FX.co ★ Japan’s LDP to Choose New Leader Amid Rising Risks

Japan's ruling Liberal Democratic Party (LDP) is set to elect a new president on Saturday, a position that traditionally leads to the role of prime minister. The election sees five candidates vying to replace Shigeru Ishiba, who is stepping down following recent electoral challenges. The contest is primarily between Sanae Takaichi and Shinjiro Koizumi, whose policy proposals differ significantly. Takaichi, a conservative nationalist aligned with the late Shinzo Abe, is advocating for a bold fiscal stimulus to invigorate the economy and may consider revising the U.S.-Japan trade agreement if it is found to be unfair. In contrast, Koizumi, alongside Cabinet Secretary Yoshimasa Hayashi and other contenders, favors providing tax relief to households while maintaining Ishiba's prudent economic approach. Takaichi aims to double Japan’s economic size within ten years through extensive government investment in technology, infrastructure, and food security. The new leader will inherit challenges such as a divided party, sluggish economic growth, and the diplomatic spotlight of hosting U.S. President Trump in Tokyo at the end of October.