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Japan’s Kishida Defies Forecasts, Keeps Majority in Election

Fumio Kishida places a red paper rose on a LDP candidate's name to indicate an election victory on Oct. 31.
By Bloomberg
01 Nov 2021 0

(Bloomberg) --Japanese Prime Minister Fumio Kishida firmed up his month-old government with an election that saw his Liberal Democratic Party avoid the worst-case scenarios that opinion polls had suggested beforehand.

By Isabel Reynolds
Oct 31, 2021, 1:03 PM – Updated on Nov 1, 2021, 3:25 AM
Word Count: 741

The LDP won 261 seats to preserve its outright majority in the 465-seat lower house, public broadcaster NHK said early Monday, dropping from the 276 seats it held when parliament was dissolved. Stocks gained on the outcome, with the benchmark Topix rising as much as 1.8% and the blue-chip Nikkei 225 Stock Average climbing 2.6%. The yen weakened 0.1% as of 9:55 a.m. in Tokyo.

Japan’s General Election As Ruling LDP Set To Win With A Reduced Majority
Fumio Kishida places a red paper rose on a LDP candidate’s name to indicate an election victory on Oct. 31.
Projections published by Yomiuri and Nikkei on Friday had shown that Kishida, who took over from unpopular former Prime Minister Yoshihide Suga, might struggle to maintain his rule without the help of junior coalition partner Komeito, which now has 32 seats in parliament — gaining three in the vote.

“The LDP won a majority and received confidence in this vote, and for this I am grateful,” Kishida told reporters.

The election nonetheless leaves the LDP with its slimmest majority since Shinzo Abe led the right-leaning party out of the opposition and back into government in 2012. Fewer votes will make it harder for Kishida to push through his plans to raise wages, fight inequality and spend big on economic stimulus and defense when parliament returns later this month.

Election Test
Kishida will face pressure to rebuild the cabinet’s approval rating ahead of an upper house election next year. The former foreign minister has struggled to catch on with the public after LDP insiders selected him over a more popular rival, former virus czar Taro Kono, in a leadership race in September.

Still, the LDP’s longtime alliance with Komeito will give Kishida a significant cushion of support for certain issues. The premier lowered expectations ahead of the vote, saying his goal was to win a majority for the coalition, which would’ve allowed for a power-sharing situation with Komeito.

For more on Japan’s election:
Japan’s Stocks Jump as Ruling Party Secures Election Victory
Japan Stimulus Set to Pass Easily After LDP Retains Majority
Affluent Tokyo Suburb Shows Why Japan’s Opposition Can’t Keep Up
Failure of Trickle-Down Abenomics Is Top Issue for Japan Voters
“I think he’ll be fine,” said Amy Catalinac, an assistant politics professor at New York University who has written about Japan’s electoral system. “As soon as he became prime minister, he defined winning the election as securing that bare majority. He’s set himself up to be fine.”

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In one blow to Kishida, his No. 2 party official — Secretary General Akira Amari — decided to resign his post after losing his seat, NHK reported. Kishida is seeking to avoid a return to the “revolving door” period of 2007-12, when Japan saw six premiers exit. Suga lasted only a year, after Abe’s record-breaking seven-year stint on the job.

The main opposition Constitutional Democratic Party of Japan allied itself with smaller parties to field a unified candidate in many constituencies, but that strategy appeared to have failed. It won 96 seats, dropping from the 109 it held when parliament was dissolved, NHK said.

Japan’s General Election As Ruling LDP Set To Win With A Reduced Majority
Electoral officials count ballots at Himeji Dokkyo University in Himeji.
One of the biggest winners appeared to be Ishin, a conservative-leaning opposition party that hadn’t joined the candidate pact with the CDP. It nearly quadrupled its seat numbers to 41 and became the third-largest party in parliament, NHK said.

The ruling coalition will have to work on bolstering an economy that likely shrank over the summer due to a Covid surge and supply bottlenecks, according to estimates by several economists. Kishida has pledged to draw up measures worth tens of trillions of yen soon after the vote, and told NHK on Sunday night that he wanted to pass an extra budget by the end of the year.

“If his support rate falls and he’s not good at answering questions in parliament, people will think they can’t fight the upper house election with him at the helm and it could be like his predecessor Suga all over again,” said Shigenobu Tamura, a political analyst and former LDP staffer.

(Updates with stock gains in second paragraph.)
–With assistance from Emi Nobuhiro.

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