Japanese Prime Minister Fumio Kishida attends a State Department luncheon held in his honor in Washington, U.S., April 11, 2024.
Craig Hudson | Reuters
107282694Japanese Prime Minister Fumio Kishida announced on Wednesday that he will not run in the Liberal Democratic Party’s presidential election next month.
According to a Reuters translation, Kishida told a news conference that it was important for the LDP to have a new face at the helm and that a “first step” would be his resignation. He added that he believed his resignation was necessary for the LDP to regain public trust.
The Prime Minister also promised to fully support the new leader.
Kishida’s decision not to run for re-election effectively means he would step down as prime minister when the party elects a new leader, ending his three-year term.
He said the decision was taken in the interest of the country’s people, adding that to achieve a complete exit from the country’s deflation-prone economy, wage and investment growth must be encouraged.
Japan has been battling persistent deflationary pressures that have gripped the country’s economy since the 1990s.
The ruling LDP is mired in a political donation scandal. The issue is the misdistribution and underreporting of funds from fundraising parties by the party factions, which led to the arrest of the ministers involved. In early January, Kishida dissolved the largest faction of the ruling party following the scandal.
Kishida also said that as chairman of the LDP, he had “no qualms” about taking responsibility for “problems caused by members” and that he had been thinking about the responsibility as chairman since the financing scandal emerged.
The local news portal Kyodo and the broadcaster NHK had previously reported on the news.
According to a recent opinion poll by broadcaster NHK, 25 percent of those who “support” the Kishida cabinet are in favor, while 55 percent do not.
Kishida took office in October 2021 and was one of the main challengers to former Prime Minister Yoshihide Suga in the race for the LDP chairmanship in 2020 when the late former Prime Minister Shinzo Abe unexpectedly resigned due to health reasons. Suga resigned just a year after taking office.
“September will see the most uncertain LDP election in years, with no clear successor to Kishida,” said William Pesek, author of “Japanification: What the World Can Learn from Japan’s Lost Decades.”
Pesek suspects that possible candidates include Defense Minister Shigeru Ishiba, former Foreign Minister Yoshimasa Hayashi, Digital Minister Taro Kono and Economic Security Minister Sanae Takaichi.
Regardless, the next prime minister “will not have much of a honeymoon,” he said in an email to CNBC.
“Kishida has achieved virtually nothing in restructuring the economy, which is urgently needed now as inflation outpaces wages and investors, driving stock prices to record highs, fear that irrational exuberance is outpacing underlying economic fundamentals,” he said.
