-
- PM Takaichi Enjoys Honeymoon Period As The First Female Prime Minister
Persuading the Japan Innovation Party and successfully inviting them into coalition, the Sanae Takaichi (President of the Liberal Democratic Party) was selected as the 104th Prime Minister last week in the extraordinary Diet session with the support of the Japan Innovation Party. She immediately formed her Cabinet.
In the LDP leadership election, her rivals — Shinjirō Koizumi was appointed Defense Minister, Yoshimasa Hayashi was appointed Minister of Internal Affairs and Communications, and Toshimitsu Motegi was appointed Foreign Minister — putting major figures in key ministerial posts.
Takayuki Kobayashi was made Chair of the LDP Policy Research Council, creating a united party posture after the fierce contest.
The Takaichi Cabinet appears to be entering a honeymoon period, having achieved a high approval rating of 74% in a Nikkei‐poll.
Especially in foreign affairs, Prime Minister Takaichi has delivered beyond expectations, so the honeymoon period is expected to last for some time.
However, whereas during the late Shinzo Abe era the LDP held a large majority in the Diet during his more than 8-year tenure, the current LDP is a minority government and even when adding the Japan Innovation Party’s seats, it does not reach a majority.
For each policy the government must seek agreement with other opposition parties as well, meaning the Takaichi Cabinet’s foundation is extremely fragile.
Among the 12 policies of the Japan Innovation Party agreed when bringing them into the coalition, especially reducing the number of Diet members, the Osaka “Vice-Capital” plan, and the abolition of corporate political donations, the de facto hurdle to realising them within the year is very high.
If delivery of these agreements is delayed, dissatisfaction in the Japan Innovation Party may build and the possibility of exiting the coalition may arise.
It is therefore conceivable that the Takaichi Cabinet may dissolve the House of Representatives and call a general election while the approval rating is high and before public trust is lost, in order for LDP to gain a single majority.
2. Takaichi And Her Cabinet Successfully Welcomed President Trump And His Team In Japan
U.S. President Donald Trump visited Japan from October 27 to 29.
On the 27th, he met with His Majesty the Emperor; on the 28th, he held a summit meeting, visited the U.S. Navy base in Yokosuka, and in the evening attended a dinner meeting with companies planning massive investments in the United States.
The main focus of attention was the chemistry between President Trump and Prime Minister Takaichi.
Inheriting the DNA of the late former Prime Minister Abe—who enjoyed a close relationship with “Trump 1.0”—Prime Minister Takaichi naturally presented herself as his legitimate successor, an identity recognized by both herself and others, in her interactions with President Trump.
Although the media’s access was limited, judging from their expressions and behavior, it can be said that the chemistry between President Trump and Prime Minister Takaichi was quite strong.
After their talks, the two leaders signed an agreement on tariff measures and another on strengthening the supply chains of critical minerals such as rare earths.
In conjunction with the summit, ministers from both sides also signed memoranda confirming cooperation in advanced technologies such as artificial intelligence (AI) and in the shipbuilding sector.
3. Japan To Invest In Energy, AI And Critical Mineral Projects In The U.S.
On the 28th, the Japanese and U.S. governments announced a joint fact sheet summarizing the candidate companies and project details related to the $550 billion (approximately ¥84 trillion) in U.S.-bound investments promised under the Japan–U.S. tariff agreement reached in July.
More than ten major Japanese corporations, including Mitsubishi Heavy Industries and Toshiba, were listed as participants, with a total of over $390 billion (approximately ¥60 trillion) in projects covering areas such as energy and artificial intelligence (AI).
The Japanese side will begin full-fledged consideration for the early implementation of these investments.
According to the fact sheet, a total of 21 projects were outlined in four main fields:
l Energy
l Power generation development for AI applications
l Enhancement of AI infrastructure
l Critical minerals
Energy accounted for eight projects—the largest share—reflecting the strong interest on the U.S. side.
Major projects include a plan by Westinghouse Electric Co., a U.S. nuclear power manufacturer, to construct small modular reactors (SMRs), one type of next-generation nuclear reactor, with an overall project cost of up to $100 billion.
Japanese firms such as Mitsubishi Heavy Industries and Toshiba are considering participation.
In the AI sector, Mitsubishi Electric plans to provide power generation systems for data centers, while Hitachi, Ltd. is expected to supply power infrastructure for data centers.
Regarding critical minerals, Japanese companies are considering involvement in the construction of a copper refining facility by a U.S. firm.
Under the Japan–U.S. agreement, Japan pledged to expand investment in the United States, as well as purchases of energy and agricultural products, in exchange for U.S. tariff reductions.
The investment framework stipulates that projects approved by President Trump will receive funding, loans, or loan guarantees from institutions such as the Japan Bank for International Cooperation (JBIC), and that the investments will be carried out by January 19, 2029, the end of President Trump’s current term.
- Japan’s Shipbuilding Industry Accelerates Investment to Regain Global Competitiveness
Yukito Higaki, chairman of the Japan Shipbuilders’ Association and president of Imabari Shipbuilding, announced at a related Liberal Democratic Party (LDP) meeting on the 23rd that the private sector plans to invest 350 billion yen by 2035, while also calling for substantial government support.
Prime Minister Takaichi has indicated her intention to strengthen assistance from the perspective of economic security.
However, Japan still lags far behind its Chinese and South Korean rivals in the global market, underscoring the need for a united effort between the public and private sectors.
The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has set a goal of doubling Japan’s annual shipbuilding volume to about 18 million gross tons by 2035, roughly twice the current level.
The industry’s announced investment aligns with this government plan.
Achieving it is estimated to require over one trillion yen in total investment, with the private sector expected to shoulder about 30%.
In accordance with Prime Minister Takaichi’s economic policy directives, the party aims to flesh out specific support measures for shipbuilders.
Behind this large-scale investment drive lies growing concern over the dominance of Chinese and South Korean shipbuilders in the global market.
Although 99% of Japan’s trade depends on maritime transport, the country’s share of global shipbuilding—which stood at around 40% in 1994, the world’s largest at the time—has fallen to about 10% as of 2024 (preliminary data).
Meanwhile, China and South Korea have surged ahead. Through government-led restructuring and subsidy programs, their manufacturers have grown rapidly.
As of 2024, China commands about 50% of global shipbuilding output, and South Korea about 30%, leaving Japan far behind.
In contrast, Japanese shipbuilders have focused primarily on updating aging facilities in recent years.
To double construction output, productivity improvements are essential.
The industry plans to invest in new equipment such as large cranes and robots to shorten construction times.
However, since large cranes take roughly seven years to deliver, expectations for a government-backed fund to create a stable investment environment are high.
Progress on decarbonization will also be crucial to Japan’s comeback.
The International Maritime Organization (IMO) aims to reduce greenhouse gas emissions from international shipping to net zero by around 2050.
Japan is said to lead the world in developing hydrogen- and ammonia-fueled engines, and accelerating public- and private-sector investment will be vital to build the next generation of eco-friendly vessels.
Shipbuilding is also one of the fields of cooperation agreed upon under the Japan–U.S. trade negotiations, making the strengthening of Japan’s domestic foundation an urgent task.