Kishida’s exit opens the door to a chaotic era in Japan

By Gearoid Reidy

In the end, Fumio Kishida could not escape the pull of gravity.

Japan’s ruling Liberal Democratic Party will elect its new leader late next month, and in recent weeks, the momentum in Tokyo had been swinging one way: That the unpopular but famously stubborn Kishida would run, and win, as potential successors demurred and bided their time for a better opportunity.

That momentum suddenly ran out Wednesday when, in the midst of the normally lazy Obon holiday season, the prime minister announced he wouldn’t seek another term as LDP head, effectively tendering his resignation and throwing the race for Japan’s next leader into chaos.

Parallels are there to be drawn with Joe Biden, the US president with whom he deepened the bilateral alliance. While the millstones around Kishida’s neck are different — his age is not the issue; the controversy is centred on the LDP’s funding scandal and ties to the Unification Church — the upshot is the same. Despite their long list of policy achievements, both leaders struggled to reconnect with the public as they once had, and members further down the ticket began to eye the possibility of a national election, asking how much longer the situation could continue like this.

Like Biden before him, Kishida bowed to polling reality. Yet unlike the US president’s swift endorsement of Kamala Harris, there is as yet no heir-apparent in Japan. “We must show a new and changed LDP to the people,” Kishida told reporters on Wednesday. “To do that, we need a transparent, open election and above all, a free and open debate.” Lawmakers and party members will make their choice next month, and with no general election required until October 2025, their selection will determine the country’s next leader.

It sets the stage for the most interesting leadership vote in the country since the late Shinzo Abe made his shocking return 12 years ago, at a time when the LDP was still in opposition. During Abe’s years in power, he faced little real competition, and when he stepped down due to ill-health in 2020, the party quickly
rallied around his right-hand man, Yoshihide Suga. Kishida was a logical choice the following year when Suga declined to seek a new mandate.

This time, all bets are off — at least right now. The potential for a left-of-field candidate, perhaps perennial maverick challengers Taro Kono or Shigeru Ishiba, who both have held senior ministerial portfolios, has rarely been higher. Shinjiro Koizumi, the son of the famed rebel Junichiro, might decide his time to run has come at last. Takayuki Kobayashi, a former economic security minister, keeps popping up in media reports. Support from the party’s senior leaders, former prime ministers Taro Aso, Suga, and the incumbent himself, will be crucial. But with most of the LDP’s factions disbanded in the aftermath of the funding scandal, it’s hard to know how lawmakers might vote. Up against a weak opposition, the LDP almost always wins national elections.

Whoever succeeds him, Kishida will leave a mixed legacy of both accomplishments and baggage. The premier’s record on defence and foreign policy speaks for itself; it’s no coincidence that US Ambassador Rahm Emanuel, Japan’s biggest cheerleader, was among the first to issue praise. He hailed the “new era of relations” ushered in over the past three years, and has spoken of how the premier could do what his predecessor Abe could not: double defence spending, relax defence export rules, and restore ties with South Korea, all without sparking mass protests.

With China doves within the LDP a dying breed these days, any successor seems unlikely to rock the boat too much here — though the likes of Sanae Takaichi, currently economic security minister, might move things further right. But it’s at home where things need most attention. Kishida’s “New Capitalism” economic policy was a busted flush, spooking markets and earning him the derisive (and undeserved) nickname of “Tax-Hike Four Eyes.” His replacement will need a better focus on the domestic economy. 

And he leaves with his promise of salary hikes above inflation only beginning to have impact, with real wages finally rising in June for the first time in 27 months. He should have taken a victory lap on defeating deflation; instead, the public still frets about inflation and the weak yen. His replacement will have to deal with any further market ructions caused by the rate hikes of Kishida’s pick to lead the Bank of Japan, Kazuo Ueda. With over a month to go, it’s entirely possible that rather than air dirty laundry in public, the party will coalesce around a mainstream candidate: Foreign Minister Yoko Kamikawa, perhaps, or policy heavyweight Toshimitsu Motegi. 

But potential challengers should take a tip from Kishida, known to be a voracious reader.