Japanese Politics Updates – June 29, 2025

Welcome Japan Hands around the world. Today I am broadcasting from the deck of Gryms in Habu Port on Oshima Island, a six-hour solo sail from my home-port of Hota. Timothy opened Episode #229 amid high winds of political turbulence. And a 6 hour return sail after completing this weekly conversation with you. Thank you for always tuning-in!

Opening Summary

• Yen closed at 160.42 to the dollar; Middle East tensions and not-great tariff negotiations blamed.
• Prime Minister Ishiba cancels NATO summit appearance AND 2+2 talks in D.C. The looming US insistence on 3.5% GDP defense-spending seen as a major reason.
• Tokyo’s Metropolitan election results hit hard: LDP lost 9 seats, slips from 30 to 21 of 127 seats. Independents and minor parties advancing significantly; Governor Koike’s Tomin First flips to largest party.
• Formal campaigning for the Upper House election begins July 3. Party maneuvering intensifying in the aftermath of the Metro race lessons.
• Double election doubtful but the tactical utility persists — not quite zero.
• The ¥20,000 to all adults stirred public backlash, overshadowing real policy concerns like rice price inflation.
• Execution by hanging of ‘Twitter Killer’ on Thursday by Justice Minister Suzuki re-ignites capital punishment debate in Japan.
• Shohei Otani’s ex-interpreter Ippei Mizuhara begins 57-month U.S. federal prison sentence for embezzling over $17 million.
• Chinese fentanyl factory discovered in Nagoya; shipments bound for the U.S. Officials alarmed at Chinese brazenness.
• Chinese airspace incursions continue with increased frequency, further pressuring Japan’s defense policy and regional posture.
• Trump’s 90 day pause ends July 9 — markets are reacting to preparations led by Chief Negotiator Akazawa and his delegation. Not looking so good.

Yen Volatility and Oil Market Shock

The yen ended the week at 160.42 against the dollar, having breached the critical psychological 160 threshold. Volatility triggered by bunker-buster munitions in Iran spiked oil prices at $86/barrel and raised fears of broader escalation. Combined with the looming July 9 tariff deadline and Trump’s hints of renewed economic brinksmanship, the week ended in market tension. Japanese and U.S. monetary authorities remained cautious but active behind the scenes.

Ishiba Retreats as Electoral Reality Bites

Prime Minister Ishiba cancelled his participation in the NATO summit and postponed the much-anticipated 2+2 security talks in Washington. The Tokyo Metropolitan election results reverberate through party ranks and ignited internal debate on campaign strategy, urban outreach, and coalition stability.

Upper House Campaign Begins, Double Election Fades

Campaigning for the 124 Upper House seats kicks off Thursday, July 3. More manifestos, more loudspeakers: 17 days. Most believe a double election is unlikely, but the strategic ambiguity lingers.

Rice Politics and the ¥20,000 Backlash

Japan’s deepening agricultural dilemma — particularly the politics of rice — compounds rural frustration due to cost spikes and neglect. The blanket ¥20,000 payout to all adults, rather than easing tensions, has generated anger and skepticism — seen as electoral bait rather than genuine relief. Opposition making bacon of this one.

Capital Punishment Rekindles Public Debate

Justice Minister Suzuki authorized the June 27 execution of Takahiro Shirashi, the ‘Twitter Killer’, again sparking public debate on Japan’s use of the death penalty, its secrecy, and justice system ethics. The condemned essentially gets no notice: just walked to the gallows on the day of decision.

Fentanyl Factory in Nagoya Alarms Officials

In foreign affairs, news broke of a fentanyl production site in Nagoya tied to illicit exports to the U.S. The incident has raised serious questions about domestic oversight and cross-border trafficking.

China Escalates Military Pressure in East Asia

And as Tokyo absorbs these shocks, China continues to test Japanese airspace boundaries — with little global media attention. Two aircraft carriers now exercising east of the first island chain; 1,120 sorties flown; Chinese jet swoons dangerously close to a SDF plane in international waters; airspace violations over Okinotori and Iwojima. These provocations could factor heavily into the upcoming defense posture review.

Q&A Highlights

• How many seats did the LDP lose in the Tokyo Assembly election, and what does this indicate nationally?
• What is the legal threshold and deadline for passing a no-confidence motion in time to force a double election?
• Are rice prices a real economic crisis or just campaign-season symbolism?
• Which minor parties or coalitions made the biggest gains in Tokyo — and could they scale nationally?
• What is the likelihood of the Lower House dissolving before July 20?
• Does Ishiba’s cancellation of NATO and U.S. talks signal political retreat or strategic recalibration?
• Will the Nagoya fentanyl case impact U.S.-Japan law enforcement ties or trigger new legislation?

Final Thoughts

This week’s broadcast finds Japan at a hinge moment: a politically chastened ruling party, a resurgent opposition, a yen in distress, and geopolitics intruding on domestic calm. Ishiba’s team faces monumental choices in days — not months. The nation watches to see whether boldness or caution defines this moment.

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