From: the Netherlands
You lose PPs if you don't withdraw them. It "simulates" (historical) redeployment and reassignment of airgroups, ships and ground forces. It might seem odd at times, especially while playing the Japanese, but it is just the way it is.
You'll have to get used to it and plan ahead.. It's not that bad really, just another thing to do :-)
"It happened, therefore it can happen again: this is the core of what we have to say. It can happen, and it can happen everywhere.”
¯ Primo Levi, writer, holocaust survivo