In the early morning of November 1, the results of Japan's 49th House of Representatives elections were officially announced, and the ruling coalition of the Liberal Democratic Party and the Civic Party won a total of 293 seats.
On the same day, the Japanese stock market rose sharply, with the Nikkei 225 index surging 2.61% to close at 29647.08 points, a new high since September 22, the largest gain since June 22; the benchmark Topix index rose 2.2%, the biggest gain since September 24.
The analysis pointed out that the victory dispelled fears that Kishida Fumio might become the next short-term prime minister after Suga, and paved the way for Kishida's government to begin implementing economic stimulus measures.
The barrier has been cleared
On October 31, 1,051 candidates from nine political parties competed for 465 House seats, and in the end, Kishida Fumio and his Liberal Democratic Party, which had been in power for less than a month, won 261 seats, a slight decrease from the 276 seats in the previous parliament, but still had a clear advantage over other parties. The Komeito Party won 32 seats, the Cadets 96, the Japanese Communist Party 10, the Japan Restoration Association 41, the National Democratic Party 11, the Reiwa Shin-kumada 3, the Sponddrome, and 10 unaffiliated. The ruling coalition, made up of the Liberal Democratic Party and the Komeito Party, won a combined 293 seats, more than half of which will remain in coalition rule.
According to NHK, the COVID-19 response and economic recovery, as well as evaluation of former Prime Minister Shinzo Abe's long-term regime, are the focus of the election debate. Despite the poor results of the LDP and Komeito coalition regimes in fighting the epidemic and stabilizing the economy, compared with the chaotic and disorderly opposition forces, Japanese voters eventually handed over the ruling power to a coalition government composed of both the LDP and the Komeito party.
Commenting on the election results, Kishida said that ensuring a majority of the seats of the ruling party in this "election to choose the regime" is a very important achievement that will allow the administration and the operation of the Diet to proceed smoothly.
Chen Zilei, vice president of the National Japanese Economic Association and director of the Japan Economic Center of Shanghai University of International Business and Economics, said in an interview with the International Finance News that the house election stabilizes the unity of the party, and next summer's house election will stabilize the regime. Only by leading the LDP to victory in the two elections can the unity within the LDP be realized, and then gain the support of the people, and can Japan's political situation be stabilized.
Tobias Harris, a senior fellow at the Center for American Progress, a U.S. think tank, said the overall trend was good for stability and that the LDP had cleared the hurdles it absolutely needed to clear.
The stimulus is on the string
After Kishida's victory in the LDP presidential election on September 29, Japan's stock market fell for eight consecutive days, erasing all of Its September gains, as the market worried about how far Kishida could lead the new government. At the same time, Kishida's economic policies lack specific details.
Kishida has pledged to enact measures worth tens of trillion yen shortly after the vote and hopes to pass an additional budget by the end of the year to support those affected by the pandemic, such as those who are unemployed and students who have difficulty paying their tuition fees, Japan's national public broadcaster NHK reported.
Takahiro Sekido, chief Japanese strategist at Mitsubishi Nikka Bank in Tokyo, said the fiscal stimulus package should pass smoothly thanks to the majority.
A Reuters survey showed that Japanese companies strongly want the government to set a supplementary budget of at least $90 billion to alleviate the difficulties caused by the new crown epidemic, showing support for Kishida's additional stimulus program.
In addition to economic policies, polls show that Japanese people are also concerned about epidemic prevention measures, social welfare, child-rearing and low-birthrate measures.
Since coming to power, Kishida has been advocating a "new type of capitalism" to solve the growing gap between rich and poor in Japan through growth and redistribution.
According to the Organisation for Economic Co-operation and Development, average wages in Japan have been stagnant over the past 30 years compared to countries such as the United States and Germany. Progress in productivity indicators has also been limited, and Japan's gdp per capita has fluctuated and is currently at the same level as in 1994.
Some commentators have pointed out that the main root cause affecting Japan's economic development is the system problem, and whether Kishida's economic policies can be implemented still needs to be observed.
This article originated from the International Finance News