Japan: Recession, Political Scandals

After Japan has slipped from third to fourth place among the world’s largest economies, the government led by Prime Minister Fumio Kishida has been at the center of harsh criticism from both the opposition and the public. Several opinion polls conducted in recent days by some Japanese newspapers have shown that the conservative government is losing support. Kishida’s popularity has hit a record low, and many analysts believe the Liberal Democratic Party may replace the leader in September.

Japanese public opinion accuses the Kishida government of dragging the country’s economy into recession: according to government figures, Japan’s GDP in 2023 was lower than that of Germany, which therefore became the world’s third largest economy. The figures show how the Japanese economy is gradually losing competitiveness and productivity, and the population is shrinking due to its aging and low number of children. Last year, Japan’s nominal GDP totaled $4.2 trillion, which is about ¥591 trillion. Germany had about $4.5 trillion.

But more than economic problems, Kishida’s credibility has been shaken by a series of political and corruption scandals. The latest and most serious scandal in recent decades for Japanese conservatives, which has already led to the resignation and arrests of several government members, concerns alleged “gray” funds irregularly collected by influential members of Kishida’s party.

The Prime Minister is one of the leaders of the Liberal Democratic Party of Japan (LDP) and has been Prime Minister since the end of 2021. Recent opinion polls confirm that Kishida’s popularity is now in free fall, so talk is already circulating about his possible replacement. LDP elections are scheduled for September next year and will elect a new president, who will also become prime minister until the next general election scheduled for July 2025. In Japan, the leader of the majority party is appointed as prime minister.