On October 4, 2025, Japan’s ruling Liberal Democratic Party will elect a new party president, following Prime Minister Shigeru Ishiba’s decision earlier this month to step down.
While five LDP members have entered the race, the contest is effectively a battle between two key figures: Sanae Takaichi and Shinjiro Koizumi, who lead substantially in comparison to the others, according to recent polls.
Although they belong to the same party, the two candidates represent sharply contrasting visions for Japan’s future. One risks returning the country to the era of “revolving door” premierships that plagued earlier decades, while the other could push Japan into a deeper ideological confrontation and trigger a “race to the bottom” with the country’s rising alt-right movement.
The outcome of this leadership election will therefore shape not only the LDP’s future but also Japan’s political trajectory for years to come.
Polarizing Takaichi threatens to shift Japan farther right
A nationwide public opinion poll conducted by the Japanese newspaper Mainichi Shimbun on September 20-21 found that Takaichi was leading all candidates with 25% of the votes.
Takaichi is a well-known but highly controversial politician who has been a mainstay within the LDP for a number of years. Her status as an extreme right-wing individual, even within the LDP, and her associated policy stances raise concerns about the potential for heightened political and economic uncertainty.
The LDP’s declining fortunes in recent elections, particularly in the upper house, have partly been driven by voter defections from its conservative base to hard-right parties such as Sanseito. These voters, dissatisfied with what they see as the party’s abandonment of “conservative values” since the Abe era, have sought more uncompromising alternatives.
Many within the LDP believe that installing Takaichi as leader could win these voters back. Her controversial visits to the Yasukuni Shrine, which enshrines Japan’s war dead as well as Class-A war criminals, and her openly anti-foreigner rhetoric are in line with these disgruntled voters’ desires.
However, such notions operate under the potentially flawed assumption that Japanese voters are fickle and will easily forgive the LDP for its growing list of corruption scandals if Takaichi is elected. This assumption risks underestimating voters’ anger and overestimating their ideological loyalty.
In reality, Takaichi is more likely to find herself competing directly with Sanseito and opposition parties by amplifying their key messages, particularly those related to immigration and national identity.
We have already seen early signs that this is occurring, as evident in Takaichi’s remarks at press conferences on the campaign trail. During these sessions, Takaichi has taken a hawkish stance toward concerns about over-tourism by saying that “Japanese people are extremely tolerant, so everyone is swallowing their words” regardig foreign-related issues. Takaichi has promised to mitigate this threat by revising immigration policies “from scratch.”
However, if the LDP adopts policies that mirror those of Sanseito – centered on anti-immigration sentiment, populist rhetoric and anti-establishment posturing – it risks entering a downward spiral of seeing which party can be more extreme.
Sanseito is unlikely to relinquish its newly acquired electoral gains easily and will likely double down on its increased wage, anti-immigration and anti-establishment rhetoric. In turn, Takaichi, who has shown little hesitation in positioning herself as the party’s most hardline voice, could find herself continuously escalating her policy promises, in order to stay ahead of the far-right.
This tit-for-tat cycle threatens to undermine one of Takaichi’s central pledges to revitalize Japan’s economy. Takaichi is running on claims that she stands “here today to lead Japan back to the pinnacle of the world” and that “I will resolutely pursue economic growth.”
Takaichi has shown signs that her premiership will likely shift back to the Shinzo Abe-style policies of old, given her close relations with the former prime minister and his allies, such as former Prime Minister Fumio Kishida.
However, Abenomics’ success rests on the three arrows of 1) aggressive monetary policy, 2) flexible fiscal policy, and 3) structural reforms. Any hawkish immigration policies would be likely to impact its success negatively. In particular, the first and third arrows would be hindered by her heightened anti-immigration sentiment.
Abe’s third structural reform arrow aims to, among other things, boost labor force participation by creating jobs via infrastructure projects funded through the first arrow and encouraging underutilized sections of society to participate in the workforce. Yet Japan’s working-age population made up only 59% of Japan’s population in 2024, according to data released by the Ministry of Internal Affairs and Communications. This is far lower than the 65% Organisation for Economic Co-operation and Development (OECD) average.
As such, Tokyo would be unable to rely purely on the domestic workforce to staff these projects fully. Therefore, without immigration to supplement the labor force, Japan would struggle to execute large-scale projects or meet the demands of Takaichi’s structural reforms. The result could be stalled infrastructure plans, spiralling costs and delayed economic initiatives, all of which would weaken the effectiveness of Abenomics 2.0 at addressing Japan’s current economic concerns.
The scenario above could result in higher government spending and an even more burdensome debt-to-GDP ratio. It could threaten a deflationary spiral and stagnating wage growth. All that would feed into public frustration. Such frustrations would likely be particularly palpable among younger voters, who are already disillusioned with the LDP.
Therefore, far from stabilizing the party’s position, a Takaichi premiership could accelerate its decline and deepen the fragmentation of Japan’s political landscape.
Limited leadership experience could thwart Koizumi’s economic policies
A Koizumi premiership presents a different outlook. The 44-year-old, two-time cabinet minister is the son of a former prime minister and has been groomed his entire life for leadership. Despite his having failed in his previous attempt to become Japan’s prime minister, his renewed campaign has seen him secure a 21% approval rating during the aforementioned Mainichi Shimbun poll.
While Koizumi is also an advocate of reimplementing Abe-style economic policies, his more progressive view mitigates the economic uncertainty that a Takaichi premiership would present. In contrast to Takaichi, Koizumi has said that “Japan’s economy is in a transition phase from deflation to inflation” and that Tokyo’s economic policy should also reflect this change.
One of his key policy promises is to ensure that wage growth accelerates “at a pace exceeding inflation, so consumption becomes a drive of growth.” While Koizumi has not given overtly concrete details on how he plans to achieve this goal, some clues may be found in his foreign policy agenda.
Koizumi has distanced himself from more conservative LDP traditions, such as visiting the Yasukuni Shrine. This decision has kept the door open for him to advocate for the continuation of Tokyo’s current foreign policy stance on US-Japan relations and deepening economic cooperation with neighboring countries, such as South Korea.
In the case of South Korea, relations with Japan hit a tipping point in 2019 after South Korea initiated an informal trade ban on Japanese goods in response to disputes linked to Japanese colonial occupation of Korea. However, relations between the two countries have softened in recent years, opening the door for a more progressive Prime Minister Koizumi to initiate deeper economic cooperation with liberal South Korean President Lee Jae Myung.
The deepening of economic ties with countries such as South Korea would likely be in pursuit of his goal of enhancing Japan’s domestic supply and production capabilities, expanding exports of agricultural, forestry,and fisheries products and increasing security cooperation with like-minded countries.
Despite these ambitions, Koizumi’s political history and shortcomings present the risk he would become a lame duck prime minister, similar to Yoshihide Suga. Chief among these shortcomings is his relative inexperience and lack of political success in the cabinet positions he has held. Despite his being a two-time minister, his outspokenness has caused concerns amongst Japan’s business elites. More specifically, his comments about making the fight against climate change “cool” and “sexy” led Japan’s voters and businesses to believe he was still too inexperienced to take on important governmental roles.
As such, there is a heightened risk that both Koizumi’s lack of actual leadership experience and the perceptions surrounding him will limit his ability to implement his policies under a minority government. While Koizumi seems to aim to mitigate these concerns by calling for “broad policy discussions” with opposition parties, parties such as Sanseito are unlikely to heed his calls. Indeed, Koizumi’s status as a legacy politician runs counter to parties such as Sanseito’s anti-establishment messaging, limiting their willingness to engage in fruitful policy discussions.
Japan at a political crossroads
As the LDP prepares to choose its next leader, the contrast between Takaichi and Koizumi reflects a deeper crossroads for Japan’s political future. A Takaichi premiership risks dragging Japan into an escalating ideological contest that seeks short-term populist gains over long-term economic resilience and diplomatic stability. By contrast, a Koizumi-led government could sign a continuation of the status quo by taking a more moderate policy path, focusing on wage growth, foreign cooperation and the continuation of pragmatic economic policies.
Yet success via the Koizumi path is not guaranteed. His limited governing experience, occasional missteps, and reputation as a legacy politician risk undermining his authority among opposition parties.
Ultimately, the choice facing the LDP, and by extension Japan, is whether to pursue a politics of competition and confrontation under Takaichi or one of cooperation and renewal under Koizumi. The outcome will shape not only the party’s fortunes but also Japan’s role on the global stage, its ability to navigate demographic and economic challenges and the health of its democracy in the decades to come.
Hans Horan is a strategic analyst at the The Hague Centre for Strategic Studies.
