(Bloomberg) — Although Shinzo Abe has resigned over health problems, few are anticipating drastic changes from the next Japanese prime minister. His most likely successors may only tweak Tokyo’s approach to everything from China ties to monetary policy.
After taking power in 2012, Abe touted unprecedented monetary easing and a flexible fiscal policy to revive the economy — a package dubbed “Abenomics.” He worked to build a personal bond with U.S. President Donald Trump, while at the same time seeking to smooth over ties with Japan’s biggest trading partner, China.
One of the reasons Abe endured to become Japan’s longest-serving prime minister was the lack of open dissent in the ruling Liberal Democratic Party. Some potential candidates may have held fire while he was in office, but a large degree of continuity is likely in managing the world’s third-largest economy.
“There is little choice but to continue with aggressive fiscal policy and monetary easing” given the state of the economy, especially after the pandemic, said Hiroshi Miyazaki, senior economist at Mitsubishi UFJ Morgan Stanley Securities. “If a new leader wants to upend economic policies, that would cause yen gains and stock falls. No one wants that.”
Here are some of Abe’s most likely successors:
Shigeru Ishiba, 63, former defense minister
No national election need be held until 2021, so a new LDP leader would succeed Abe as premier. Polls show Ishiba is the voters’ top choice to take over. He has backed economic policies seen as more populist than Abe’s and said in an interview in April that too much wealth was accumulating in the hands of stockholders and company owners. He has also cast doubt on the sustainability of the Bank of Japan’s monetary policy.
On the international front, Ishiba has been aligned with Abe in trying to keep ties with China on a steady path. Ishiba last month urged an LDP group to think about the consequences of its call for the cancellation of a planned state visit to Tokyo by President Xi Jinping. Ishiba, however, has been far more hesitant than Abe about attempting to change the country’s pacifist constitution.
Taro Kono, 57, defense minister
Current Defense Minister Kono is a fluent English speaker and graduate of Georgetown University. He expressed interest in an interview with the Nikkei newspaper earlier this month in working closely with the so-called Five Eyes intelligence alliance, which brings together Australia, Canada, New Zealand, the U.K. and the U.S. That could suggest he is willing to step up joint pressure on China.
In 2017, Kono urged the Bank of Japan to lay out a strategy for exiting its ultra-easy monetary policy. He is also known for favoring cost-cutting policies and this year canceled plans to deploy the Aegis Ashore ballistic missile defense shield from U.S. firm Lockheed Martin Corp., citing the cost of adapting it to meet Japan’s safety requirements. The move was popular with voters.
Fumio Kishida, 63, former foreign minister
Abe has touted Kishida as a potential leader, appointing him as foreign minister and then to a senior party post. But the mild-mannered former banker has so far failed to build a public profile.
Seen as more dovish than Abe, Kishida sealed an ill-fated deal with South Korea in 2015 that was meant to end a dispute over women trafficked in brothels run by Japan’s military during World War II. But that accord eventually ended in rancor.
In an interview with broadcaster TV Tokyo on Monday, Kishida said he expected interest rates to remain low, given the state of the economy. He called for plentiful spending to combat the economic crisis, but urged caution on the idea of cutting the sales tax. Kishida also mentioned the need to return to fiscal discipline later.
Yoshihide Suga, 71, chief cabinet secretary
Having served as chief cabinet secretary — or Abe’s right-hand man — since 2012, Suga is a continuity candidate, who could be tapped as a caretaker. In 2007, Abe resigned from an abbreviated first term in office, saying a worsening of chronic ulcerative colitis made it impossible to carry out his duties.
Although Suga hasn’t laid out an alternative policy platform, he has pushed particular issues, including controversial government subsidies for domestic travel during the virus pandemic. “However many times I’m asked, I’m not thinking of it at all,” Suga said in an interview on Thursday when asked if he hoped to succeed Abe.
Taro Aso, 79, finance minister
Aso, like Suga, is part of Abe’s inner circle and is Japan’s long-serving finance minister and deputy prime minister. Given his age, he’d be unlikely to serve as premier for more than a caretaker period. He served an unsuccessful year in the post in 2008-2009, at the end of which the Democratic Party scored a landslide election victory over the LDP.
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