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Japan politics: Battle to succeed Koizumi heating up(EIU Viewswire Via Thomson Dialog NewsEdge) COUNTRY BRIEFING FROM THE ECONOMIST INTELLIGENCE UNIT Shinzo Abe remains the favourite to succeed Junichiro Koizumi as president of the ruling Liberal Democratic Party (LDP), and hence Japan's prime minister, in an election on September 20th. Nonetheless, the chief cabinet secretary is not running unopposed: the current finance minister, Sadakazu Tanigaki, and the foreign minister, Taro Aso, have declared their candidacies. Although the election seems a foregone conclusion, debate over the candidates' differing policy platforms suggests a greater degree of conflict within the LDP than the broad support for Mr Abe indicates. Below we analyse the three candidates' policy platforms and their chances in the election, before identifying some of the challenges the winner will face when he takes office. SHINZO ABE Politics and diplomacy: Mr Abe, at 51 the youngest of the three candidates, is also the closest to Mr Koizumi in terms of political philosophy and policy objectives. He staked out his position in the first public appearance of the three candidates, in Yokohama on August 22nd, prioritising constitutional revision and educational reform. Both reflect his nationalist leanings: he is a strong supporter of Japan's right to a conventional army (which the 1946 constitution bars) and of its right to take robust action to ensure its own security, such as collective self-defence. He is also in favour of downplaying the emphasis on wartime guilt in education, favouring instead the inculcation of national pride through promoting use of the national anthem and respect of the flagpolicies that have won him the backing of the LDP's right wing. His hawkish foreign-policy stance has probably won him more support than it has cost him. He has adroitly used public anger against North Korea to boost his popularity, calling for stern measures to be taken after Pyongyang test-launched a series of ballistic missiles in early July. Some will be concerned that under his leadership, Japan's abysmal diplomatic relations with China and South Korea are unlikely to improve. Mr Abe has publicly backed Mr Koizumi's right to visit Yasukuni shrine (and went there himself in April) and has said he will prioritise Japan's strategic relationship with the US while in office, presumably at the expense of improving Japan's standing with its neighbours. Economic policy: Mr Abe has been a vocal supporter of Mr Koizumi's structural reform programme, but unlike Mr Koizumi he has no centrepiece reformsuch as postal privatisationwith which to define his convictions. With regard to solving Japan's most pressing economic problem, its vast public debt (estimated by the OECD to be 170% of GDP, the largest of any industrialised nation), Mr Abe has kept quiet. This reflects the fact that the fiscal policies necessary to reduce the debt, particularly raising taxes, are highly unpopular. Chances: Mr Abe is the overwhelming favourite to win the election because of his broad public popularity. He is relatively youthful, photogenic and has made the most of his close connections to Mr Koizumi. In an opinion poll published by the Nihon Keizai Shimbun on August 21st, 44% of respondents backed Mr Abe to take over the premiership. The election will not be decided by a public vote: only ballots cast by the LDP's 403 legislators, 300 votes spread across its prefectural chapters, and those of its approximately 1m rank-and-file members nationwide (which carry far less weight) will count. But with one eye on future general elections the winning candidate must also be popular with the public. Mr Abe's popularity means his candidacy already has the endorsement of most of the LDP's Diet members. He is a member of the party's largest faction, led by the former prime minister Yoshiro Mori, which has 86 members, while the Tsushima, Niwa-Koga and Ibuki factions (the second-, third- and fifth-largest factions respectively, with 116 members between them) are leaning in his direction, citing the importance of party unity ahead of local and Diet elections next year. Their support means it is increasingly looking like a landslide for Mr Abe. TARO ASO Politics and diplomacy: As foreign minister, Mr Aso has been at the forefront of efforts to defend Japan's interests during diplomatic disputes with China and South Korea, while also driving a (successful) bid to get the international community to take a tough line against North Korea after its missile tests. But somehow he has made less political capital from this than Mr Abepartly because he lacks the charisma or fluency to develop as attractive a public persona. This is the second time he has run for the LDP presidency, having lost out to Mr Koizumi in 2001. Mr Aso's biggest problem is that he has been unable to distinguish himself from Mr Koizumi or Mr Abe. He has said Japan needs to make an "active commitment" to the rest of Asia, although he has not outlined how he thinks its relations with its neighbours can be improved. (He is on record as having described China as a "considerable threat".) With regard to Yasukuni, he shares Mr Abe's view that it should not become a political issue in the leadership campaign, declining to say whether he would visit the shrine if elected prime minister. Economic policy: Mr Aso has expressed sympathy for the rebels who were ejected from the LDP last year for refusing to support Mr Koizumi's postal-privatisation legislation, suggesting that some of them could be let back in (also aiming criticism at Mr Koizumi's divisive political manoeuvring by claiming the next prime minister should shift "from destruction to creation"). This suggests his commitment to structural reform might not be strong: he has also criticised fiscal reconstruction "fundamentalism". His stint as economic and fiscal policy minister in Mr Koizumi's first cabinet means his comments carry some weight, but like Mr Abe he has avoided talking about politically unpopular but fiscally necessary reforms. Instead, he has focused on resolving the widening regional disparities in economic development, presumably to secure the backing of the LDP's core rural supporters. Chances: Mr Aso has all but admitted himself that he has next to no chance of winning the election, saying on August 24th that he was running because "someone had to stand up and fight" and that it would have been bad for the party if Mr Abe had been elected unopposed. He also referred to the 2001 contest, which many thought would be won easily by the former prime minister Ryutaro Hashimoto, before Mr Koizumi came through to win. Mr Aso has little support within the LDP: the Kono group, to which he belongs, has only 11 members and he failed to win the support of the Koga and Yamasaki factions (the only ones that might have been likely to support him, as their leaders, like Mr Aso, hail from Fukuoka prefecture). In the Nikkei's August 21st poll Mr Aso ranked third, getting the support of just 5.5% of respondents. SADAKAZU TANIGAKI Politics and diplomacy: The finance minister has positioned himseld as the "anti-Abe" candidate, after Mr Abe's main rival, the former chief cabinet secretary Yasuo Fukuda, decided not to run in the contest. He has based his campaign around his belief that Japan needs to prioritise the improvement of its diplomatic relations with China and South Korea, which he characterised on August 23rd as "abnormally bad". He is the only one of the three front runners to state that he would not visit Yasukuni if he were elected prime minister. Economic policy: Mr Tanigaki is also the only one to grasp the nettle by saying that he will raise the consumption tax if elected. This is certainly sensible if the next administration is serious about fulfilling the current government's latest budget plan, issued in early July, which seeks to return the primary budget balance (the balance excluding debt servicing) to surplus, from a deficit of 6.2% of GDP last year, by fiscal year 2011/12 (April-March). The plan says spending will have to be cut by 11trn-14trn (US$97bn-123bn) and tax revenue will have to rise by 2trn-5trn in order to meet this target. Chances: Given the unpopularity of raising the consumption tax (something Mr Koizumi pledged would never happen during his tenure) it is all but politically suicidal for Mr Tanigaki to promote it. Even if it is seen as economically sensible, LDP members are not likely to be prepared to risk a public backlash at the polls by electing Mr Tanigaki to the party presidency. (Based on an Abe victory, the Economist Intelligence Unit forecast is for a 2-point increase in the consumption tax to be implemented in 2008-09, after various electoral hurdles have been negotiated). Like Mr Aso, Mr Tanigaki lacks support within the partythe faction he leads has only 15 membersand his public popularity is in single digits. In the latest Nikkei poll, only 6.4% of respondents backed him to succeed Mr Koizumi. After the election Assuming he is elected leader of the LDP, Mr Abe will face a number of challenges in the first few months of his tenure as prime minister. Although the most important of the party's nine factions have decided to support his election campaign, this might reflect their concern about being frozen out of key positions in Mr Abe's first cabinet (as those who opposed Mr Koizumi in 2003 were, after he was safely re-elected LDP president). Once these concessions have been parcelled out, though, divisions within the party over foreign and economic policy might become more pronouncedespecially as Mr Abe lacks the unchallengeable authority that Mr Koizumi built up. He will be able to earn a similar authority if he steers the party successfully through the electoral tests that lie in store. The first of these are local elections due in April 2007. These will provide a taster for the more important election for one-half of the seats in the House of Councillors (the upper house of parliament) in July. The electoral cycle dictates that local and upper house elections coincide only once every 12 years. Precedent suggests, however, that the LDP fares poorly in upper house elections in these years, not least because the party's grassroots are unable to handle two major elections in quick succession. In July 2007 the LDP will also be defending seats won in the upper house election of 2001, when the Koizumi boom was at its height. Notwithstanding Mr Abe's popularity, many of these seats are likely to be lost. If the LDP does not perform well in these polls the chances of Mr Abe following through with controversial economic reformscarrying on where Mr Koizumi left offwill diminish. The media-led backlash against MrKoizumi's reforms, which are seen as having widened the gap between rich and poor, will further militate against the new government taking an aggressive stance on economic reform. Yet the job Mr Koizumi began is only half done. Mr Abe must grapple with the vast challenges of reforming the social-security system and sustaining economic growth as the population ages and shrinks. Even if he is easily elected prime minister, being prime minister will be far from easy. SOURCE: ViewsWire Asia Copyright 2006 Economist Intelligence Unit |