The reason why they started with such armament was that the standard fighter armament for most nations from the end of WW1 until the mid-30s was two rifle-calibre MGs (7.6-7.9mm) in the cowling, synchronised to fire through the prop. The reason for that layout was that guns and ammo weren't very reliable for much of this time, so the guns needed to be within reach of the pilot for unjamming purposes.
When they decided to up the firepower, the IJN (like the Luftwaffe) selected the Oerlikon 20mm cannon. The problem was that, even if there had been space for them in the cowling, the cannon was not suited to synchronisation so had to go in the wings.
They would have kept the cowling guns because the cannon had only a limited ammo supply, whereas the MGs had enough to keep firing for several times longer.
Tony Williams: Military gun and ammunition
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