek to interfere in the region’s interstate conflicts or internal problems. When setting out the core tenets that guide Japanese policy, Abe used three Arabic terms to describe Japan’s approach: al-tasaamuh (harmony and tolerance), al-ta’aaish (coexistence and co-prosperity) and al-ta’aun (collaboration).[9]

Since the election of U.S. President Donald Trump, Abe has again recalibrated. In the security realm, Trump’s presidency has brought uncertainty to the U.S-Japan alliance. As a candidate, Trump suggested that South Korea and Japan should defend themselves. As president, he floated a drawdown of troops in the two countries.[10] Moreover, Trump shocked the Japanese leadership when he announced a June 2018 summit with North Korean leader Kim Jong Un without input from Tokyo.[11] In the economic realm, Trump removed the U.S. from the Trans Pacific Partnership, on which Abe had expended significant political capital domestically owing to the pact’s unpopularity. Finally, despite Japanese lobbying and Abe’s “burgers-and-golf” diplomacy, the Trump administration hit Japan with the same steel tariffs levied in spring 2018 against many other countries.

All of this has made it even more difficult for the U.S. to secure Japan’s support for U.S. regional priorities for the Middle East. Iran serves as a good example.

Japan’s Relationship with Iran, Before and After Trump

Perhaps no other country in the Middle East has generated more tension between Tokyo and Washington than Iran. Just as U.S. Vice President Mike Pence was excoriating Iran at a summit on Middle East security in Warsaw, Iranian Parliament Speaker Ali Larijani was in Tokyo to meet Abe.[12] Outreach to Tehran at times of heightened tensions with the U.S. is not new. Even at the peak of the Iran hostage crisis in 1979-1980, Japan continued to buy Iranian oil on spot markets, an act which drew condemnation from Washington.[13]

 Indeed, in the decades following the 1979 revolution, Japan never fell fully into line with Washington’s demands to isolate Iran and wean itself off of Iranian oil. While Japan always had access to alternative sources of supply, the cheaper price of Iranian crude is attractive for Japanese companies. Japan imported US$3.5 billion worth of Iranian crude in 2017, making Iran its sixth largest source that year.[14]

Even in 2004, the year Japan dispatched troops to Iraq in support of the U.S. led occupation, it was clear that Japan’s participation in the U.S.’s “coalition of the willing” in Iraq did not mean that Japan would fall in line with U.S. policy toward Iran. Parallel to the Iraq deployment, Japan also sought to develop Iran’s lucrative Azadegan oilfield.[15] Tokyo eventually abandoned Azadegan in 2010 after sustained pressure from Washington,[16] only to see part of the field handed to China’s National Petroleum Company.[17] During the stringent sanctions regime that was introduced by the U.S. and EU in 2012, Japan scaled back its imports, but never completely ended them.[18]

The 2015 Joint Comprehensive Plan of Action (JCPOA) presented an opportunity for Japan to buy cheaper Iranian crude, expand its trade relationship with Iran, and to compete with China over bids to develop Iran’s infrastructure, including the prospect of exporting high speed rail technology.[19] Like the EU, Japan hoped not to lose out on lucrative trade deals in Iran to strategic competitors like China.

However, when President Trump announced in May 2018 the U.S. withdrawal from the “worst deal ever” and the re-imposition of sanctions on Iran, Japan’s pivot to Iran was placed in peril. Abe, who had hoped to be the first Japanese head of government to make an official visit Iran in four decades, hastily cancelled his planned trip to Tehran, which was to take place just two months after Trump’s exit from the JCPOA.[20] At the same time, Japan’s business community sought assurances from Abe that they would not be cut off from the Iranian market.[21] All Abe could offer was a commendation to Iran for its continued compliance with JCPOA in September 2018.[22] Once again, Tokyo was between a rock and a hard place, balancing between Washington’s sensitivities on Iran and its own economic interests.

Japan gained a reprieve in November 2018 when it received a waiver from U.S. sanctions, allowing Tokyo to continue buying Iranian oil. This waiver has a May 2019 expiry date, making imports thereafter uncertain.[23] Nevertheless, Japan has continued to collaborate with the EU to keep the JCPOA alive. Over the course of 2018, when EU worked to establish a mechanism that would allow their firms to continue to invest in Iran, the United Kingdom turned to Japan for its decades of expertise in avoiding U.S. sanctions while buying Iranian oil and entering into insurance contracts.[24]

While some analysts suggested that Japan’s dependence on U.S. security commitments, combined with its efforts to diversify its sources of energy over the past decade, would lead Tokyo to fall in line with the Trump administration,[25] such expectations are premised on an underestimation of the importance Tokyo has attached to expanding investment in Iran and the extent to which Japan has remained vulnerable to even small disruptions in oil supply, particularly after the 2011 Fukushima meltdown. Moreover, Japan wants to offer an alternative to China, whose $900 billion Silk Road Initiative has made it the top source of FDI in the region.[26]

Policy Implications

What does this mean for Japan’s role in the broader Middle East? As has always been the case, Tokyo will engage in delicate balancing. Abe will not shirk from working to protect Japanese economic interests in Iran. The recent Abe-Larijani meeting may be a sign of this. Abe may also simply “wait out” the Trump administration, avoiding any high-profile initiatives vis-à-vis Iran that would antagonize the U.S. While Japan may be dependent on Middle East oil, it is also dependent on the U.S.-provided security umbrella. Abe may also try to act as an intermediary between Tehran and Washington; his recent meeting with Larijani may signal such a role.

At the same time, Tokyo is highly unlikely to enter into any future U.S.-led regional military deployments that would disrupt delicate relationships with Japan’s regional trading partners. Abe’s government has focused on winding down existing peacekeeping missions in which SDF forces are involved rather than joining new ones. In the end, Japan will continue to base its policy on ensuring access to stable sources of energy, while Tokyo’s security concerns will focus on its neighborhood, especially North Korea and China.