Kishida's mixed record, poor fiscal discipline may lead to abrupt policy shifts

Lack of clear successor opens door to PM candidates with vastly different policy ideas

- Walter Sim

Japanese Prime Minister Fumio Kishida swept to power in 2021, buoyantly touting his "ability to listen" and vowing to show that his party had been "reborn".

In doing so, he championed his trademark policies: a "new form of capitalism" to ensure wealth distribution, and a "digital garden city vision to use digital services to solve rural issues.

Three years on, he is seen as tone-deaf, while these signature slogans have all but quietly fizzled out. And politics has come full circle as he bows out due to scandals.

As the 67-year-old said on Aug 14 that he was stepping down, he exhorted his successor, who will be picked in ruling Liberal Democratic Party (LDP) polls in September, to "present a new LDP to the public" Yet experts are divided on Mr Kishida's domestic legacy, including wage increases and market optimism that led the Nikkei 225 stock index to finally break through the historic 1989 high in July 2024.

Whoever comes to power will also be saddled with the burden of finding ways to fund Mr Kishida's heavy spending plans in defence, decarbonisation and childcare.

The Premier has also said that Japan should financially support its home-grown semiconductor industry.

Mr Kishida had, likely with an eye on his abysmal support, dithered on a more decisive funding plan that the public, spooked by rising costs of living, will not stomach well.

Instead, he leaves his successor with vague proposals that taxes will be gradually increased on personal income, corporate revenues and cigarette purchases - without any clear timelines.