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TOKYO: Yoshihide Suga of Japan was elected prime minister by the lower house of parliament on Wednesday (September 16), becoming the country’s first new leader in nearly eight years, while preparing a “continuity cabinet” that is expected to hold roughly half of the lineup of predecessor Shinzo Abe.
Suga, 71, Abe’s longtime right-hand man, has vowed to follow many of Abe’s programs, including his signature “Abenomics” economic strategy, and to push ahead with structural reforms, including deregulation and simplification. of the bureaucracy.
Abe, Japan’s longest-serving prime minister, resigned due to health problems after nearly eight years in office. Suga served under him in the critical position of Chief Cabinet Secretary.
Suga obtained 314 votes out of 462 cast by members of the lower house of parliament. The chamber takes precedence in choosing a prime minister over the upper house, which was also expected to elect Suga due to the majority of the ruling bloc.
READ: Japan’s Suga Wins Ruling Party Leadership Race to Replace Abe
Suga, who won a race for the leadership of the Liberal Democratic Party (LDP) in power on Monday, faces a plethora of challenges, including addressing COVID-19 as he revives a battered economy and grapples with a rapidly aging society.
With little direct diplomatic experience, Suga must also cope with an increasingly intense confrontation between the United States and China, establish ties with the winner of the November 3 US presidential election, and try to keep Japan’s own relations with Beijing on track. .
READ: Japanese Prime Minister Abe resigns due to deteriorating health
National media said about half of the new cabinet would be people from Abe’s cabinet. There will only be two women and the average age, including Suga, is 60.
Among those expected to retain their positions are key players such as Finance Minister Taro Aso and Foreign Minister Toshimitsu Motegi, along with Olympic Games Minister Seiko Hashimoto and Environment Minister Shinjiro. Koizumi, the youngest of 39 years.
“It’s a ‘Capital C Continuity’ cabinet,” said Jesper Koll, senior advisor to asset manager WisdomTree Investments.
Abe’s younger brother Nobuo Kishi is likely to be appointed to the defense portfolio, while outgoing Defense Minister Taro Kono will take over administrative reform, a position he has previously held.
Yasutoshi Nishimura, Abe’s point man in the COVID-19 response, will remain Minister of the Economy, while Minister of Commerce and Industry Hiroshi Kajiyama, the son of a politician whom Suga admired as his mentor, will also retain his position. the media reported.
NEW SPEAKER, STRUCTURAL REFORM
Katsunobu Kato, Suga’s outgoing health minister and close ally, is expected to become Chief Cabinet Secretary.
“Suga will continue Abe’s economic policies and there will be no short-term shock to the markets,” said Kensuke Niihara, chief investment officer at State Street Global Advisors Japan.
“In the long term, because foreign investor interest in Japanese equities has been low, if it goes ahead with structural reforms and deregulations, that’s an issue investors like and it would be a positive surprise.” Niihara added.
Suga has criticized Japan’s top three mobile operators, NTT Docomo Inc, KDDI Corp, and SoftBank Corp, saying they should return more money to the public and face more competition.
He has also said that Japan may eventually need to increase its 10 percent sales tax to pay for social security, but not for the next decade.
Clues as to whether Suga will go ahead with reforms and how they could come from the roster of government advisory panels, such as the Council on Economic and Fiscal Policy, Koll said.
“Mr. Suga’s ambition to accelerate and revitalize the (reform) process is absolutely clear, but the next layer of staff will be interesting,” he said.
Speculation has grown that Suga could call snap elections for the lower house of parliament to take advantage of any surge in public support, though he has said that managing the pandemic and reviving the economy were his top priorities.
