TOKYO, JAPAN—Japan’s ruling Liberal Democratic Party (LDP) elected hardline conservative Sanae Takaichi as its new head on Saturday, putting her on course to become the nation’s first female prime minister. The move is expected to inject significant uncertainty into both financial markets and regional diplomacy.
The LDP, which has dominated post-war Japanese politics, selected Takaichi, 64, amid a crisis of confidence. The public, frustrated by rising prices, has increasingly been drawn to opposition groups promising stimulus and stricter controls on immigration. With the ruling coalition holding a majority in parliament, Takaichi is the clear favourite to win the prime ministerial vote scheduled for October 15, replacing the outgoing Shigeru Ishiba.
Taking the Helm of a Party in Crisis
Takaichi, the only woman among the five LDP candidates, defeated a challenge from the more moderate Shinjiro Koizumi, 44, who had sought to become Japan’s youngest modern leader. A former economic security and internal affairs minister, Takaichi inherits a party reeling from losing its majorities in both houses of parliament over the past year.
Speaking after her victory, Takaichi acknowledged the existential challenge: “Recently, I have heard harsh voices from across the country saying we don’t know what the LDP stands for anymore. That sense of urgency drove me. I wanted to turn people’s anxieties about their daily lives and the future into hope.”
Modeling herself on Margaret Thatcher, Britain’s first female prime minister, Takaichi presents a potentially more disruptive and staunchly conservative vision than her rivals.
Economic Disruption and Nationalistic Stance
Takaichi is a staunch advocate of late premier Shinzo Abe’s “Abenomics,” favouring aggressive fiscal spending and an easy monetary policy to boost the world’s fourth-largest economy. She has been openly critical of the Bank of Japan’s (BOJ) recent interest rate increases. Such an expansionary fiscal shift could inject confusion into markets grappling with one of the world’s biggest debt burdens.
Naoya Hasegawa, chief bond strategist at Okasan Securities, suggested Takaichi’s election had immediately weakened the probability of the BOJ raising rates this month, an event markets had priced at around a 60 per cent chance before the vote.
On the foreign policy front, Takaichi’s nationalistic positions are likely to rile neighbours, particularly South Korea and China. She is known for her regular visits to the Yasukuni Shrine, which many Asian nations view as a symbol of Japan’s past militarism. She also advocates revising Japan’s pacifist post-war constitution and has suggested forming a “quasi-security alliance” with Taiwan, the democratically governed island claimed by Beijing.
Taiwan President Lai Ching-te welcomed her election, calling her a “steadfast friend of Taiwan.” Takaichi, if elected Prime Minister, vowed a rigorous international travel schedule to spread the message that “Japan is Back!” and committed herself entirely, stating, “I have thrown away my own work-life balance, and I will work, work, work.”
Warnings for Foreigners
Domestically, Takaichi appears determined to blunt the rise of anti-globalist parties like Sanseito. She tapped into public anxieties by promising to clamp down on rule-breaking visitors and immigrants, who have arrived in Japan in record numbers. She began her first official campaign speech with a pointed anecdote about tourists allegedly kicking sacred deer in her hometown of Nara.
The Sanseito party, while challenging the LDP, welcomed her victory, stating they hoped she would “steer Japanese politics in an ‘anti-globalism’ direction to protect national interests.” While some supporters view her selection as a watershed moment in Japan’s male-dominated politics, opinion polls suggest her socially conservative agenda is currently more popular among men than women.
