Japan is preparing to bring ammunition factories under state ownership while keeping day‑to‑day operations in private hands, a significant shift in Tokyo’s approach to defence industrial policy aimed at guaranteeing supplies if a crisis erupts.
Under the model being discussed — known by the acronym GOCO (government‑owned, contractor‑operated) — the government would own key production lines for shells and other munitions and contract private companies to run them. The Defence Ministry has begun talks with manufacturers and plans to fold the idea into revisions of Japan’s main security documents and a new defence‑industry strategy to be completed within the year.
The push reflects hard lessons from recent conflicts and a changing neighbourhood. The shortfalls in ammunition that plagued Ukraine after Russia’s 2022 invasion highlighted that stocks and surge production capacity can be as decisive as platforms on the battlefield. Japanese officials and ruling‑party advisers warn that under the present private‑sector‑led production model, stocks could be quickly consumed in a contingency.
The proposals go beyond shells. Tokyo is contemplating broader industrial reorganisation of defence divisions within private firms, touching on aircraft, submarines and other major programmes. The Liberal Democratic Party and coalition partners have already signalled support: party panels recommended state plants last year and GOCO language was included in a recent political agreement with the Japan Innovation Party.
National ownership of production capacity is meant to guarantee a minimum industrial backbone in wartime, ensuring production lines remain available even if private contractors falter or markets freeze. Supporters argue GOCO will improve surge capacity, secure supply chains and allow the state to prioritise production of critical items during geopolitical crises without relying solely on commercial incentives.
But the approach carries trade‑offs. State ownership can secure capacity but risks entrenching inefficiency and dampening private investment. Co‑ordinating responsibility between ministries, the military and defence firms will be politically sensitive and legally complex in a country that has long constrained military affairs. Firms may resist structural changes that could erode commercial autonomy or expose them to greater state direction.
Tokyo’s deliberations should also be read in regional and allied contexts. The United States and some European countries have taken steps to shore up munitions output and defence supply chains; Japan’s move would align it with a broader trend of governments treating defence manufacturing as strategic infrastructure. For Washington, a more resilient Japanese industrial base could increase burden‑sharing options, but it may also require new bilateral arrangements on procurement, technology sharing and industrial buy‑ins.
Implementation is likely to be gradual and contested. Policymakers aim to reflect the GOCO approach in this year’s security document revisions and a refreshed defence‑industry strategy, while continuing consultations with private firms. How Tokyo balances state control, efficiency, alliance interoperability and domestic political sensitivities will determine whether this becomes a decisive strengthening of Japan’s deterrent or a bureaucratic reshuffle with limited effect on battlefield readiness.