Japanese prime minister Sanae Takaichi’s conservative coalition saw a landslide election win on Sunday, with results estimating the Liberal Democratic Party (LDP) now has a two-thirds majority in the lower house of parliament.
Takaichi, the country’s first female prime minister, had called the election just four months after becoming party leader.
Sunday’s election estimates reveal the LDP has won about 300 of the 465 seats up for grabs, which is the best result the party has seen since 2017 under Takaichi’s mentor, assassinated former Prime Minister Shinzo Abe.
As Japan’s debt remains at twice the size of the country, Takaichi’s coalition campaigned under the promise of fiscal responsibility.
Takaichi, 64, has pledged to suspend the food consumption tax, which is an effort aimed at addressing the country’s cost-of-living concerns. Critics argue the government will have to think about how to replace the lost revenues.
Appealing to nationalist sentiments, Takaichi is also strict on immigration, pro-growth and promises to develop industries, including the semiconductor and AI industries, as well as increasing defence spending.
Her emphasis on security has seen strained ties with Japan’s neighbour, China, while her promise to cut taxes has rattled financial markets.
Last November, Takaichi told Japanese legislators that if China ever used force against Taiwan, a self-governed island that China claims as its own, then the move would constitute a “survival-threatening situation” for Japan.
Following the election win, Taiwan’s president congratulated Takaichi, saying preliminary results “clearly” demonstrated the Japan’s electorate’s “trust and high expectations” in her leadership and vision.
Last week, US president Donald Trump gave Takaichi his “total endorsement” and promised to host her at the White House next month.
Takaichi has also generated support among young voters via social media, with a trending Sanae-mania called “sanakatsu” for products she uses, such as her handbag and the pink pen uses in parliament. A recent opinion poll found voters younger than 30 favoured her by more than 90 per cent.
Sunday’s vote in Japan coincided with up to 70cm of snow forecast in northern and eastern regions, as some voters had to battle blizzards to get to the polls. It was only the third postwar election held in February, with elections typically called during milder months.
In a TV interview as the results were being counted, Takaichi said: “This election involved major policy shifts- particularly a major shift in economic and fiscal policy, as well as strengthening security policy.”
“These are policies that have drawn a great deal of opposition. If we have received the public’s support then we truly must tackle these issues with all our strength.”
Shoki Omori, chief desk strategist for rates and FX at Mizuho in Tokyo told Reuters that while the LDP’s victory removes political uncertainty and strengthens policy execution”, the new government “shifts market focus squarely to how fiscal policy is designed and communicated.”
“Risks from fiscal expansion had already been largely priced in before the election,” he added. “The key question now is whether those risks are reinforced or gradually unwind.”
In Japan, inflation-adjusted wages fell 2.8 percent in November, the 11th straight month of decline in people’s pay cheques, according to Japanese government statistics.