Can Takaichi Win the Tax Cut Battle?

Dispute over Takaichi’s Proposed Consumption Tax Cut

By Takuya Nishimura, Senior Fellow, Asia Policy Point
Former editorial writer for the Hokkaido Shimbun
You can find his blog, J Update here.

August 17, 2026

Prime Minister Sanae Takaichi announced on July 30 that she would introduce legislation to reduce the consumption tax rate for food from eight percent to one percent. She hoped the reduction would take effect in April 2027 and continue for two years. The rate would return to eight percent in 2029. Although the national council she launched has not yet reached a consensus on this issue, Takaichi had before her two affordability options: a tax cut or a cash handout. Without meaningful discussion with others, Takaichi picked the former. Even some lawmakers in the ruling Liberal Democratic Party (LDP) opposed Takaichi’s arbitrary decision.

A consumption tax cut was originally a plank in the platform of the opposition parties for the Lower House election in February 2026. Recognizing its appeal to the voters, Takaichi took a similar approach for the LDP but with the cut limited to food and to a two-year period, after which the eight percent rate would return. A refundable tax credit would then be introduced. That was Takaichi’s plan.

After achieving victory in last February’s Lower House election, Takaichi launched the multi-partisan National Council for Social Security to discuss and implement her plan. Why social security? That is because revenue from the consumption tax is designed to be spent on social security. The Japan Communist Party and Sanseito were excluded from the council because they had opposed the refundable tax credit. The council had an arbitrary nature from the beginning.

The council failed to reach a consensus. The leading parties, supposedly backed by Takaichi, proposed a reduction in the consumption tax rate on food from eight percent to one percent and an additional cash handout equivalent to the remaining one percent of the consumption tax. The parties sought the same economic effect as the complete elimination of the consumption tax on food. The opposition parties demanded the opposite of what Takaichi later proposed: a cash handout rather than any reduction in the tax rate.

The interim report that the council submitted to Takaichi on July 29 was nothing more than an enumeration of opinions of the parties. They all at least agreed on a cash handout based on family income starting in fiscal year 2029. The council effectively turned down a refundable tax credit because a tax credit would require complicated reform of the taxation system. The council replaced the credit with a cash handout.

It was the next day when Takaichi decided to pick the brains of the leading parties. She advocated for a de facto moratorium on the consumption tax on food for two years and the introduction of another cash handout based on family income. Takaichi tends to make unilateral decisions, leaving minority opinion behind, when she fails to achieve a consensus on an important issue. This habit was seen in the reform of the Imperial House Law in which she insisted on patrilinear succession to the throne of the Emperor.

Takaichi requested the LDP to approve her tax reduction/cash handout plan by early August. However, multiple disputes arose in a meeting of the LDP Research Commission on the Tax System on July 31. One controversy is whether Japan has the fiscal resources to support a tax cut. The moratorium on the consumption tax cut for two years will cost ten trillion yen. Takaichi has not revealed a viable resource for her policy, only referring to some vague reform in spending.

This ambiguity about the fiscal resources for a consumption tax cut has already caught the attention of the markets, which are decidedly skeptical. Although Takaichi reiterated that the tax cut would not require the government to issue more bonds, the long-term interest rate hit a new high in these past three decades. The Japanese yen kept depreciating, inviting coordinated intervention by the governmental authorities of Japan and the United States.

At the meeting of the LDP, lawmakers erupted in frustration. “Finding a resource for the tax cut must be our promise to the voters,” said former Minister of Defense Tomomi Inada, calling for a cash handout instead of a tax cut. Other lawmakers referred to the difficulty in the resumption of the tax rate two years later. An immediate return to eight percent from one percent will mean a noticeable tax increase for taxpayers. “I’ll be responsible for the resumption of the tax rate,” said Takaichi, but no one can guarantee that she will still be the prime minister in 2029.

Having seen an abrupt drop in the approval rating for her cabinet, Takaichi is bent on a consumption tax cut, convinced that the policy can restore her popularity. But the discussion on the consumption tax rate is showing signs of political struggle.

Tomomi Inada is one of the female leaders who would be expected as an alternative to Takaichi. She firmly protested the bill for easing conditions for retrial that was proposed by the Ministry of Justice. Another possible female leader, former Minister of Economy, Trade and Industry Yuko Obuchi, stepped down as a core member of the LDP commission on the tax system. Both are frustrated with Takaichi’s arbitral process in deciding such highly important policy as consumption tax cut. 

This internal dispute on a single issue in the LDP reminds us of the sharp opposition over postal reform during Prime Minister Jun-ichiro Koizumi’s tenure in the early 2000s. Facing firm opposition from veterans in the LDP, Koizumi employed populism for his agenda backed by a high approval rate. He labeled those rivals “as protesting powers” against reform and accomplished the postal reform by ousting the protesters from the party. That was called “theater politics” in which a hero defeats bad guys. Can Takaichi be as clever as Koizumi in handling party politics?

The LDP officially approved Takaichi’s consumption tax cut plan on August 5. Takaichi’s allies in the party rallied for implementing her agenda. But some LDP lawmakers are still skeptical about cutting the consumption tax, which is a fiscal resource for welfare policies for aged people. There promises to be an intensive discussion on the tax cut bill in the fall session of the Diet.

The Future of American Competitiveness

The U.S. Needs to Fund Research to Be Competitive

Michael Schiffer, Senior Advisor at Scalare Advisors, Senior Fellow at the Center for American Progress, and APP Member.

First Published August 19, 2026 on the American Leadership Initiative Substack.

The United States is in the midst of a fundamental reconsideration of its economic relationship with the rest of the world. Tariffs, export controls, investment screening, supply-chain diversification and efforts to bring manufacturing back to American soil have moved from the margins of economic policy to its center. The rationale is straightforward: in a world of geopolitical competition and vulnerable supply chains, the United States cannot afford to depend on foreign sources for technologies and products that are essential to its economic and national security.

While this premise has broad support, there is a legitimate debate over how tariffs should be designed, how broadly they should be applied, and what costs Americans should be willing to bear in pursuit of greater economic resilience. But there is a more fundamental question that has received less attention: what happens if the United States uses trade policy to encourage production at home without maintaining the scientific, technological and industrial capabilities needed to make that production competitive?

Trade policy can change the incentives facing American companies. It cannot, by itself, create the engineers, scientists, technicians, factories, research institutions and supply chains that allow those companies to compete.

Much of American innovation has its roots in government funded research. The land-grant universities that trained generations of engineers, DARPA’s investments that helped produce the internet, and the NIH research infrastructure that has generated generations of medical discoveries were all the products of Americans making long-term bets on the country’s productive capacity and backing those bets with public resources to build the infrastructure, knowledge and human capital on which private enterprise could flourish.

That model of public investment is more important now than ever because the nature of international economic competition has changed. China and other countries are investing heavily in advanced manufacturing, artificial intelligence, biotechnology, energy and the infrastructure that supports them. Companies are reconsidering where they manufacture and source critical inputs. Governments are competing for investment and technological talent. Supply chains are being reorganized not only according to cost and efficiency, but according to resilience and national security. The result is a new economic landscape in which trade policy and domestic investment are inseparable. And success will require combining open markets with technological leadership, industrial policy, and worker training with secure economic partnerships.

The semiconductor industry provides perhaps the clearest example. The CHIPS and Science Act reflected a recognition that advanced semiconductor manufacturing is not simply another industry. Chips underpin virtually every modern economy, from automobiles and telecommunications to artificial intelligence and defense. The program’s early results suggested that targeted industrial policy could generate tangible benefits: CHIPS-funded projects created tens of thousands of jobs and raised wages in affected communities. Semiconductor manufacturing jobs now average $57.78 an hour, demonstrating that investments in advanced manufacturing can anchor high-value economic activity in American communities while strengthening capabilities essential to national security.

The engineers and scientists who develop new technologies do not appear when policymakers decide that a particular supply chain has become strategically important. They emerge from universities, laboratories and research programs that require years of sustained investment.

This is why reductions or uncertainty in federal research funding matter to economic competitiveness even when the immediate objective is fiscal restraint. The damage is rarely visible in a single budget year. It appears later, in the technology that is never developed, the company that is never founded, the researcher who takes a position elsewhere, or the manufacturing facility that chooses a different country because the surrounding ecosystem is stronger. In addition to growing investment in federal R&D, we must increase investment in U.S. STEM education, as well as reopen immigration to high skilled workers from around the world.

The United States has seen this dynamic before. Google’s origins, for example, can be traced in part to a National Science Foundation grant to two Stanford graduate students. The lesson is not that every government-funded research project produces a Google. It is that the economic returns from public investment in science are often unpredictable, long-term and vastly larger than the original investment.

That makes the current debate over trade policy particularly consequential. The administration has increasingly used tariffs and other trade measures to encourage domestic production, including in semiconductors and critical materials. The logic is understandable: if foreign dependence creates strategic vulnerability, changing the price and availability of imports can encourage companies to build capacity in the United States. Recent trade measures on semiconductors and polysilicon explicitly connect import policy with strengthening domestic supply chains.

But a tariff is an instrument, not a strategy. It can change relative prices. It can discourage dependence on a foreign supplier. It can give domestic producers greater room to compete. What it cannot do is determine whether American companies have the technology, workers, energy, infrastructure and supplier networks needed to take advantage of that opportunity.

If policymakers want companies to manufacture more in America, the country must also have the research institutions, skilled workforce, infrastructure, energy, component suppliers and technological ecosystems necessary to support it, and invest in the capabilities that allow American companies and workers to compete when market incentives change.

A serious American industrial strategy does not require Washington to decide which individual companies should succeed. It requires government to build the conditions in which strategically important industries can succeed: world-leading research, a skilled workforce, reliable and affordable energy, modern infrastructure, access to capital, predictable investment incentives and trade relationships that expand markets while reducing dangerous dependencies. Tariffs and trade policy are one component of that strategy, not a substitute for the entirety of it.

For decades, the argument was that trade policy, technology policy and economic statecraft had direct consequences for American wages, jobs and communities. That connection remains real. A semiconductor factory creates jobs not only inside the fab but throughout a regional network of suppliers. A research university trains the scientists and engineers those companies will eventually need. A federal research grant can generate technologies that become the foundation of entirely new industries.

The reverse is also true. Weakening those ecosystems can make otherwise sensible trade and industrial policies less effective.

Nor should industrial strategy stop at the water’s edge. The United States does not need to produce every important input domestically. But it does need to ensure that America and its allies collectively possess the capacity to produce the technologies, materials and components on which our prosperity and security depend. Building resilient economic partnerships with trusted countries should be treated as part of industrial strategy itself.

Americans can disagree about tariffs and the appropriate role of government in the economy. They can disagree about how much protection domestic industries should receive and how quickly supply chains should be reshaped. But if the United States is going to ask American workers to compete in a more contested global economy there should be consensus that we need to make sure they have the tools to do so.

The objective is not simply to return to an era when efficiency and low consumer prices were the only measures of a successful trading system. The objective should be capacity: the ability to innovate, manufacture, adapt and compete when circumstances change.

And that is ultimately how today’s trade policies should be judged. Tariffs can change the terms on which Americans trade with the world. Export controls can limit access to sensitive technologies. Supply-chain policies can reduce dangerous dependencies.

But none of those tools can substitute for the underlying capabilities of a competitive economy.

The United States has spent generations building those capabilities. The challenge now is to make sure that, even as we rethink how America trades with the world, we do not neglect the investments that determine whether America can continue to lead.

Asia Policy Events, Week of August 23, 2026

Asia Policy Point is on summer recess, like the U.S. Congress. We will, however, post some events weekly for our readers and members. If you want to receive the full Asia Policy Calendar, you have to become a "member" of APP. An individual, nonshareable membership is only $105/year and includes our occasional papers of on Japanese politics and access to our office while visiting Washington. SIGN UP HERE.

Week of August 23, 2026

IMPORTANT EVENTS

8/18-24 -King of Jordan Abdullah II ibn Al Hussein pays a state visit to China.
8/19-22 - Chinese Foreign Minister Wang Yi visits South Korea and Indonesia.

8/21 -  Annual Ulchi Freedom Shield exercise with South Korea ends. The exercise began on Aug 17 concludes one week earlier than scheduled by order of President Trump. Associated live-training events have been reduced, with certain events canceled or converted to simulations.”

8/23 - Kazakhstan holds snap parliamentary elections.

8/23 – 1939. Molotov Ribbentrop Pact (non-aggression Treaty between Nazi Germany and the Soviet Union) signed. Germany-Soviet alliance enabled WWII.

8/23 - Singapore Prime Minister Lawrence Wong gives his 3rd annual address to mark the independence of the city-state. 

8/23-24 - Kuwait Foreign Minister Sheikh Jarrah Jaber Al-Ahmad Al-Sabah pays an official visit to China.
8/23-25 - Mexican Foreign Secretary Roberto Velasco Álvarez visits South Korea.

8/25 - Kuwait Foreign Minister Sheikh Jarrah Jaber Al-Ahmad Al-Sabah pays an official visit to South Korea.

8/23-27 - World Water Week.

8/24 - Coalition of the Willing meets  in the Ukrainian capital of Kyiv to discuss continued support for the embattled country. The date of the meeting is significant, as it marks 35 years since Ukraine declared independence from the Soviet Union. Ukraine Independence Day.

8/24-26 - Inaugural Silk Road Finance & Technology Forum, Tashkent, Uzbekistan.
8/24-27- 2026 Nuclear Energy Conference and Expo (NECX), Dallas, Texas.
8/27-29 - Jackson Hole Economic Policy Symposium 2026, Jackson Hole, Wyoming. 
8/29 – 1949. Russia’s first nuclear test, RDS-1.
8/29 – International Day against Nuclear Tests.
8/29 – 1945. First POW camp on the Home Islands of Japan evacuated, Omori on Tokyo Bay and the nearby Shinagawa “hospital,” which rescuers said was “an indescribable hellhole of filth, disease, and death.” (Today, the Heiwajima Motor Boat Racing venue is located at the site of this former POW camp on the artificial island built by the POWs. The camp held Louis Zamperini and Pappy Boyington. Motor boat race gambling was established by unindicted Class A war criminal and black marketeer Ryoichi Sasakawa and remains controlled by his organization, the Nippon Foundation and revenue supports the Sasakawa family of foundations).
8/30 – 1945. General Douglas MacArthur, Supreme Commander of the Allied Powers (SCAP), arrives in Japan at the Atsugi airfield near Yokohama aboard Bataan II.

8/30-9/4 – 55th Pacific Islands Forum Leaders Meeting held in Koror, Republic of Palau.

8/31 - Seoul's Central District Court sentences Ms. Han Hak-ja, 83 , leader of the Family Federation for World Peace and Unification, commonly known as the Unification Church, for on charges of political fund violations and bribery involving former first lady Kim Keon Hee.

8/31-9/1 - G20 Finance Ministers and Central Bank Governors Meeting, Asheville, North Carolina,

8/31-9/1 - Bled Strategic Forum, Bled, Slovenia.

MEETINGS, CONFERENCES, AND SEMINARS

BOMBING IS NOT VERIFICATION: THE LIMITS OF STRIKES ON IRAN’S NUCLEAR PROGRAM. 8/24, Noon (EDT), VIRTUAl. Sponsor: Council on Strategic Risks. Speakers: Andrew Weber, Former Assistant Secretary of Defense for Nuclear, Chemical and Biological Defense Programs; Rose Gottemoeller (Former Deputy Secretary General, NATO; Moderator; Mallory Stewart, Former Assistant Secretary of State for Arms Control, Verification, and Compliance.

AI AGENT CONTAINMENT FAILURES: TECHNICAL REALITIES AND POLICY RESPONSES. 8/24, 2:00-4:00pm (EDT), HYBRID. Sponsor: CSIS. Speakers: Representative Suhas Subramanyam (D-VA), Member, Cybersecurity, Information Technology, and Government Innovation Subcommittee; Ian Reynolds, AI Policy Manager, Hugging Face; Helen Toner, Executive Director, The Center for Security and Emerging Technology; Mackenzie Arnold, Director of US Policy, LawAI; Aalok Mehta, Director, Wadhwani AI Center; Matt Pearl, Director, Strategic Technologies Program.

BEYOND THE TALIBAN: FIVE YEARS OF AFGHAN RESILIENCE AND RESISTANCE. 8/25, 10:00am-3:00pm (EDT), VIRTUAL. Sponsor: National Endowment for Democracy. Speakers: Ryan Crocker, Former U.S. Ambassador to Afghanistan; Nick Schifrin, Foreign Affairs and Defense Correspondent, PBS NewsHour; Annie Pforzheimer, Former U.S. Senior Foreign Service Officer; Minister Counselor (Retired); Melanne Verveer, Executive Director, Georgetown Institute for Women, Peace and Security Former U.S. Ambassador-at-Large for Global Women’s Issues; Adela Raz, Director, Afghanistan Policy Lab, Princeton School of Public and International Affairs. Former Afghanistan Ambassador to the U.S.; Lotfullah Najafizada, CEO, Amu TV; Fawzia Koofi, Former Deputy Speaker of the Afghan Parliament and Founder, Women for Afghanistan; Mariam Safi, CEO, Organization for Policy Research and Development Studies; Wazhma Frogh, Human Rights Lawyers and CEO, Women and Peace Studies Organization; Nasir Andisha, Founder, Center for Dialogue and Progress, and Permanent Representative of Afghanistan to the UN in Geneva; Parwiz Kawa, Executive Director, 8AM Media; Damon Wilson, President and Chief Executive Officer, National Endowment for Democracy.

PRESS CONFERENCE: HOW WILL OKINAWA’S NEXT ELECTION IMPACT JAPAN? 8/25, 1:00-2:00pm (JST), MIDNIGHT-1:00am (EDT), HYBRID, Sponsor: Foreign Correspondents' Club of Japan (FCCJ). Speakers: Naomi Machida, Head of the Ginowan Churamizu Kai; Takamatsu Gushiken — Head of Gamafuya.

ENGAGING NAYPYIDAW IN 2026: BANGKOK AND NEW DELHI’S CONSIDERATIONS. 8/25,  2:30-4:00pm (SGT), 2:30-4:00am (EDT), VIRTUAL. Sponsor: ISEAS Yusof Ishak Institute. Speakers: Dr Lalita Hanwong, Assistant Professor, History Department at Kasetsart University in Bangkok, Thailand; Dr V.S Seshadri, Senior Fellow for Economic Security at the Delhi Policy Group. 

THE CHALLENGE OF GULF-CHINA TIES: REASSESSING BEIJING’S ROLE AFTER THE IRAN WAR.  8/25, 10:00-11:00am (EDT), VIRTUAL. Sponsor: Arab Gulf State Institute. Speakers: Mohammed Al-Sudairi, Senior Researcher, King Faisal Center for Research and Islamic Studies; Aaron Glasserman, Distinguished Fellow, Weatherhead East Asian Institute, Columbia University; Chuchu Zhang, Associate Professor of International Relations, School of International Relations and Public Affairs, Fudan University; Moderator: Robert Mogielnicki, Non-Resident Fellow, AGSI. 

EVALUATING THE FUTURE OF U.S.-SOUTH KOREA-JAPAN TRILATERALISM. 8/25, 10:00-11:00am (EDT), HYBRID. Sponsor: Korea Economic Institute. Speakers: Eun A Jo, Assistant Professor of Government, William and Mary; Ayumi Teraoka, Assistant Professor of Politics, Brandeis University; Bruce Klingner, Senior Fellow, The Maureen and Mike Mansfield Foundation; Moderator: Arius Derr, Director of Communications, Korea Economic Institute of America. 

THE LIMITS OF IDEOLOGICAL ALIGNMENT. 8/26, 10:00-11:00am (EDT), VIRTUAL. Sponsor: American German Institute. Speakers: Zsuzsanna Végh, DAAD/AGI Research Fellow, American-German Institute; Program Officer, German Marshall Fund of the United States (GMF); Moderator: Eric Langenbacher, Senior Fellow and Director of the Society, Culture, & Politics Program, American German Institute.

THRIVING, SURVIVING, ZOMBIFYING OR DYING: WHAT FUTURE FOR USMCA. 8/26, 11:00am (EDT), VIRTUAL. Sponsor: Quincy Institute for Responsible Statecraft.  Speakers: Juan Carlos Baker Pineda, CEO and founding partner, Consultores Internacionales Ansley; Simon Lester, nonresident fellow, Baker Institute International Economics Program; Rachel Ziemba, adjunct senior fellow at the Center for a New American Security (CNAS); Moderator: Karthik Sankaran, senior research fellow in geoeconomics in the Global South program, Quincy Institute.

WHY AMERICA IS RUNNING OUT OF MUNITIONS. 8/26 1:00pm (EDT), VIRTUAL. Sponsor: Foreign Policy. Speakers: Tom Karako, Director, CSIS’s Missile Defense Project; Moderator: Ravi Agrawal, Editor in chief, Foreign Policy.

BOOK TALK: HEAVEN DOES NOT BLOCK ALL ROADS: A HISTORY OF TAIWAN THROUGH THE LIFE OF HUANG CHIN-TAO. 8/26, 4:00pm (EDT) IN PERSON ONLY. Sponsor: Yokosuka Council on Asia-Pacific Studies. Speakers: Anna Beth Keim, freelance journalist who has been reporting on Taiwan since 2015; Moderator: William Yale, Yokosuka Council on Asia-Pacific Studies. PURCHASE BOOK  

A VISION FOR THE FUTURE OF MULTILATERALISM. 8/26, 4:00pm (EDT), HYBRID. Sponsor: Stimson. Speaker: Rafael Grossi,Director general of the International Atomic Energy Agency.  

REMAKING US–CHINA ECONOMIC RELATIONS FOR ECONOMIC HEALTH AND GEOPOLITICAL STABILITY. 8/27, 1:00pm (EDT), VIRTUAL. Sponsor: Quincy. Speakers: Susan Helper, Frank Tracy Carlton professor of Economics at the Weatherhead School of Management, Case Western Reserve University; Jonas Nahm, Andrew W. Mellon Associate Professor, Johns Hopkins School of Advanced International Studies (SAIS); Marcus Stanley, director of studies, Quincy Institute; Jake Werner, director of the East Asia Program, Quincy Institute.  

AI AND AUTONOMY ON THE MODERN BATTLEFIELD. 8/27, 3:45pm (EDT), HYBRID. Sponsor: Atlantic Council. Speakers: Gen. (ret.) James Cartwright, USMC, Board Member, Atlantic Council, 8th Vice Chairman, Joint Chiefs of Staff; Owen J. Daniels, Nonresident senior fellow, Forward Defense, Atlantic Council; Moderator: Joe Costa, Director, Forward Defense, Atlantic Council.

Asia Policy Events, Week of August 16, 2026

Asia Policy Point is on summer recess, like the U.S. Congress until August 31. We will, however, post some events weekly for our readers and members. If you want to receive these directly to your mailbox, you have to become a "member" of APP. An individual, nonshareable membership is only $105/year and includes our occasional papers of on Japanese politics and access to our office while visiting Washington. SIGN UP HERE.

Week of August 16, 2026

8/3~16 - Beidaihe Annual Summer Chinese leadership meetings, Qinhuangdao, Hebei, PRC. The list of invitees to the annual gathering, as reported by state media, suggests that China’s leaders are placing a heavy emphasis on science, innovation and entrepreneurship, 
8/10-14 - Under Secretary of War for Policy Elbridge Colby visits Philippines, Indonesia, Thailand, and Cambodia. First official trip to Southeast Asia as Under Secretary of War for Policy. MANILA SPEECH, PRESS CONFERENCE.
8/12 - South Korea's Supreme Court confirms a decision requiring Japan's Nippon Steel to compensate the relatives of a Korean national who endured forced labor under Japan's occupation at its Kamaishi Steelworks. 
8/13 - Russian President Vladimir Putin makes his first visit to one of four Russian-held western Pacific islands (Iturup, known in Japan as Etorofu) seized after WWII that Japan calls its Northern Territories.
8/14 – Memorial Day for Japanese Forces’ Comfort Women Victims, South Korea.
8/14 – 1991. South Korean comfort woman victim Kim Hak-sun became the first to give public testimony about her experience.

8/15 - 1945. Imperial Japan accepts the Potsdam Declaration and ceases combat operations. Shūsen-kinenbi (Memorial Day for the End of the War in Japan). National Memorial Service for the War Dead at the Nippon Budokan hall in Tokyo with the Emperor and prime minister. 
     As expected, Japanese Prime Minister Sanae Takaichi did not make her usual visit Yasukuni Shrine and sent an offering instead. However, Upon arriving at Nippon Budokan hall to attend her first war memorial ceremony since taking office last year, Takaichi turned toward the Yasukuni Shrine across the road and bowed twice, clapped twice and bowed once in an apparent act of Shinto worship from a distance. She did visit the Chidorigafuchi National Cemetery for War Dead down the street from the Yasukuni Shrine. Her Memorial statement also made no mention of "remorse." [APP wrote about Prime Minister Ishiba's reinsertion of "remorse" in the annual memorial statement after its removal by Prime Minister Abe.] Defense Minister Shinjiro Koizumi, Minoru Kiuchi, economic and fiscal policy minister, Kimi Onoda, economic security minister, and Hitoshi Kikawada, in charge of issues related to Okinawa and the Northern Territories did visit the Shrine. Senior LDP officials -- Secretary General Suzuki, Haruko Arimura, head of its General Council, and Yasutoshi Nishimura, head of its Election Strategy Committee -- went to the Shrine as well. On the same day, South Korean President Lee Jae-myung emphasized in his remarks for Liberation Day "that Korea-Japan cooperation is more important than ever, The light of the new Korea-Japan relationship that we will create is To those who are still enduring pain in the shadows of history It must be able to be a source of warmth." 

8/15 -  USS George Washington departs the Pacific and expected to replace the USS Abraham Lincoln in the Middle East leaving the Western Pacific without an American aircraft carrier. Next day Trump orders the scaling back of the upcoming U.S.-South Korea exercises.
15 – Annual Far Eastern Prisoners of War (FEPOW) Day in Taiwan hosted by Taiwan POW Camps Memorial Society. 
8/15-16 - Panda Fest DC 2026, Washington, DC, outdoor Asian food festival with experiential activities, tastings, and market fairs.
8/17 - 1926. Centenary of the birth of late Chinese leader Jiang Zemin. Xi to speak at commemoration.
8/17 – Independence Day, National Holiday, Indonesia.
8/17-27 - 26th Annual Ulchi Freedom Shield exercise with the U.S. and South Korea held in South Korea. On the 16th, Trumps tells Hegseth to scale them back!!
8/19 – 1945. Several dozen British, Dutch, and American senior officers including Lieutenant Generals Jonathan Wainwright and A.E. Percival located by the OSS at the Hsian POW camp, 150 miles north of Mukden (today's Shenyang, China).
8/20-21 - Religious Freedom in Asia: Representation, Restrictions and Rights hosted by the Asia Centre Bangkok.
8/21 – 1945. Japanese authorities decide to set up the Recreation and Amusement Association (RAA) for the benefit of Allied occupation troops modeled on the military government’s long-established Comfort Women system.

8/22-23 - Freedom 250 Grand Prix street circuit: NTT INDYCAR SERIES. First-ever automotive race around the National Mall and the historic streets of Washington, DC. Veterans of the NTT trade wars will be amused that Japan's NTT is now encircling the National Mall. 
8/23 - Singapore Prime Minister Lawrence Wong gives an annual address to mark the independence of the city-state. 
8/23-27 - World Water Week.

KEIRIN: JAPAN'S WARRIORS ON BICYCLES. 8/17, 6:45pm (BST), IN PERSON ONLY. Sponsor: Japan Society-UK. Speakers: Joe Truman, British Track Cyclist; author, Justin McCurry, Japan and Korea correspondent, The Guardian, War on Wheels: Inside Keirin and Japan’s Cycling Subculture; Moderator: Jim McCafferty, Director, Reynolds Technology. PURCHASE BOOK. NB: Keirin is a major off-budget source of funding (managed by METI) for Japan’s electronics industry.

BEYOND PYONGYANG: REGIONAL DEVELOPMENT, MODERNIZATION, AND INEQUALITY IN NORTH KOREA. 8/17, 8:00-9:00pm (EDT), VIRTUAL. Sponsor: Stimson, 38 North. Speakers: Martyn Williams, Senior Fellow, 38 North Program; Iliana Ragnone, Research Analyst & Managing Editor, 38 North Program; Moderator: Jenny Town, Director, 38 North Program.

THE HORMUZ IMPLICATIONS FOR ENERGY POLICYMAKING: JAPAN AND SOUTH KOREA. 8/18, 8:00-9:00am (EDT), VIRTUAL. Sponsor: CSIS, Energy Security and Climate Change Program. Speakers: TERAZAWA, Tatsuya, Chairman and CEO, IEEJ, Japan; Jae-Seung Lee, Professor, Jean Monnet Chair in College & Graduate School of International Studies (CIS & GSIS), Korea University; Jane Nakano, Senior Fellow, Energy Security and Climate Change Program.

SOUTHEAST ASIA'S GENERATIONAL SHIFT: FOREIGN POLICY FUTURES. 8/18, 9:00-10:35am (EDT), HYBRID. Sponsor: National Bureau of Asian Research (NBR). Speakers include: Dante Schulz, Project Manager for Political and Security Affairs, NBR; Rohan Mukherjee, Assistant Professor of International Relations, London School of Economics and Political Science; Rajni Gamage, Research Fellow, Institute of South Asian Studies, National University of Singapore; Md. Tanvir Habib, Assistant Professor, Department of International Relations, University of Dhaka; Moderator: Christopher Clary, Associate Professor of Political Science, University at Albany.

THE STRAIT OF HORMUZ CLOSURE: WHAT HAPPENS TO TRADE AND SHIPPING? 8/19, 9:00-10:00am (EDT), VIRTUAL. Sponsor: Peterson Institute for International Economics (PIIE). Speakers: Simon J. Evenett, Professor of Geopolitics and Strategy, IMD Business School, Founder of St Gallen Endowment for Prosperity through Trade, University of St Gallen Switzerland; Dorota Lost-Siemińska, Director Legal Affairs and External Relations, International Maritime Organization (IMO); Moderator: Cecilia Malmström , Nonresident Senior Fellow, Peterson Institute for International
Economics (PIIE).

GOLDEN DOME: EARLY ASSESSMENT AND OPEN QUESTIONS. 8/19, 10:00-11:00am (EDT), HYBRID. Sponsor: Brookings. Speakers: David Mosher, Director of National Security Analysis - Congressional Budget Office; Steve Fetter, Professor, School of Public Policy - University of Maryland; Michael E. O’Hanlon, Director of Research - Foreign Policy, Director - Strobe Talbott Center for Security, Strategy, and Technology, Co-Director - Africa Security Initiative, Moderator: Melanie W. Sisson, Senior Fellow - Foreign Policy, Strobe Talbott Center for Security, Strategy, and Technology.

PRESS CONFERENCE: JAPAN'S SECURITY IN AN UNCERTAIN WORLD. 8/19, 11:00-Noon (JST), 8/18, 10:00-11:00pm (EDT), HYBRID. Sponsor: Foreign Correspondents' Club of Japan (FCCJ). Speakers: Ken Jimbo, Research Institute for Advanced Innovation and GeoStrategy (RAIS); Tomoyuki Furutani, (RAIS).

DIGITAL TAIWAN LECTURE SERIES – TAIWAN’S ELECTORAL SYSTEM AND THE 2026 LOCAL ELECTIONS. 8/19, 4:00-5:00pm (TST), 4:00-5:00am (EDT), VIRTUAL. Sponsor: Institute for Security & Development Policy. Speakers: Dr. Ching-Hsin Yu, Research Fellow, Election Study Center, National Chengchi University; Moderator: Yi-Chieh Chen, Research Fellow, ISDP’s Stockholm Taiwan Center.

CAN THE UNITED STATES RETAIN ITS SCIENTIFIC TALENT? 8/20, 3:00-4:00pm (EDT), VIRTUAL. Sponsor: Information Technology and Innovation Foundation (ITIF). Speakers: Adriana Bankston, Consultant & Advisor; Scientific Research Policy; Advocacy & Government Relations; Donna Ginthe, Roy A. Roberts & Regents Distinguished Professor of Economics Director, Institute for Policy & Social Research, University of Kansas; Shalin Jyotishi, Founder and Director, Future of Work and Innovation Economy Initiative; Moderator: Trelysa Long, Policy Analyst, ITIF.

DOES AUKUS STRENGTHEN AUSTRALIA’S SECURITY? 8/20 6:00-7:15pm (AEST), 4:00-5:15am (EDT), HYBRID. Sponsor: Lowy Institute. Speakers: Sam Roggeveen, Program Director Lowy Institute’s International Security Program; Jennifer Parker, Nonresident Fellow at the Lowy Institute, Adjunct Fellow in Naval Studies at the University of Western Australia; Mihai Sora, Director of Research at the Lowy Institute. Fee 

North Korea Sending More Soldiers for Russia-Ukraine War

North Korea Doubles Down on Its Alliance With Russia, For Now

By Daniel Sneider, lecturer in East Asian studies at Stanford University, non-resident distinguished fellow at the Korea Economic Institute of America, and APP Member. 

First Published August 12, 2026 on the blog of the Korea Economic Institute of America.

North Korean leader Kim Jong Un has doubled down on his military and strategic alliance with Vladimir Putin and the Russian regime, betting that this axis will strengthen his own position for now. However, Kim’s strategic calculus depends on the outcome of the war in Ukraine and its economic and political impact on Russia. 

The flow of arms and soldiers from North Korea to Russia’s war in Ukraine continues to escalate, accompanied by a growing supply of North Korean labor to fill the gaps in Russia’s war-strained economy. And the North Korean economy is increasing its reliance on a largely unofficial transfer of Russian resources—food, energy, cash and military technology—offered as compensation for its support.

The latest sign of this deepening relationship came from Ukrainian President Volodymyr Zelenskyy, who revealed in a late July address that Russia planned to bring in an additional 30,000 troops and deadly ballistic missile launchers.

“Russia wants to receive another 30,000 troops from North Korea. Since June, preparations have been under way in Russia’s Voronezh region to receive them,” Zelenskyy said, though he did not reveal the source for this information, and it has not yet been independently confirmed.

A North Korean missile unit has begun deploying to western Russia and could be equipped with up to 120 ballistic missiles and six launchers for attacks on Ukraine, an official at Ukraine’s military intelligence agency said on August 6.

The unit comprises about ninety North Korean personnel and is expected to be based in Russia’s Voronezh region, the official said. The United States is aware of the North Korean deployment, a source familiar with the issue told Reuters.

Forty North Korean missiles have already been supplied, at least two of which were launched at Ukraine last week during a deadly strike, the Ukrainian official said.

“This is a threat not only to Ukraine,” Zelenskyy said in his radio address. “Russia is helping North Korea learn how to wage war, improve its weapons and gain real combat experience in using them.” 

The Changing Nature of War in Ukraine and North Korea’s Role

There is some skepticism about these reports, as they have not been confirmed by other intelligence agencies. They also reflect Ukraine’s interest in pushing for more military support to counter missile strikes that are increasingly penetrating Ukrainian defenses, including calling on South Korea to lift restrictions on the sale of missile defense equipment directly to Ukraine.

“In my view, the Republic of Korea should have closer cooperation with Ukraine. We are open to this. We would very much like to receive support from South Korea in an area where we have a shortage. That is air defense systems,” Zelenskyy said in an interview with Ukrainian media posted to X on August 8. 

But analysts point out that these possible new deployments are consistent with the changing nature of warfare in Ukraine. When North Korea’s military assistance began more than two years ago, it first consisted of a huge flow of artillery shells and artillery guns, providing crucial help when Russian stocks were depleted by intense exchanges of artillery fire. It was followed by the deployment of 12,000–16,000 North Korean troops to help push back Ukraine’s incursion into the Russian territory of Kursk, carefully avoiding conflict within Ukrainian territory itself.

Now drones have partially replaced heavy artillery, with static lines of engagement on the ground and heavy casualties, combined with long-range deep attacks using missiles. 

“Russia and Ukraine are currently engaged in two battles,” explains Aihiro Makino, a security expert for Japan’s Asahi Shimbun. “Trench warfare on the front lines centered on the Donbas region, and long-range attacks targeting each other’s deep territories.”

North Korea has a role to play in both battles, says Makino, a long-time specialist on the Korean Peninsula. North Korean missiles are joining attacks on Ukrainian cities, and North Korea can send troops to the Donbas region, as it recognizes  Donbas as Russian territory (despite being seized from Ukraine)—although such a move would risk high casualties.

There are political risks for Kim if casualty levels reach tens of thousands. But he has already decided to embrace the several thousand deaths from the earlier deployment as a heroic mission. In April, the regime opened a lavish “Memorial Museum of Combat Feats for Overseas Military Operations,” which includes war trophies such as U.S. and German tanks and the graves of some 2,288 North Korean soldiers who fought in Kursk.

“Kim’s regime does not care about human lives,” says Fyodor Tertitskiy, a North Korea expert and author of Pyongyang on the Brink, now teaching at South Korea’s Ewha Womans University. “It does, however, care about its own survival, and it has calculated that Putin’s favor outweighs the risks,” he told this writer.

One added element to North Korea-Russia ties is the rapidly growing dispatch of North Korean workers, in the tens of thousands, many of them filling serious labor shortages in factories and other roles across Russia.

“Demand for North Korean labor remains high and is likely to stay high for the foreseeable future,” widely respected expert Andrei Lankov, who teaches at South Korea’s Kookmin University, told this writer. “North Korean workers are already widely employed in the civilian economy, where labor shortages are severe. They can also be used in areas close to the front line and employed in certain military industries.”

Kim’s Strategic Calculus

“The strategic calculus remains the same,” says Tertitskiy. “Putin wants to conquer Ukraine and welcomes Kim’s help, while Kim wants economic assistance and a counterbalance to China.”

Kim has so far managed to intensify his relationship with Moscow while also keeping close ties to North Korea’s traditional ally, China. High-level visits from senior Chinese officials have cemented their ongoing role in North Korea’s economy.

Measured by official trade statistics, China remains the overwhelming dominant player in North Korea’s foreign trade. China accounts for over 98 percent of North Korea’s foreign trade.

But official statistics do not calculate the huge, and in some cases larger, volume of unofficial trade, mostly to evade UN sanctions. Official data for Russia shows a tiny amount of trade—some USD 35 million in 2023, for example. But a recent report from South Korea’s Institute for National Security Strategy calculated that North Korea earned up to USD 14.4 billion from Russia from August 2023 to the end of 2025, mostly from payments for its arms and soldier supplies but also other illegal exports of food and fuel.

This does not count transfers of advanced military technology that have been kept secret but may already include air defense systems, satellite technology, drones, and early warning aircraft.

At the moment, Russian input into North Korea’s modest economic boom of late has been crucial. But in the longer run, argues Lankov, the two economies are not compatible. On the other hand, he says, “China needs many of the goods that North Korea is capable of exporting and therefore has a natural economic interest in buying North Korean minerals, seafood, and other products. In addition, China’s strategic interests require a stable North Korea. Beijing has a strong interest in preserving the status quo and maintaining a buffer zone along its border. For Russia, by contrast, North Korea’s strategic value is considerably lower.”

Implications of the Ukraine War

Kim’s investment in the alliance with Moscow is clearly a successful bet for now. But what happens if the war goes badly and the Russians are forced into a de facto political defeat in the form of a settlement that favors Ukraine? Or a prolonged stalemate that weakens Russia both politically and economically?

Even then, North Korea watchers all agree that the Kim regime is likely to survive that turn of events.

At this moment, the regime has not told the North Korean public that the war has reached a stalemate, says Makino. “Even if Russia is defeated, the public will be told that ‘Russia has won.’ North Korea’s rule is that ‘the Supreme Leader does not make wrong decisions.’”

Lankov shares that view. “North Korea is not tied to Putin’s Russia, and it never will be,” Lankov told this writer. “It is now in the ideal position of having two sponsors. North Korea, while living on a stable but modest Chinese pension, has won the Russian lottery. If the lottery money runs out, it will be bad, but hardly the end of the world, since the Chinese pension is here to stay.”But For the time being, the North Korea-Russia partnership remains strong and beneficial for both parties and likely to weather the changing nature of the war in Ukraine.