After the sea level began rising in the beginning of the twenty-first century, Japan lost a significant portion of its territory and in order to ease the control over the country, it was split into three parts: The Northern region with the capital in Sapporo, the Central region with the capital remaining in Tokyo, and the Southern region with the capital in Nagasaki.
Following the Great Battle against the "Fleet of Fog" in 2039, Nagasaki remains as one of the few cities in Japan with a working port. I-401 used this port to resupply at least once following her battle against light cruiser Nagara in Saga prefecture. It is not completely clear, whether there are fortified dry docks like those found in Yokosuka port there, however it was hinted that it is so.
In the anime, one of the Military Command of Ministry of Defense's headquarters is located in Nagasaki.