Japan and Vietnam agreed to boost their defence and economic cooperation yesterday, including through the export of military equipment, with Japanese Prime Minister Yoshihide Suga in Hanoi on his first foreign trip since taking office last month.
His priority was to cement the backing of the 10-member Asean, which is chaired by Vietnam this year, for the Free and Open Indo-Pacific vision amid China's assertiveness.
While critics have said the initiative lacks substance, Japan and its counterparts have sought to add more teeth to the vision, including through such means as the Quad group, comprising Japan, the United States, India and Australia, which China has criticised as "stoking a new Cold War".
"It is a big step for the security of our two countries to reach a substantive agreement on the transfer of defence technology and equipment," Mr Suga said after meeting his Vietnamese counterpart Nguyen Xuan Phuc.
The two leaders stressed the need to maintain peace, security, freedom of navigation and overflight in the South China Sea, as well as the principle of peaceful dispute settlement.
Mr Phuc welcomed Japan's "active role in contributing to the regional and global peace and stability", in response to Mr Suga's promise that his country will continue to contribute to regional peace and prosperity.
In Tokyo, Defence Minister Nobuo Kishi met his Australian counterpart Linda Reynolds.
Mr Kishi said Japan will work towards allowing the protection of Australian military assets even in non-combat situations.
He added that the US, Japan and Australia are planning a joint military drill near the South China Sea.
In Hanoi, in a speech at the Vietnam Japan University, Mr Suga denounced actions that have contributed to a recent rise in tensions as "against the rule of law".
Without directly pinpointing China, he said in veiled allusion: "It is important that all the nations involved work towards a peaceful resolution of conflicts in the South China Sea - without resorting to force or coercion."
Mr Suga and Mr Phuc agreed in principle to a deal that allows Japan to supply defence equipment and technology - including patrol planes and radar - to Vietnam to help it improve its surveillance capabilities. Vietnam is among the territories disputing China's blanket claim of the South China Sea.
Japan, which ended a ban on overseas arms sales in 2014, is also in talks with Indonesia and Thailand on similar defence transfer deals, having signed such pacts with Malaysia and the Philippines.
Japan also wants its companies to diversify their supply chain from China. Vietnam is a choice destination to set up factories for half of the 30 companies to be granted subsidies in a 23.5 billion yen (S$302.5 million) scheme to encourage firms to diversify their plants.
Mr Suga said: "The new coronavirus has made it even clearer that to maintain international supply chains, it is important to lower the risk of disruption and to create sustainable supply systems."
Mr Phuc said he was ready to support Japanese investment in Vietnam in such areas as real estate and human resources. Mr Suga, in turn, promised to support Vietnamese foreign workers who have been affected by Covid-19.
They also witnessed the signing of agreements for Japan's Marubeni Corp to invest US$1.3 billion (S$1.76 billion) in a power plant, and another for Tokyo Gas and PetroVietnam Power Corp to jointly build a US$1.9 billion gas-fired plant.
They also agreed on a "business track" arrangement that exempts business visitors from quarantine regulations, and to resume flights between the two nations.
Mr Suga leaves for Indonesia today.