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The war isn't over...
With Panay's regime out of the way, Santosi, Iriwan, and Razman are going to fight amongst themselves for control of Panau.

The Oil Wars happened because Rico nuked the Panau oil fields
Derp de derp, hurr de hurr.

The Japanese EMP installation is recent
EMP technology was still a wild dream during World War II and a whole unit of 100-years old soldiers (using modern vehicles and weapons, mind you) seems wildly improbable. Then when you read Washio's intel, you discover than Japan is less than cool with China's rise of power and fear that, if a war occurs, they will be wiped out before NATO and the others react. They have been re-arming themselves and Washio is sent on Panau to both secure the oil field for Japan (giving them an edge over the Chinese) and taking over Panau (or at least, annexing the large Japanese minority) once the Ular Boys will be in charge. The EMP installation is here as a line of defense against the Chinese and the first step of transforming Panau in a huge Japanese stronghold/gas pump.
  • Well all of this certainly makes a lot of sense based on the real world political scheme of things in East Asia but I doubt the writers put that much thought into that island. It was obviously just put there to be one big Lost reference and the EMP was just there to simulate the plane crash that happened in that TV show. The only thing that even makes this remotely possible is the fact that these old Japanese soldiers who logically would be in their 80s and 90s by the time the game is set (World War II started 75 years ago when Japan invaded China in 1937 and ended 67 years ago in 1945) look about the same age as all of the Panauian Military you fight in the rest of the game and that they use modern Military equipment. The stuff about old Japanese soldiers fighting World War II that many decades later (in real life the latest any Japanese soldier was still fighting the war was in the 1970s who had the Emperor of Japan issue an official order for them to stop since the war was already over) was probably an urban legend to scare people away from the island.
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  • Their uniforms and vehicles have camo patterns AND bear the modern Japanese flag (which has changed after World War II; you'd expect the modern JSDF to use those, not old farts. But yes, maybe the developers didn't expect us to delve too much in it.

Rico is going to recruit the leaders of the 3 Gangs he helped in Just Cause 2 to be the leaders of Panau
In the ending of the game Tom Sheldon remarks that a U.S Friendly President will replace Baby and that they will watch over this gem of an Island in South East Asia for the foreseeable future. America has had a history of recruiting shady leaders to become leaders of countries they were interested in, Japan, Korea, and Vietnam can all attest to this fact, so this wouldn't be out of character for them. Besides these Gangs were nice enough to help Rico during his mission so the Agency might feel generous enough to reward them, and to not get into any sort of territory brawls and avoid unnecessary bloodshed with Gangs that already have a large deal of influence in Panau anyway.
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