Asia St: What Japan’s Next Prime Minister Means for Business

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What Japan’s Next Prime Minister Means for Business

September 29, 2021

Fumio Kishida (Photo Credit: Kishida’s Twitter Page).

Context

Fumio Kishida won the ruling Liberal Democratic Party (LDP) presidential election on September 29. He will be chosen by the Diet on October 4 to be Japan’s 100th prime minister.

The development marks the latest chapter in a political drama which started with Prime Minister Yoshihide Suga’s announcement in early September that he would step down. The LDP race is being watched as it could lead to a stronger political foundation for the LDP.

Significance

Kishida’s victory can be attributed to the stronger support he enjoys from LDP lawmakers. His chief rival, Taro Kono, received stronger support from rank-and-file party members nationwide.

It also occurred in the face of the LDP’s rising popularity and a high degree of public attention. The surge in Covid-19 delta variant cases ended faster than expected, increasing public approval ratings for the LDP as shown in some recent opinion surveys. During the presidential election, debates among the four candidates received an unusually high degree of public attention.

Implications

Kishida needs to manage the party in an open, inclusive and strategic manner to ensure a general election win. This would help him avoid criticism of the LDP’s closed decision-making and to ensure a win in the general election, likely taking place on November 7 or 14.

Businesses can expect consistent policy priorities extending to key sectors. These include measures to fight Covid-19, an emphasis on digital transformation, carbon neutrality and green growth and the launch of a huge economic stimulus package by the end of 2021.

On foreign policy, companies should anticipate continuity on broad contours. These include strong commitments to U.S.-Japan relations, a free and open Indo-Pacific and the strengthening of Japan’s national economic security.

BGA will continue to keep you updated on developments in Japan as they occur. If you have any comments or questions, please contact BGA Japan Managing Director Kiyoaki Aburaki at kaburaki@bowergroupasia.com.

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