Takaichi Faces Triple Test: Security, Economy, and Japan-South Korea Relations

An Uneasy Coalition with the Japan Innovation Party
Trump's Visit to Japan, APEC Summit, and More
A Mountain of Challenges from Diplomacy to Domestic Price Stability

Amid the uneasy partnership between the reformist Japan Innovation Party and the deeply conservative Liberal Democratic Party, the Takaichi Cabinet has embarked on its maiden voyage. From its very inception, the Takaichi administration faces a triple challenge: public anxiety stemming from soaring prices and stagnant wages, the first visit to Japan by President Donald Trump, and the future of Japan-South Korea relations, which had improved under the previous Ishiba Cabinet. In particular, changes are expected in Japan-South Korea relations, which had seen a thaw under the leadership of former Prime Minister Shigeru Ishiba, who was known for his relatively moderate views on historical issues.

Japan's new Prime Minister Sanae Takaichi (right) is speaking at a press conference held at the Prime Minister's Official Residence in Tokyo on the 21st. Photo by AFP Yonhap News

Sanae Takaichi, President of the Liberal Democratic Party, was officially elected as Japan’s 104th Prime Minister on the 21st, after securing a majority in the parliamentary vote. The Liberal Democratic Party has formed a coalition government with the right-leaning Japan Innovation Party, the second-largest opposition party, but even when combined, they do not hold a majority in the Diet. Furthermore, the Japan Innovation Party has shown a passive stance by not sending any ministers to the new cabinet. As a result, there is a prevailing assessment that the two parties are in a precarious partnership that could collapse at any moment. In an editorial on the 22nd, the Asahi Shimbun pointed out, "The fragility of the LDP-Innovation coalition, which fails to secure a majority in both the House of Representatives and the House of Councillors, is evident not only in numbers but also in form." Prime Minister Takaichi also acknowledged the limitations of the coalition government, stating, "Even with the Liberal Democratic Party and the Japan Innovation Party combined, we do not reach a majority," and described the minority ruling party system as a "difficult start."

While the political foundation is weak, the administration faces a mountain of policy challenges. The most immediate issue is domestic price stability. The abrupt resignation of former Prime Minister Shigeru Ishiba was the result of public discontent over rising prices and declining real wages, which led to a sharp drop in approval ratings. As Japan’s prices, which had remained virtually stagnant during the "lost 30 years," have steadily risen in recent years, there is a growing chorus within Japan demanding wage increases and tax cuts.

At her inaugural press conference, Prime Minister Takaichi promised to "raise the annual income tax deduction threshold of 1.03 million yen to increase real income and reduce the burden on households." She also instructed the cabinet at its first meeting to formulate economic measures and pledged to establish concrete responses to rising prices. This demonstrates her strong commitment to tackling inflation and is seen as an effort to differentiate herself from the previous administration, which was perceived as ineffective in addressing price increases.

Looking outward, the Prime Minister must immediately handle a series of diplomatic events starting next week. On the 27th, President Donald Trump will visit Japan for the first time since his second term began. During this visit, President Trump is expected to once again press for an increase in Japan’s defense spending. Prime Minister Takaichi has already ordered the early revision of the "three major security strategy documents (National Security Strategy, National Defense Strategy, and Defense Force Development Plan)" in line with U.S. demands. This is seen as a preparatory step to institutionalize increased defense spending and, at the same time, as a diplomatic move to win President Trump’s favor. The Guardian reported, "Her diplomatic skills will be put to the test when President Trump visits Tokyo for a two-day stay next week," adding, "She will have little time to catch her breath before making her international debut at the APEC summit in South Korea."

However, there are concerns that such moves could conflict with Prime Minister Takaichi’s "Japan First" policy, which she pledged during the election. If she is seen as excessively accommodating the Trump administration’s demands, there is a possibility that she will face criticism from domestic political circles and public opinion for abandoning the "Japan First" approach. The Washington Post analyzed, "Some of the demands from the Trump administration may conflict with her 'Japan First' stance, and the Liberal Democratic Party, which is rapidly losing public trust, faces the dual challenge of rebuilding its weakened political support."

From South Korea’s perspective, there is keen interest in whether the improved Japan-South Korea relations seen under the Ishiba Cabinet will be maintained or will once again cool. Prime Minister Takaichi stated, "I look forward to meeting President Lee Jaemyung," emphasizing, "South Korea is an important neighboring country for Japan, and the significance of Japan-South Korea relations has grown even greater." She also highlighted her pro-Korea image by saying, "I enjoy Korean seaweed and cosmetics, and I often watch Korean dramas."

In the past, she has continued visits to Yasukuni Shrine, a symbol of Japanese militarism, and has taken a hardline "hawkish" stance on issues such as Dokdo and historical disputes. Her remarks on this day are interpreted as an attempt to ease concerns by emphasizing her willingness to cooperate with South Korea, seemingly conscious of her existing image.

Le Monde analyzed, "With historical issues between Japan and South Korea still unresolved, even if Japan’s new leadership promises progress, domestic political colors could become an obstacle to bilateral relations."

This content was produced with the assistance of AI translation services.