111. National Intelligence Estimate1

NIE 41–68



Japan is acquiring an increasingly important position in the international economic community; its remarkable economic growth will soon make it the third most productive nation after the US and the USSR. At the same time, Japan is becoming progressively more assertive in world and regional affairs. The constraints on Japan’s willingness to seek international political responsibilities are bound to diminish further over time, nevertheless its acceptance of such responsibilities, and its exercise of influence and power in international affairs generally, will probably not increase to the degree suggested by its powerful economic position within the next 5 to 10 years.2
We believe that Japan will continue to identify its basic interests with those of the US and the Free World over the next 5 to 10 years. In particular, it will probably devote important diplomatic efforts to cementing friendly relationships with its leading trading partners—the US, Canada, and Australia. These economic ties and an increasing similarity of political goals have aroused Japanese interest in the development of an informal grouping of advanced Pacific nations.
Japan will continue to rely primarily on the US for its strategic security. In relations with the US, Okinawa is likely to continue as a troublesome problem, but we foresee no effective opposition in Japan to the continued application of the US-Japan Security Treaty past 1970. During the next five years, Japan will probably not decide to develop nuclear weapons but it will keep the option open. It will also improve its conventional military capabilities, particularly its air and sea defense forces.
Japan will probably avoid direct military involvement in efforts to “contain” communism; in certain circumstances, however, the Japanese might be willing to accept a limited measure of responsibility for the defense of lines of communications in the Northeast Asian area.
Japan sees Communist China as a long-range competitor for influence in East Asia, but the Japanese will continue to avoid unnecessary provocation of Peking while working, mainly through economic means, to limit its influence. In the Japanese view, security in Asia can best be insured by the development in Peking of a less militant and more realistic view of the outside world; Japan will attempt to foster any such tendencies in China, taking care not to impair its own relationship with the US.
Japan will seek to expand its influence in South Korea and Taiwan, and in Southeast Asia, but its interests in the latter region are less compelling. Japan is reluctant to become deeply involved in the region’s political turbulence, considers that security there is primarily the responsibility of the US, and is aware that Southeast Asia trade is not critically important to Japan’s economy. Japan’s most likely course for the next few years will be to continue its present emphasis on economic assistance; its role in the political field will probably grow but it will still move carefully, applying its influence in support of stability and regional cooperation.

[Here follows the discussion section of the estimate and an economic annex.]

  1. Source: Department of State, INR/EAP Files: Lot 90 D 110, National Intelligence Estimates, Special Intelligence Estimates. Secret; Controlled Dissem. According to a note on the cover sheet, the Central Intelligence Agency and the intelligence organizations of the Departments of State and Defense, the Atomic Energy Commission, and the National Security Agency participated in the preparation of this estimate. All members of the USIB concurred with this estimate on January 11 except the Federal Bureau of Investigation, which abstained on the grounds that the subject was outside its jurisdiction.
  2. The Director of Intelligence and Research, Department of State, believes that paragraph A greatly underestimates the probable significance of the political role Japan will play in the next decade. [Footnote in the source text.] Both INR and EA/J believed that the report did not accurately record the emerging regional and global importance of Japan in the coming years and recommended the following footnote be added to paragraph A: “The Director of Intelligence and Research, for the Department of State, believes that the chances are better than even that Japan’s international political importance will catch up to its powerful economic position within the next decade. While it will not attain the super-power status of the US and the USSR, it will be at least as important in world affairs as those countries on its own economic level, Britain, France, and West Germany, and will play a major role in Asia. Its economic importance and heavy dependence on world trade, its geographic location on the rim of the Pacific and on the flank of China and the rest of East Asia, and its increasing awareness that it must take more and more active steps to contain and compete with Communist China will draw Japan into a more dynamic role, to which its leadership already aspires.” (Memorandum from Fred Greene, INR/REA, to Hughes, January 8; ibid.)