Japan should improve its defence capability in the south-west where it shares a maritime border with China, Japan's vice-defence minister Jun Azumi said.
The country has traditionally allocated its heavy defence capability to the north to respond to potential threats from the former Soviet Union.
"Our attention was on the north but we have to shift our focus to the defence of south-west. The most important step to strengthen our defence over the next ten years is to secure the mobility of our troops," Azumi said.
"We would like to boost our defence capability on land, on the sea and in the sky if budget allows, but added that such policies were not possible due to fiscal constraints," he added.
The country is updating its National Defence Programme Guideline for release by the end of this year.
China's defence spending has nearly quadrupled over the past decade, while Japan's spending has shrunk by 4%, according to Reuters.