Japan PM Ishiba Shigeru To Resign Amid Party Pressure Over Election Defeat: Report

(MENAFN- Live Mint) Japanese Prime Minister Ishiba Shigeru announced his decision to step down on Sunday, just over a month after his party suffered a major defeat in the upper house elections, according to NHK World, which first reported the development.

The setback in July dealt a significant blow to Ishiba's leadership, as his ruling coalition failed to secure a majority in the upper house of Japan's Parliament. This followed a similar loss in the lower house elections the previous year, further weakening his political standing.

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According to the Kyodo News, despite this major setback, which led to his ruling coalition losing its majority in both houses of Japan's parliament , Ishiba vowed that he would remain in office as the country's Prime Minister to avert a“political stalemate”.

Ishiba, who leads the Liberal Democratic Party (LDP), ruled out stepping down to 'avoid a political deadlock' and to maintain leadership during what he described as a“national crisis”, as households struggle with rising costs and due to looming US tariffs.

Despite acknowledging his“heavy responsibility” for the outcome, Ishiba had ruled out stepping down and stressed his commitment to the public.

In August, Ishiba reaffirmed his decision to remain in office despite growing pressure to resign, as the LDP convened a crucial meeting following its recent electoral setback in the Japanese Parliament, Kyodo News reported.

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Kyodo News reported that during a joint plenary session of LDP lawmakers from both houses of Japan's parliament, party leaders disclosed that the LDP's election committee is now considering holding an early leadership election, originally planned for 2027.

In an informal meeting held in July, the majority of participants reportedly urged Prime Minister Ishiba to take responsibility for the election loss and resign.

The ruling LDP-Komeito coalition saw its seats in the 248-member upper house drop from 141 to 122, losing its simple majority. While the upper house holds less power than the lower house, it remains essential for passing legislation.

What happens if Ishiba resigns?

While the resulting political uncertainty could further strain an economy already impacted by US tariffs, market attention is primarily on the possibility that Ishiba might be replaced by a proponent of looser fiscal and monetary policies, such as Sanae Takaichi, who has openly criticised the Bank of Japan's interest rate hikes, Reuters reported.

Ishiba narrowly defeated Takaichi in the LDP leadership run-off.

If Ishiba resigns, his last act as premier will have been to finalise details of a trade deal with the United States last week, under which Japan pledged $550 billion of investments in return for lower tariffs from US President Donald Trump on Japan's key autos sector, Reuters reported.

(With inputs from agencies)

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