In August 2024, Japanese Prime Minister Kishida Fumio announced that he will not seek reelection as leader of the Liberal Democratic Party (LDP) and will step down as prime minister when his term concludes at the end of September. Kishida, who became prime minister in October 2021, will have served just under three years—the third-longest tenure of Japan’s eleven prime ministers since 2000, following Abe Shinzo (nearly nine years) and Koizumi Junichiro (five and a half years). His legacy will be unusually split between global and domestic audiences, with his positive international reputation in stark contrast with low domestic approval rates.
Kishida’s Global Legacy: U.S.-Japan Relations, Multilateralism, and Bilateral Ties
From a global perspective, Kishida has seemed in many ways to be just the prime minister that Japan needed. He has been an even-keeled, mild-mannered, and personable leader, working steadily toward strengthening Japan’s international security ties and economic integration with global partners while avoiding the extreme or ideological positions that have historically antagonized its neighbors.
Kishida’s primary security focus has been on deepening ties with the United States to keep Japan solidly under the U.S. security umbrella and to increase Japan’s defense budget, a longtime policy preference of Washington. Under Kishida’s watch, Japan furthered its operational integration between the two countries’ armed forces. He followed his predecessors, Suga Yoshihide and Abe Shinzo, in broadening the U.S.-Japan alliance into an economic and innovation partnership beyond primarily security. Kishida demonstrated he was a staunch ally of the United States by closely following Washington’s restrictions on semiconductor exports to China and immediately joining U.S. sanctions on Russia. In April 2024, Kishida made a well-received speech (in English) to a joint session of the U.S. Congress, opening with jokes and reflections on his boyhood living in New York and reaffirming Japan’s position as the United States’ “closest ally” and “global partner.”
Even as Kishida retained and deepened strong bilateral U.S.-Japan ties, he simultaneously did everything he could to engage in multilateral and bilateral trade agreements and economic relationships with Japan’s immediate neighbors, as well as other global powers including Brazil, Paraguay, Saudia Arabia and the UAE, the Association of Southeast Asian Nations (ASEAN), the UK, Australia, and others. Kishida met with Indian Prime Minister Narendra Modi following the latter’s reelection in 2024, reaffirming Japan’s ties with India in infrastructure and other areas and marking the tenth year of the India-Japan Special Strategic and Global Partnership. Kishida also led Japan in its active engagement with various multilateral partnerships including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Regional Comprehensive Economic Partnership (RCEP), and an assortment of frameworks and dialogues such as the Indo-Pacific Economic Framework for Prosperity (IPEF).
Bolstered by South Korean President Yoon Suk-yeol’s warm posture toward Japan, Kishida deepened ties with South Korea, meeting President Yoon an astonishing eight times between March 2023 and August 2024. At a trilateral summit hosted at Camp David by U.S. President Joe Biden, Kishida and Yoon agreed to frameworks for deepening security ties and communications between the three governments. Kishida also joined the first trilateral summit between Japan, the United States, and the Philippines in April 2024.
On the global stage, Kishida hosted a successful G7 meeting in his native Hiroshima in 2023, with notable side initiatives such as the Hiroshima AI Process to further global agendas for governing generative artificial intelligence.
And even while identifying China as Japan’s primary security threat to justify increased defense spending, Kishida was able to hold two cordial summits with Chinese President Xi Jinping, (adroitly avoiding mention of semiconductor sanctions). Kishida also joined a trilateral summit between Japan, China, and South Korea in May 2024.
Overall, it is safe to say that Kishida’s foreign policy has been widely appreciated by Japan’s global partners.
Kishida’s Domestic Difficulties: Economic Challenges and Political Disasters
Unfortunately for Kishida, some of the very traits that made him popular internationally also contributed to his persistently low favorability domestically. Kishida, who emphasized his skills as a good listener, is fundamentally a compromiser. He has held no extreme views and did not spearhead any potentially controversial or divisive initiatives such as constitutional reform. Being a compromiser may not have been a problem during times of relative stability, but Kishida has had the misfortune of steering Japan through international economic troubles such as inflation and several major political scandals. While the Japanese public clamored for more effective or deeper reforms to combat daily cost pressures from inflation and a weak yen, Kishida’s efforts seemed to be stop-gap measures. Facing political scandals, the public seemed to want deeper political reforms that Kishida was unable to deliver.
Kishida’s popularity peaked in May 2022 at 66 percent. His disapproval rating eclipsed his favorability first the first time in September 2022 (43 percent) and then again in May 2023 (44 percent), from which it never recovered. By July 2024, his approval rating was just 28 percent, while his disapproval rating was 64 percent.
Under Kishida’s watch, the Japanese public has faced inflationary pressures for the first time in decades. Like anywhere else, inflation has put pressure on Japan’s political leadership to take action as consumers feel the squeeze. While Kishida did call for employers to raise wages—which they did, though not necessarily because of his urging—many of his administration’s measures, such as relatively small cash handouts and fuel subsidies, seemed like merely stop-gap measures. Fuel subsidies appeared to contradict his plans for reducing Japan’s carbon footprint, and tax breaks became ensnarled in domestic debates over the fiscal wisdom of increasing Japan’s national debt (approximately 250 percent of Japan’s GDP). Skepticism that such cash handouts and tax breaks were too small to address fundamental issues but costly to the national budget added to the sense that Kishida and the LDP lacked effective ideas or the will to undertake deeper reforms.
As in most advanced industrialized countries, Japan’s central bank makes decisions independently of the political leadership. But Kishida did appoint a new central bank governor, Ueda Kazuo, when the previous governor’s term ended in March 2023. The messaging from Kishida and Ueda was that the bank would maintain Japan’s existing trajectory of keeping interest rates extremely low. Suddenly raising interest rates would place a heavy burden on Japan’s fiscal debt repayments, as well as potentially precipitate a wave of bankruptcies among small and medium-sized firms that would not be able to make interest payments on outstanding loans were interest rates to rise. Japan’s implicit social contract has been to maintain stability through employment in lieu of large social safety nets, but it is a compromise between putting off an industrial restructuring of uncompetitive businesses and avoiding short-term economic pain—a choice that Japan has almost consistently made since the 1990s.
Kishida’s choice of central banker led to an interest rate gap between Japan and other major industrialized countries who raised interest rates aggressively to combat inflation, contributing to an extremely weak yen. While cheap yen bolstered the revenue and profits of Japanese multinational firms with heavy global presences, it raised prices for domestic consumers for imports and made them feel worse off when traveling abroad. As COVID-19 travel restrictions on inbound tourists were lifted, Japan experienced a massive surge of tourists who suddenly found the country to be a low-cost haven for shopping, dining, and tourism. Many Japanese were left with mixed feelings as middle-class tourists from both developed and developing countries seemed to enjoy spending power that exceeded their own.
Kishida’s political challenges began with the shocking assassination of former prime minister Abe in July 2022. The assassin was a dissatisfied man whose family had been torn apart by a religious cult, which Abe had praised in a video. Abe’s assassination led to the revelation that many LDP members had ties to this cult, which media reporting exposed as extremely predatory toward its members but politically savvy enough to systematically send volunteers to help campaign efforts. While Kishida removed cabinet ministers with ties to the cult, it wasn’t enough to keep his popularity from declining. Much of the population thought he should take a stronger stance against the organization and go further in purging his party.
Kishida’s gravest political challenge occurred in late 2022, when a scandal broke over the LDP’s fundraising activities. The LDP has historically been organized into factions, with powerful lawmakers at the head of each faction. Power relations within the LDP have depended on varying alliances and webs of mutual support or rivalry between factions. Most of these factions hold fundraising parties for their members, where attendees pay for tickets. But revenue from these parties had been systematically underreported—roughly 580 million yen (just under $4 million) was allegedly unreported between 2018 to 2022. And politicians, who were given quotas for ticket sales, had received kickbacks to their offices for exceeding their quotas. Kishida’s faction was among those accused of receiving kickbacks—which were not technically illegal, but they had not disclosed their income as the law requires. While the amounts pale in comparison to some political financing scandals in other countries—and it was not clear whether politicians were actually pocketing the money as personal income or just gaining illicit political advantage—the revelations ignited a firestorm in Japan. The behavior seemed to confirm people’s perception of the LDP as corrupt, as the treasurers and accounting heads of several factions, including Kishida’s, were indicted by government prosecutors. By February 2023, Kishida’s approval rating had plummeted to 25 percent.
Kishida’s response was to dissolve his faction and urge others to follow suit. Most did, but the powerful Aso faction declined to do so. Kishida appeared powerless to impose stronger discipline on the party. Of the eighty-five LDP members reported to have received kickbacks, thirty-seven were disciplined and two were pushed out of the party. It took until June 2024 to pass a new campaign financing law, which still included loopholes enabling politicians to amass slush funds much in the same way as before, and would not come into effect for several years. The public’s trust in the LDP was shattered, and Kishida’s approval rating never recovered. In a Nikkei poll in April 2024, 80 percent of respondents said they were unhappy with Kishida’s handling of the fundraising scandal.
“New Capitalism”
As soon as he came to power, Kishida announced that his cornerstone policy would be his strategy for a “new capitalism.” But, almost immediately, he was forced to change course. Kishida had initially said that “new capitalism” would have redistribution at its core, announcing to the Diet that “there cannot be the next [phase of] growth without redistribution,” and suggesting that higher personal income and corporate taxation would help close the gap of social inequity that had been rising since the Koizumi era (2001–2006). Kishida’s announcement was greeted by over a week of falling stock prices, reportedly because businesses feared higher taxes and potential ramifications of redistributive individual tax policies. Critics also pointed to the lack of a forward-looking growth strategy. Kishida quickly shifted course, backing away from talk of redistribution, and eventually settled on four pillars: 1) investment into human capital; 2) strategic investment into science and technology; 3) accelerating the startup ecosystem; and 4) investment into a so-called green transformation (GX) to reduce carbon emissions. Each of these was a commendable and uncontroversial goal, and much of the investment will continue to help Japan’s future. However, they also seemed quite conventional in comparison to the bold promise of a “new capitalism.”
The overall sense that Kishida did not have a strong vision—but was instead moving forward with incremental, uncontroversial steps and willing to compromise at every juncture to avoid creating deep divisions or animosities—did not bestow much confidence in the electorate. For example, to address the unprecedented decline in population and birthrates, Kishida promised “birthrate support policies of another dimension” (meaning an order of magnitude greater). But a cornerstone of his policy ended up being modest monthly allowances to parents—15,000 yen (around $100 per month) for children under three years old and 10,000 ($75 per month) for children between three years old and high school age—that cost the government over $20 billion. While there were some other measures, over 70 percent of the population was skeptical that these measures would be effective, since they did not address the underlying social problems nor were the modest amounts likely to compel prospective parents to actually have children. These measures were seen as typical of the compromises that Kishida would make—modest efforts to address a problem without overcoming the Ministry of Finance’s strong resistance to fiscal expenditures, all the while lacking a strong vision to tackle the root causes.
Japan’s Weak and Fragmented Political Opposition
Despite Kishida’s low approval ratings and the LDP’s unpopularity, Japan’s opposition parties have enjoyed even less support. Support for most opposition parties remained in the single digits for the entire duration of the Kishida administration, even as support for the LDP and Kishida fell precipitously. Overall, the opposition parties were fragmented and weak; limited gains in local elections reflected the unpopularity of the LDP rather than rising fortunes of the opposition parties. Ultimately, Kishida’s persistent low favorability was not the result of an alternate set of policies or ideologies brought by opposition parties. Kishida did not have to contend with the rise of far-right parties that have captured increasing proportions of the public and youth votes in many European countries, nor did he preside over a deeply divided electorate as in the United States.
Reform and Compromise
In recent history, the LDP’s most dramatic reformers have come to power when the party was threatened electorally by its opposition or when the party regained power after losing it. In 1996, Hashimoto Ryutaro embarked on a wide range of reforms that cut to the heart of Japan’s postwar economic model. Koizumi—a maverick who was selected by rank-and-file LDP members in 2001 after the disastrously low, single-digit approval ratings of his predecessor Mori Yoshiro—ended up saving the LDP by promising to destroy its old ways. After the LDP lost in 2009, Abe, Japan’s longest-serving prime minister, heralded the party’s return to power in 2012 with the slogan “Japan is Back,” trumpeting an ambitious reform package and the catchy promise of “Abenomics.”
Kishida, in contrast, was chosen to lead the LDP following a mild jump in its popularity after his unpopular predecessor, Suga, announced his resignation. Despite some reform initiative—such as an aggressive emissions reduction policy and the creation of the Digital Agency—Suga operated best behind the spotlight as Cabinet Secretary. He lacked the charisma to capture popular support and domestic news showed him seemingly unable to build rapport with world leaders. Suga’s announcement that he would resign led not only to an immediate uptick in the stock market but also a bounce in the LDP’s approval rate. This is likely why Kishida the compromiser—rather than reformer Kono Taro, who had enjoyed the highest public approval ratings among the LDP’s candidates for prime minister prior to Suga’s resignation—became prime minister. According to some political insiders, many regional LDP seats that had been threatened by falling approval rates were shored up when the LDP’s favorability rebounded, so local politicians shied away from any aggressive reform agenda that might endanger their seat.
This line of thinking suggests that the very nature of why and how the LDP chose Kishida led to his inability to present the strong vision or bold reforms the electorate wanted.
Looking Forward
Over time, Kishida’s legacy may improve from the low approval ratings that persisted through much of his tenure. His administration’s efforts to aggressively position Japan in the semiconductor supply chain were popular, and his unambiguous support for the startup ecosystem under his “Startup Development Five-Year Plan” remains relatively underappreciated (as the next installment of this series will show). Most critically, his contributions to Japan’s global standing do not seem to be appreciated by voters concerned with primarily domestic issues. Such is often the nature of foreign policy.
Looking forward, with most of the LDP’s factions dissolved and the party being less unpopular than the opposition parties, the dynamics at play are even more difficult to predict than usual. But the trajectory of Japan’s international economic and security policies are set to serve its interests well. The country’s next leader would be well served to follow Kishida’s legacy on the global stage while providing a stronger vision and strategy for reform and positive change at home.
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