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UPDATED: December 24, 2012 NO. 52 DECEMBER 27, 2012
The Return of Abe
As Japan undergoes a political power transition, problems remain the same
By Ding Ying

JAPAN'S CHOICE: LDP leader Shinzo Abe gives a speech in Tokyo on December 15, the day before his party won a landslide victory in Japan's lower house election (XINHUA/REUTERS)

Five years after his resignation, Shinzo Abe regained his post and a second chance as Japan's top leader. Questions loom over whether he will manage to turn the country around.

To ensure a longer term in power, the next prime minister must make some progress in at least two key fields: the economy and diplomacy.

Domestic pressures

On December 16, the Liberal Democratic Party (LDP) led by former Japanese Prime Minister Abe won a landslide victory in the country's parliamentary election. The LDP won 294 of the lower house's 480 seats, while the incumbent Democratic Party of Japan (DPJ) took only 57. Abe is expected to become the next prime minister at a special parliament session on December 26. The LDP, along with its traditional ally, the New Komeito Party, will form a coalition government.

Hu Jiping, Director of the Institute of Japanese Studies at the China Institutes of Contemporary International Relations (CICIR), said the LDP conducted close cooperation with the New Komeito Party during the election, which is one reason why the LDP chose to form a coalition government although it gained an absolute majority in the lower house.

Moreover, to win approval in both upper and lower houses of the parliament, the LDP needs the New Komeito Party's cooperation. The two parties ran a coalition government from 1999 to 2009, when the DPJ took over. Now they have control over two thirds of the 480 seats in the lower house. In the upper house, however, the DPJ has slightly more seats than the two parties combined.

The planned coalition government doesn't guarantee a stable administration, said Hu, adding that the government is under the restriction of the parliament, especially the upper house. If the LDP can win the upper house election next July, Abe will likely have a relatively long and stable period of administration.

Abe, coming from a blue-blood politician family, has showed a strongly conservative tendency during the election. He took the position of prime minister in September 2006, but resigned a year later due to "health" problems. At a press conference on December 17, Abe said he had complete confidence in his ability to perform as prime minister for the coming term.

During the election period, the LDP accused the DPJ of creating a "lost Japan" in terms of politics, the economy, diplomacy, security and education during its three years in power. The party vowed during the campaign to "win back Japan."

Japan's struggling economy was a main cause of the ouster of the LDP in 2009 and the DPJ in 2012. Abe's first task is to revive the country's economy. According to a recent poll, 49 percent of Japanese people believe the new government's top priority is to manage the current economic recession. Japan's economy has seen negative growth for the past two quarters, performing poorly in the third quarter of 2012 due to decreasing exports influenced by the ongoing global economic downturn, an appreciating Japanese yen and the country's diplomatic policies. If Abe cannot win hearts on the economy, his LDP will be under tense pressure in next July's upper house election.

Currently, the Japanese Government's remaining budget is less than 5 trillion yen (about $59.5 billion). Economists predicted the Abe cabinet will probably have to issue more bonds to cope with growing public expenses, suggesting the "red line" of issuing 44 trillion yen (about $523.6 billion) in government bonds in 2012 will be broken.

Abe also promised the new cabinet will carry out a loose monetary policy to raise Japan's annual inflation rate to 2 percent in a bid to revive the country's economy—a stark contrast to the DPJ's economic policy.

Spurring domestic economic growth, improving employment and giving Japanese people more confidence will be key for the LDP to win the coming upper house election, Hu said.

Abe's conservative stance and the country's rising right-wing sentiment have heightened worries in neighboring countries that the LDP might revise the country's pacifist Constitution to "activate" its right of collective self-defense, elevate the current Self-Defense Forces' status to a national self-defense force, ramp up military spending and fortify its maritime security. The 1947 Constitution that insists on pacifism and bans the use of force has made great contributions to several decades of peace and prosperity in Japan. The famously hawkish Abe is one of the voices appealing for the revision of the current Constitution. During his first term as prime minister, he enlarged the power of the Self-Defense Force by upgrading the Defense Agency to the Ministry of Defense.

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