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Fumio Kishida, Japan’s former foreign minister and president of Japan’s ruling Liberal Democratic Party (LPD), takes over as the country’s 100th prime minister. After winning a majority of votes in both houses of the parliament, Kishida was officially elected into the office at a special session of parliament on Monday.
This vote was to be expected since the 64-year-old Kishida won the leadership of the ruling Liberal Democratic Party last week. Kishida with 257 votes defeated Taro Kono, the vaccinations minister, who had been a popular candidate in opinion polls. With LDP holding the majority in Japan’s parliament, this practically made him prime minister-to-be.
Kishida easily won in parliament’s lower house, with 311 votes against the opposition leader Yukio Edano with 124 votes. The upper house also approved him in a vote shortly afterwards.
Kishida will be stepping into the shoes of his predecessor Yoshihide Suga, who resigned from his position after only one year. Suga announced resignation in September after seeing his approval ratings plunge, in the wake of the tepid coronavirus pandemic response in Japan and over his government’s insistence on holding the Olympics amid the virus spread.
It is expected that Kishida will reshuffle the LDP executives and form a new cabinet. The former diplomat is planning to dissolve the House of Representatives by next week and call an election on October 31, as per the NHK television.
As per media reports, all but two of 20 cabinet posts from the Suga administration will be replaced. Foreign Minister Toshimitsu Motegi and Defence Minister Nobuo Kishi are likely to retain their posts, who are both in the Hosoda faction of the ruling LDP. Meanwhile, the former education minister, Hirokazu Matsuno, who is another member of the Hosoda faction, is likely to become chief cabinet secretary. Former Olympics Minister Shunichi Suzuki is set to become Japan’s finance minister, replacing Taro Aso who hold this position in nearly nine years.
The new Japanese prime minister said last week that the new government will aim to promote economic recovery while taking Covid-19 under control. With the launch of the new government, the new leader is also expected to unveil a fresh economic stimulus package worth several tens of trillions of yen.
“Our national crisis continues. We need to keep working hard on the coronavirus response with strong determination, and we need to compile tens of trillions of yen of the stimulus package by the end of the year,” Kishida said in his acceptance speech.
Investors prospects under Kishida government?
Investors are hoping a large fiscal package will boost the world’s third-largest economy and help it recover from the pandemic-hit downturn. With the prospects of a new prime minister, market participants are also anticipating fresh policies by the incoming administration to buoy the economy.
According to John Vail, Chief Global Strategist at Nikko Asset Management, the prospects for the Japanese economy and stock market look very promising as the virus recedes.
“Corporate profit margins surged to an all-time high in second quarter, and the top line should boost such further especially impressively in the fourth quarter as the economy re-opens,” he added.
