Tokyo’s Governor Koike is putting up a serious challenge

According to the Japanese press anyway…

It is confirmed then, PM Abe dissolved the Lower House this morning.

Where it was a done thing, Abe to be re-elected and enjoy free entry tickets to the 2019 Rugby World Cup and 2020 Olympics as Prime Minister, the Japanese press is now making a bigger deal out of the challenge that a “unified” opposition front, led by Yuriko Koike and her newly founded Kibou no To, Party of Hope, are trying to assemble.DPJ leaders Maehara, with the support of Rengo,the Japanese Trade Union Confederation(and DP’s biggest support) and Liberal Party dinosaur Osawa have been meeting with Koike and trying to find a common ground for an assault on Abe’s fort. For facts and figures about how/when the elections will be run, you will find this article in the Nikkei most useful.

Here are my 2 bucks on the affair:

  • It’s all nice and well for the opposition to unite for the better of the Nation, but this unification is done just because each one of them playing solo would stand no chance of winning .
  • The good thing is Koike won the Tokyo governor post in July with an overwhelming majority and it seems the “olive tree” alliance as they call themselves, want to use Koike as the face for a New Japan.
  • With Maehara and Osawa, she finds a broader Japanese base, compared to her Tokyo only approach with her previous party “Tomin First no Kai “(Tokyoites first group).
  • BUT Koike is pushing her own candidates forward and Maehara and Osawa seem to be running themselves independently, how will they unite inside the Kibou no To?
  • The pre-electoral programs of each of the 3 opposition leaders find very little common ground.On taxes,nuclear, law reforms, immigration to start with.
  • The opposition parties DP and LP have been blown to pieces internally since they lost the 2012 elections.
  • Will the Japanese be willing to vote a woman into the hot seat? That would be such a major change in a still very much macho driven society, despite the efforts of raising the women’s status in the labour force.Rural Japan has little connections with this part of the notional policy.
  • Abe’s arrows have been missing their targets, especially the ones directed at improving the street economy.
  • Abe’s popularity ratings have been yo-yoing since he became PM, the Japanese citizens are constantly tangled up between hope and doubts.
  • BUT Abe still has the support of the big Japanese companies and New Komeito behind him. Traditions are hard to get rid of, especially in that part of the world.
  • Abe will have the International support, especially in these geo-politically uncertain times.The opposition has been very low key towards the outside, apart from a few shouts at the military legislation changes and the usual criticizing sessions in the Diet.
  • Abe has a very experienced crew of heavyweight politicians and all rounders to support him.
  • Is Japan really ready to open to positive immigration,when looking what’s happening around the world?
  • Corporate Japan has given signs of finally starting to raise wages.Question is how much but signs are there.
  • Timing is very short for the opposition to rally the masses behind them, smart move from Abe.

Conclusion, mine anyways;

I can see a bigger challenge coming than previously expected, the opposition is making an effort for sure. But, I reckon it will be a case of Abe not losing enough support to drive him out of the
hot seat. My view is we will see the same faces opening the 2019/2020 sports events. And we will see the same BOJ, MOF crew remaining in place too,which means we’ll continue with the same policies in place for a while. If I’m wrong, prepare for a big swing in the JPY upwards in the first days of a major election upset. I’d look to buy some downside JPY pairs protection just to be safe in the event of such a shock.

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