Japanese Politics Updates – September 22, 2024

Thank you for your interest in the weekly politics updates produced and delivered to you by Langley Esquire and Japan Expert Insights:

• Autumn equinox (Shūbun-no-Hi) on Monday represents the official transition into Autumn, a special time-of-the-year in Japan;
• LDP Election on Friday, remember to catch Timothy and Dan Harada’s separate analysis (published on Tuesday 24th) and available retrospectively, deep-diving into the background that you need to hear;
• Next week on Thursday Dan Harada and Timothy will revisit the issue, two-days after the President is voted-in as Prime Minister and he announces his Cabinet;
• The Constitutional Democratic Party ends their campaign tomorrow (Monday 23rd) with results announced on Tuesday;
• The Chinese import ban on Japanese foodstocks is being reconsidered. Russia, in lockstep with the PRC, is likely to follow suit. This amid the tragedy in which a Japanese 10yo schoolboy succumbed on Wednesday to injuries sustained in a brazen knife attack. China – Japan relations are very frothy now as a result;
• North Korea fired a flurry of ballistic missiles, falling outside Japan’s EEZ.

Hyogo Prefectural Governor Faces No Confidence Motion

The Governor of Hyogo Prefecture, Motohiko Saito, has suffered an unanimous no confidence motion from the Prefectural Assembly. The governor was elected with joint support from the Liberal Democratic Party (LDP) and Ishin-no-Kai. This is significant for Ishin-no-Kai because, as they fully supported candidate Saito, they were aiming to expand their influence throughout Osaka and onto the national stage. They achieved some of this, so the no-confidence motion is a heavy hit, particularly amidst the LDP, CDP, Komeito dynamics these days.

The Governor has 10 days to:

• Resign from office; or
• Dissolve the Prefectural Assembly, forcing a re-election of all Members.

Historical Precedent:

A no confidence motion against a Prefectural Governor has occurred 10 times in post-war Japan. In all instances, the Governors chose not to dissolve the Assembly. If Governor Saito dissolves the Assembly, Members will need to be re-elected, and if he wins re-election, to potentially (almost guaranteed to) face another no confidence motion. Messy business.

Challenges and Public Sentiment:

The Governor succeeded a three-term predecessor yet has faced criticism from Prefectural bureaucrats resistant to his policies. Despite the pushback, the Governor appears determined to remain in office, but the unanimous no confidence vote suggests a precarious position. There are 8 days for Saito to decide his course of action.

Chinese Aircraft Carrier Passes through Okinawa Islands

A Chinese aircraft carrier passed through international waters between Japan’s Okinawan islands Yonaguni and Iriomote on Wednesday. The passage occurred in the 35 miles wide strait separating these two southernmost islands, but outside Japan’s 12 nautical mile territorial waters. As a result, technically the passage was legal under international law but perceived as highly-provocative: not only is this the first time a Chinese aircraft carrier has made such a passage, but it follows other recent Chinese military activity in the region. As reported here, for example, a Chinese surveillance aircraft violated Japanese airspace two weeks ago and  this last week, a Russian / Chinese flotilla (over 400 vessels!) carried-out the largest joint naval drills in 3 decades… all within the Sea of Japan! Intense.

Related Diplomatic Context:

As these military activities unfold, Japan’s Prime Minister is attending the Quadrilateral Security Dialogue (Quad) meetings in Philadelphia with Heads-of-State from India, Australia, Japan, and the United States. The backdrop includes broader regional concerns, such as China’s response to the release of Fukushima wastewater and potential lifting of its ban on Japanese food imports.

Strategic Concerns:

While the Chinese government insists the carrier’s passage is legal, many see this as a serious and provocative move. Yonaguni Island, the westernmost island of Japan, is in close proximity to Taiwan and near a critical geopolitical zone in the Indo-Pacific. The incident adds to growing concerns over Chinese military activities in the region and will be a topic of concern during ongoing Quad discussions and other diplomatic efforts.

Komeito Party Elects New Leader Amid LDP Leadership Uncertainty

Komeito, the coalition partner of the Liberal Democratic Party (LDP), is currently holding its convention, which started last week. During the convention, Komeito selects its new leader, Keiichi Ishii, in a non-contested process that follows traditional party procedure. The convention will conclude on Saturday, the day after the LDP’s leadership election. Mr. Ishii will take over as Komeito’s new leader, though the implications of this change for the coalition with the LDP remain unclear.

Coalition Dynamics:

The relationship between Komeito and the LDP has been a key feature of Japanese politics for over 20 years, though some view the partnership as unconventional. With Komeito’s new leadership and the uncertainty surrounding the LDP’s next leader, the future of the coalition is a significant issue. The conclusion of Komeito’s convention may offer further insights into the party’s policies and strategic direction moving forward.

Constitutional Democratic Party Leadership Election

The Constitutional Democratic Party (CDP) is concluding its leadership election, with voting ending on September 23. The new leader will be announced on Tuesday (though we will know on Monday) when the results are formalized.

Candidates: 

There are four contenders for leadership:

• Yoshihiko Noda – former Prime Minister during the period when the LDP was out of power;
• Yukio Edano – Founder of the Constitutional Democratic Party and former Secretary General;
• Kenta Izumi – protégé of Edano, currently serving his second term, seeking a third term;
• Harumi Yoshida – A first-time female candidate in the race, just in her first term in office.

Election Process:

The leadership election follows the familiar two-round system. In the first round, if no candidate secures 50+% of the vote, the top two candidates advance in a runoff. Voting is limited to the 136 CDP Diet Members and the party’s rank-and-file card-carrying members.

Current Standings:

Among the Diet members:

• Yoshihiko Noda leads with 40 endorsements;
  • Yukio Edano is close behind with 30 endorsements;
  • Kenta Izumi and Harumi Yoshida both hold 20 endorsements, making them less likely to survive the first round.

While Noda leads among Diet members, Edano appears to have stronger support among the party’s general membership, making the final outcome uncertain.

Election results will determine how the party positions itself against the ruling LDP. Although Noda currently has the edge among lawmakers, Edano’s popularity with the broader membership could shift the balance. The official announcement of the new leader will be on Tuesday, with potential informal results available as early as Monday.

Bank of Japan Governor Addresses Yen Volatility and Economic Policy

Bank of Japan Governor Kazuo Ueda held a policy meeting on Friday, addressing Japan’s monetary policy and the volatility of the yen. Ueda indicated that Japan will maintain its current economic policy stance, particularly on interest rates. The decision comes amid significant global economic instability and heightened yen-dollar volatility. On Friday, the yen closed at 143.8 yen per dollar, a significant strengthening compared to the previous weeks. During the day, the yen briefly hit 141 per dollar until after the Ueda briefing. 

The yen’s recent strength can be attributed, to some extent, to U.S. economic dynamics, particularly the dollar’s slight decline, revealing again the dollar’s direct impact on the yen-dollar exchange rate. As is often said, when the U.S. economy sneezes, Japan catches a cold, highlighting the strong interdependence between the two economies.

Record Number of Overseas Visitors for August

Japan experienced a significant increase in overseas visitors in August, with nearly 3 million foreign visitors, marking a 36% increase from August of last year. This is also a 16.9% increase compared to the pre-COVID August 2019 level.

Total visitors in August: just under 3 million, marking a slight dip from the last seven months, each of which had 3 million+ visitors. The decrease is attributed to disruptions caused by typhoons and the scorching heat. Total visitors for 2024 (January–August): 24 million, an impressive recovery from COVID-19 travel restrictions.

Top Visitor Sources:

• China led the way with 748,000 visitors in August, doubling its number from the same month last year. This surge is due to the relaxation of travel restrictions for Chinese nationals;
• South Korea followed with 612,000 visitors, with Taiwan, Hong Kong, and the United States rounding out the top five;
• Notably, Italy and Spain saw the highest percentage increase in visitors to Japan, suggesting successful tourism promotion efforts in those countries.

1.44 million Japanese tourists traveled overseas in August, which is 31% below the pre-COVID levels of 2019, but 19% higher than last year. The surge in foreign visitors is having a positive impact on Japan’s economy, as tourism plays a vital role in local revenue generation.

The noticeable increase in foreign tourists is evident across Japan, particularly in larger cities like Osaka, Kagoshima and Kumamoto, where tourism hotspots are bustling.

LDP Leadership Race Update

The Liberal Democratic Party (LDP) leadership race is culminating this Friday, featuring an unprecedented nine candidates, the largest number in postwar Japanese history. Unlike previous elections, candidates are campaigning without factional support, leading to diverse discussions on various issues. However, debates have been described as somewhat lackluster. Candidates have avoided direct attacks on each other due to their need to collaborate with each other, post-election. 

Recent Developments:

Candidates have been group-traveling across Japan, visiting prefectures like Okinawa and Osaka to engage with rank-and-file members. Three live-streamed debates on policy are to take place over the next few days, expected to heighten competition and clarity among candidates. The Unification Church scandal has resurfaced as a topic of concern, particularly relating to past affiliations of certain factions within the LDP.

Next Steps:

The race will conclude with the election on Friday. Observers are advised to tune into further discussions, including insights from pundits Dan Harada and others, as the landscape could change significantly in the coming days.

U.S.-Japan Joint Operational Office

The United States and Japan have established a joint operational office in Tokyo to enhance collaboration between their self-defense forces and U.S. military operations. This agreement, solidified during Prime Minister Kishida’s visit to Camp David with President Biden, represents a significant step in military cooperation.

The current Status of Forces Agreement (SOFA) governs U.S. military operations in Japan, particularly in Okinawa, but the new joint office aims to streamline operations and enhance coordination across Japan. The operational control of U.S. forces will now rest with the Japanese Self-Defense Forces, led by three generals, marking a notable shift in military dynamics.

Operational Details:

The first working group meeting for the joint operational command took place this week. This indicates the beginning stages of this collaborative effort. The establishment of the office is likely to lead to an increase in flag officers stationed in Japan, particularly in Tokyo, to support this joint command structure.

Regional Security Context:

The backdrop of this development includes increased military activity in the region, particularly:

• The recent passage of a Chinese aircraft carrier through waters near Okinawa, raising concerns over territorial integrity and regional security;
  • Airspace violations by Chinese aircraft;
  • Continued missile tests by North Korea, contributing to heightened tensions in the Indo-Pacific.

Implications:

This joint operational office reflects a deeper commitment to regional security and military cooperation between the U.S. and Japan, particularly amid escalating threats from China and North Korea (and to a lesser degree, Russia). As the participating parties refine logistics and operations, observers expect increased (not just U.S. but British, Australian, Philippine, French, Canadian, maybe even Indian?) military presence and a vastly-more integrated defense posture in the region. This is morphing fairly quickly.

Questions & Comments from The Audience Answered Exclusively During the Briefing

• Given the circumstances, could the incoming LDP President potentially revoke all punishments, or at least lift suspensions for individuals like former Minister Nishimura, who has no known record of financial corruption, in the name of “party unity”?
• In a recent TV roundtable, LDP Secretary General Motegi and others claimed to have the strongest, most viable connections with the next U.S. administration. Objectively, who seems to have built the strongest network of relationships in this area? 
• Could the LDP’s decision not to punish Ms. Takaichi for breaking the mailing rule lead to a loss of public trust in the party? 
• With most LDP factions dissolved by PM Kishida, some think they might return in a new form after he steps down, while others believe the party must eliminate the “kingmakers” to move forward. What’s your view on this, and what do you expect in the LDP’s future?
• Do bureaucrats want factions? Having too many points of contact creates too much work.