Japanese Politics Updates – March 30, 2025

Welcome, Japan Hands!

Good morning from Tokyo! The cherry blossoms are blooming, the weather is swinging between seasons, and Japanese politics is anything but dull. This past week, we witnessed the culmination of a bruising budget battle, a flurry of international diplomacy, and powerful reminders of Japan’s wartime past. I am reporting this week from my floating studio in Katsuyama, Chiba. So, let’s dive into one of the most consequential weeks of the year so far.

Budget Battle: Deadline Drama, Ishiba Survives—for Now

After a month of parliamentary wrangling and political brinkmanship, Japan’s record-setting ¥115.2 trillion (~$765B) national budget is expected to pass both houses just under the wire on March 31. Here’s how we got there:

• • The Lower House passed the budget in early March, but Upper House deliberations led to key amendments.

• • Those amendments will force the budget back to the Lower House for final approval on Monday, the last day of the fiscal year.

• • The ruling LDP-Komeito coalition, lacking a Lower House majority, relied on support from Ishin-no-Kai to secure the necessary votes.

• • Opposition parties extracted concessions on education subsidies, medical expenses, and tax thresholds, making this one of the most hotly contested budgets in recent memory.

While Prime Minister Ishiba will likely breathe a sigh of relief when the budget squeaks through, the political bruises remain visible. His popularity continues to slump. Support is hovering around 27%, and his ability to lead the LDP into upcoming elections is increasingly in doubt.

Diplomacy on Overdrive: Brazil, China, and the US Defense Chief

This was a whirlwind week for Japan’s foreign relations:

1. 1. Brazil’s President Lula visited on a full-blown state trip, culminating in over 40 economic and security agreements, including cooperation on trade, climate, and regular head-of- state summits. Brazil remains a major partner—Japan imports 60% of its ethanol from Brazil.
   2. At the Japan-China-Korea economic summit in Tokyo, a diplomatic spat broke out after China misrepresented comments by PM Ishiba, claiming he endorsed Beijing’s Taiwan policy. Japan formally protested, but the misinformation remained onChina’s foreign ministry website.
   3. US Defense Secretary Pete Hegseth visited Japan and made headlines with his historic stop at Iwo Jima, marking the 80th anniversary of that battle. His presence in Tokyo reflects rising regional security tensions and ongoing negotiations over defense spending.

Amid these visits, Japan’s diplomatic balancing act is becoming increasingly precarious. 

1. Trump Tariffs and the Yen: Economic Tensions Rise

The yen weakened to $/¥150.6, continuing a sharp decline from 148 just weeks ago. Several overlapping issues are at play:

• • Trump’s new tariffs on Venezuelan oil and Japanese automotive exports are rattling the markets.

• • A 25% tariff on Japanese automobiles, set to take effect April 2, could dent GDP growth. Some analysts estimate up to a 0.2% hit.

• • Japan is seeking carve-outs, sending emissaries to Washington in an attempt to minimize the economic blow.

These developments signal a tough road ahead for Japan’s trade-reliant economy, especially as Tokyo tries to navigate the shifting sands of Trump’s second term.

Campaign Contributions Law: Promise Unkept, Fractures Exposed

The LDP/Komeito and the Opposition Parties essentially pledged to pass a revised campaign contributions law before the end of March. However, this is not going to happen.

• • Proposals ranged from a total ban on corporate donations (favored by the CDP and Ishin) to higher transparency thresholds (LDP’s position).

• • Even a middle-ground proposal failed to gain traction.
  • The issue, fueled by past LDP scandals, remains a political liveware and will be a key campaign issue.

1.  This failure underscores not only the dysfunction in Japan’s political class but also Ishiba’s waning authority—even with allies.

Historic Anniversaries: Iwo Jima, Okinawa, and the Lessons of War

This week marked several solemn anniversaries:

• • The 80th anniversaries of both the Battle of Iwo Jima and the Battle of Okinawa.
  • PM Ishiba and Defense Secretary Hegseth attended ceremonies on Iwo Jima. This is an unprecedented visit by a US Secretary of Defense.

1.  These events serve as powerful reminders of the sacrifices made and the complex history underpinning today’s US-Japan alliance. Something never to forget.

Election Watch: Countdown to June 22

With the budget about to pass, Japan’s political focus now turns to the elections:

• • The Tokyo Metropolitan Assembly elections and the end of the Diet session both land on June 22.

• • Upper House campaigns kick off June 26 and run for 17 days.

• • Opposition parties are preparing for a possible no-confidencemotion over surname law and other issues.
  • If Ishiba is to be replaced as PM before the election, the LDP must act fast. Currently, many believe the window closes within weeks. 

All signs point to a heated and potentially transformative election season.

Questions from the Audience Answered Exclusively during the Briefing

• • How is Defense Secretary Hegseth’s visit being perceived in Japan?

• • What message does this visit send about US alliances?

• • Will Japan invest more in the US economy as a diplomatic chip?

• • Is a leadership change in Japan still on the table?

• • Will Japan support France’s bit to help Ukraine militarily? And what is Japan’s stance overall regarding Ukraine… what does Japan contribute?

• • Could Japanese and US automakers collaborate more closely (e.g., Toyota and Tesla)? 

Final Thoughts: Transition Time

•  With the budget passed, Ishiba’s remaining utility as PM may be spent. He delivered on three critical tasks:1. Met with President Trump.

Secured opposition support in order to pass the Budget. 3. (Almost) passed the budget on time.

But there’s no gold star—just survival. Now, Japan braces for a turbulent spring, a packed campaign season, and increasing geopolitical uncertainty.

We’ll be tracking every twist and turn. Thank you, as always, for being part of this community. Like, Share, and Comment—and we’ll see you next Sunday.

Stay curious. Stay engaged.