January 10, 2020

JAPAN: Abe will continue to seek his legacy abroad as succession race heats up

BY Tobias Harris

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( 5 mins)
  • Now in his eighth year, Prime Minister Shinzo Abe will continue to look to foreign policy in order to cement his legacy as Japan’s leader. His domestic agenda for 2020 is slight.
  • Domestic politics will be preoccupied with the race to succeed Abe as the end of his term as Liberal Democratic Party (LDP) approaches in September 2021.

Key issues to watch in 2020 include the following:

Rapprochement with China: While an expected state visit by President Xi Jinping in the spring will be an important symbolic moment for the truce between Japan and China, their relationship will nevertheless continue to struggle with tensions surrounding the dispute over the Senkaku (or Diaoyu) Islands in the East China Sea, Japan’s anxieties about China’s burgeoning military power and industrial policies, and widespread distrust of China among the Japanese public.

Abe as peacemaker: After reports suggesting that Abe would scrap a Middle Eastern trip due to heightened tensions between the US and Iran, Abe will depart on 11 January for a swing through Saudi Arabia, the United Arab Emirates, and Oman as his government prepares to dispatch a naval mission to the region. As the prime minister looks to cement his diplomatic record, he will likely step up his efforts to stabilize the region and prevent conflict between the US and Iran from spiraling out of control (which would harm Japan’s economy). Closer to home, he will continue to seek breakthroughs in longstanding disputes with Russia (over the disputed South Kuril Islands) and North Korea (over Pyongyang’s abductions of Japanese citizens) as part of what he has called the “settling of the accounts of postwar diplomacy.” But there are few signs of a breakthrough on either front.

Trade leadership: After spending 2019 focused on trade talks with the US, Abe could retake the offensive on trade liberalization in Asia. Not only is the Regional Comprehensive Economic Partnership (RCEP) likely to be signed early this year – and Japan will in all likelihood be a signatory, despite rumors that Japan could back out if India is ultimately excluded – but Tokyo may now be able to devote greater attention to seeking new members for the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP). In Bangkok on 7 January, Foreign Minister Toshimitsu Motegi stated that Japan would cooperate to the greatest extent possible to facilitate Thailand’s accession to the bloc. The Abe government will also likely move quickly to conclude a bilateral agreement with the United Kingdom, which could be a first step towards British membership in CPTPP.

Alliance management: While the year began with the US-Japan bilateral trade agreement coming into force, 2020 could see Abe on the defensive again as the two governments commence negotiations for a new special measures agreement (SMA), which dictates how much Tokyo will contribute to the maintenance of US forces in Japan. The Trump administration’s negotiations with South Korea suggest that Japan could face politically difficult demands in negotiations.

Constitutional revision: Abe has once again called for the Diet to begin deliberations on changes to Japan’s constitution, but the opposition is unlikely to cooperate – and Abe is unlikely to force the matter – meaning that for another year revision is unlikely to go anywhere.

Economic management: The Abe administration, already facing signs of a gloomier economic climate and anticipating a slowdown after the Tokyo Summer Olympics, has unveiled a significant stimulus package that will run through the end of FY2020 in March 2021. While the Bank of Japan (BOJ) will face some scrutiny as to whether it will tinker with its easing policies, the Abe administration’s overall approach to macroeconomic policy is unlikely to deviate this year.

Social security reform: Despite Abe’s determination to prioritize social security reform this year, his administration will proceed cautiously and will most likely tinker with the existing system – mainly to enable the increasing number of Japanese who remain in the workforce past retirement age to contribute to the pension system – instead of seeking wider-reaching cost controls or cuts. The administration has hinted that it could introduce legislation in the second half of 2020 that would make Japanese over the age of 75 pay more out of pocket for medical care, but this reform could face public opposition.

Political opposition: When the Diet reopens for its ordinary session on 20 January, Abe will likely continue to face questioning regarding his administration’s handling of the government’s cherry-blossom viewing party. The government could also face questioning regarding its push to legalize casinos after an LDP lawmaker was arrested in connection with an investigation into allegations of bribery by a Chinese company. Abe is unlikely to be personally harmed by either scandal, but they could nevertheless hinder his domestic agenda. Whether opposition parties, who have been engaged in unification talks, are able to unite will affect whether the scandals affect Abe as well as whether he is tempted to call a snap election. A snap election is unlikely before the Summer Olympics, but it could be part of Abe’s calculations as he heads into the last year of his term.

Post-Abe: After Abe identified four potential successors – Foreign Minister Motegi; Chief Cabinet Secretary Yoshihide Suga; Health, Labor, and Welfare Minister Katsunobu Kato; and LDP policy chief Fumio Kishida – in December, the race to succeed him will intensify, with these four and others (former cabinet ministers Shigeru Ishiba and Seiko Noda) jockeying for position. While conventional wisdom says that Abe prefers Kishida, in part because he is seen as weaker and therefore more susceptible to Abe’s influence behind the scenes, the foreign policy agenda could enable Motegi to bolster his claim. The outlook will likely be clearer by year’s end, not least because the succession race will be strongly influenced by the outcome of the US presidential election; if Donald Trump is reelected in November, managing Trump will be the single most important criterion for selecting a new leader (which could also prompt a rule change that would enable Abe to run again).

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