Japan and the United States are planning to develop interceptors to shoot down hypersonic missiles by the 2030s under a contract signed by the two countries on Wednesday.
The plan, which will reportedly cost more than $3 billion, was first announced in August when the leaders of the two countries met in Camp David outside Washington.
"In recent years, around Japan, missile-related technologies such as hypersonic weapons have improved dramatically," the Defense Ministry said in a statement about the agreement to jointly develop the so-called Glide Phase Interceptor (GPI).
"Strengthening interception capabilities against them is an urgent issue."
The Japanese government has already included ¥75 billion ($480 million) in its 2024 budget for development of the interceptors.
Hypersonic missiles fly at more than five times the speed of sound and have irregular trajectories, making them difficult to intercept.
The ¥75 billion is part of a record defense budget of ¥7.95 trillion approved last year, as tensions rise with China and North Korea.
Prime Minister Fumio Kishida has pledged to double defense spending to the NATO standard of 2% of GDP by 2027.
Japan has a pacifist post-war constitution, which limits its military capacity to ostensibly defensive measures.
However, it updated key security and defense policies in 2022, explicitly outlining the challenge posed by China.