Japan new PM Shigeru Ishiba faces challenges

TOKYO – Shigeru Ishiba became Japan’s prime minister on Tuesday, following his fifth attempt to head the ruling party, but he faces challenges in establishing a lasting government as he has pledged to call a snap election on Oct 27.
After Friday’s leadership election, former economic security minister Sanae Takaichi, a conservative lawmaker who finished second in the runoff, indicated she would not cooperate with Ishiba, complicating his efforts to foster unity within the Liberal Democratic Party (LDP).
While Ishiba has emphasised the need to seek a public mandate for his administration as soon as possible, he will have to compete against former Prime Minister Yoshihiko Noda, the head of the main opposition party, who is an eloquent and experienced lawmaker.
The LDP, which has held power almost continuously since 1955, has come under intense scrutiny after some of its factions failed to report portions of income from fundraising events and amassed slush funds.
Moreover, Ishiba was seen as ineffective in formulating economic growth strategies during the leadership race campaign, likely contributing to stock price declines ahead of the House of Representatives election and weakening the LDP’s popularity.
“Concerns are already starting to emerge among LDP members that the ruling party might not be able to win the lower house election under president Ishiba,” said a lawmaker who backed Takaichi in the leadership race.
Even before the presidential election, Ishiba struggled to gain support from LDP lawmakers, with some criticising him for lacking enthusiasm in building alliances within the party despite media polls showing he was one of the public’s top choices for prime minister.
The 67-year-old former banker and lower house lawmaker, known for his expertise in defence and security affairs, once left the LDP in 1993 after declaring the need for political reform. While he rejoined in 1997, some party members have resented his defection.
The election of Ishiba as the new president “seems to have been the result of passive support,” as many lawmakers “appeared to have judged him as being preferable due to his long political career,” said Tadashi Masuda, a professor at Takasaki City University of Economics.
Shortly after losing to the late Prime Minister Shinzo Abe in the runoff of the 2012 leadership race, Ishiba was appointed LDP secretary general. The move apparently helped maintain party unity, paving the way for Abe to become Japan’s longest-serving premier.
However, Ishiba has been unable to win over Takaichi, who garnered the most votes in the first round of the presidential race, raising doubts about his ability to unite the party ahead of the upcoming lower house election, political analysts said.
“The base of support for Ishiba within the party is even weaker than that of former Prime Minister Fumio Kishida, whose position had been fragile,” Masuda, a political expert, said. “Ishiba is set to have a hard time running the government.”
Noda, meanwhile, said after the LDP election, “I look forward to seeing who can push the other out of the ring first by gripping each other by the belts,” using a sumo wrestling metaphor to describe his expectations for their debate.
While the predecessor of the Constitutional Democratic Party of Japan was in power, Noda served as prime minister for more than one year until December 2012, when the LDP, then led by Abe, scored an overwhelming victory in the lower house election.
In 2022, Noda delivered a memorial speech in parliament for Abe, who was assassinated during an election campaign event in July of that year. Noda’s address contained previously unknown interactions between himself and Abe, drawing considerable attention.
As Noda, who was elected CDPJ leader on Sept 23, is a “stable leader,” the conservative LDP “may be thinking he will become a formidable opponent,” political commentator Atsuo Ito said. Noda has pushed to shift the opposition party toward the centre.
The worst-case scenario for Ishiba is that financial markets will remain volatile before the lower house election. On Monday, the 225-issue Nikkei Stock Average plummeted nearly 5%, reflecting disappointment with his economic policies.
“At present, the overall picture of Ishiba’s economic policies is not clear,” said Yuichi Kodama, chief economist at the Meiji Yasuda Research Institute, adding, “Political factors might continue to cause ups and downs for the time being” in share markets.
All eyes are on whether Ishiba’s government will adopt a strict fiscal austerity policy, said Takuji Aida, chief economist at Credit Agricole Securities Tokyo. Japan’s fiscal health is the worst among major advanced economies.
If measures to achieve this goal are implemented, the broader economy could contract, as fiscal constraints and tax hikes may suppress consumer spending and business investment, potentially eroding support for the Ishiba administration.
In that case, the LDP “might split, and Ishiba’s government would be short-lived,” Aida added.