The BGA Japan team, led by Managing Director Kiyoaki Aburaki, wrote an update to clients on the election of Shigeru Ishiba.

Context

  • Shigeru Ishiba, a member of the House of Representatives, was elected as the new president of the ruling Liberal Democratic Party (LDP) in the party’s leadership election September 27. He will officially become Japan’s next prime minister during the Diet session convening October 1. Ishiba may dissolve the House of Representatives as early as the second week of October, potentially leading to a general election October 27.
  • For years, Ishiba has consistently been one of the most favored candidates for prime minister in public opinion polls. Known as an expert in defense and national security, he commands a strong presence within the LDP. In the recent leadership race, he proposed establishing an “Asian NATO.” In August, Ishiba visited Taiwan as part of a bipartisan delegation and held discussions with President Lai Ching-te on key issues, including the Taiwan Strait. He is also recognized for his proactive engagement with the defense industry during his time as minister of defense.

Significance

  • A record nine candidates ran for the position. In the first round of voting, which involved 367 votes from Diet members and 368 from general party members, Shigeru Ishiba secured 154 votes, coming in second behind member of Parliament and Minister of State for Economic Security Sanae Takaichi, who garnered 181 votes. Although Ishiba matched Takaichi in votes from general members, he received only 46 Diet member votes compared to Takaichi’s 72, putting him behind. However, Ishiba turned the tables in the runoff. Although party support had been a political weakness for Ishiba, he managed to secure 189 Diet member votes in the second round, surpassing Takaichi’s 173 votes.
  • Elections immediately following the appointment of a new prime minister tend to favor the ruling party. If Ishiba decides to call a general election at the end of October, the odds of the LDP’s victory are high. Meanwhile, Yoshihiko Noda, the leader of the main opposition Constitutional Democratic Party, announced September 23 that his party would coordinate candidates among opposition parties for single-member districts to face off against the LDP in the upcoming election. However, if Ishiba dissolves the Diet early, the opposition parties may not have time to adjust their candidates, further tilting the odds in favor of the LDP.

Implications

  • For businesses, actively engaging with the Ishiba administration as it seeks to deliver results on key policy initiatives presents a valuable opportunity to enhance their presence in the Japanese market. Ishiba emphasizes that a strong economy is the foundation of fiscal health, stressing the importance of achieving economic growth first.
  • In the leadership race, Ishiba pledged to focus on strengthening domestic supply chains for semiconductors and artificial intelligence, developing digital infrastructure, promoting digital transformation in health care and utilizing renewable energy, including nuclear power. All of these are key priorities for the Japanese government. A victory in the upcoming general election would be seen as both a mandate for the new Ishiba administration and public endorsement of the LDP’s priority policies, such as digital transformation and carbon neutrality, which would further solidify the new Cabinet’s political power.

We 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.

Best regards,

BGA JapanTeam

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Managing Director

Kiyo understands the Japanese business community inside and out from his three decades working for Japan’s most powerful business organization, Keidanren. He covers international trade and investment, defense and aerospace, information technology, entrepreneurship, deregulation and data privacy policy. He also played a leading role in developing and implementing political strategies for the private sector. Kiyo has led Keidanren’s strategic international initiatives since 2013, and most recently headed up the federation’s international engagement. He worked closely with former Prime Minister Yasuo Fukuda to establish Japan’s Track 1.5 dialogues with the United States and China. The dialogues produced important results by strengthening ... Read More