TOKYO. Japanese Prime Minister Fumio Kishida has announced that he will step down in September, concluding a three-year term overshadowed by political scandals and paving the way for a new leader to tackle the challenges of rising prices.
“I will continue to do everything I can as prime minister until the end of my term in September,” Kishida stated during a televised press conference on Wednesday. He also confirmed that he would not seek re-election as the Liberal Democratic Party (LDP) leader, signaling the start of a leadership contest that will determine the next prime minister of Japan, the world’s fourth-largest economy.
Kishida’s decision to resign comes after a series of scandals that eroded public support, including the party’s controversial ties to the Unification Church and unrecorded political donations at LDP fundraising events. These revelations significantly impacted his standing within the party and among the public.
Michael Cucek, a professor specializing in Japanese politics at Temple University in Tokyo, commented on the situation, saying, “He’s been a dead man walking for quite some time. There was no way to add up the numbers so that he would get reelected.”
The incoming LDP leader will face a daunting task of unifying a divided ruling party while addressing critical issues such as the rising cost of living, escalating geopolitical tensions with China, and the potential return of Donald Trump as U.S. president in 2025.
Kishida, Japan’s eighth-longest-serving post-war leader, played a pivotal role in leading the country out of the COVID-19 pandemic through extensive stimulus spending. He also appointed Kazuo Ueda as the head of the Bank of Japan (BOJ) to end his predecessor’s aggressive monetary stimulus policies.
In July, the BOJ unexpectedly raised interest rates as inflation surged, leading to stock market instability and a sharp decline in the yen. According to Shoki Omori, chief Japan desk strategist at Mizuho Securities in Tokyo, “Kishida’s departure could mean tighter fiscal and monetary conditions depending on the candidate. In short, risk-assets, particularly equities, will likely be hit the most.”
Breaking from traditional policies, Kishida also shifted focus away from corporate profit-driven trickle-down economics, implementing strategies aimed at boosting household incomes, including wage hikes and promoting share ownership.
As Japan prepares for a new era of leadership, the challenges ahead will test the resilience of the nation’s political and economic frameworks.
Gary P Hernal started college at UP Diliman and received his BA in Economics from San Sebastian College, Manila, and Masters in Information Systems Management from Keller Graduate School of Management of DeVry University in Oak Brook, IL. He has 25 years of copy editing and management experience at Thomson West, a subsidiary of Thomson Reuters.
