Today, Japan will choose its "next prime minister."

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Japan's ruling Liberal Democratic Party will hold a leadership election today to determine the party's new leader, and the winner will in effect become Japan's next prime minister.

According to CCTV News, a total of five candidates are competing in this LDP presidential election: Minister of Agriculture, Forestry and Fisheries Shinjiro Koizumi, former Minister for Economic Security Sanae Takaichi, Chief Cabinet Secretary Yoshimasa Hayashi, former Minister for Economic Security Takayuki Kobayashi, and former LDP Secretary-General Toshimitsu Motegi. A second round of voting may be needed; the results will be announced after 3 p.m. local time.

In the first round of voting, the five candidates will compete for more than 590 votes. Yoshimasa Hayashi, Shinjiro Koizumi, and Sanae Takaichi are in the lead, presenting a tripartite rivalry. If Shinjiro Koizumi wins, he will become the youngest Japanese prime minister since the end of World War II; if Sanae Takaichi wins, she will become Japan's first female prime minister.

The Japanese media generally predict that the most likely result of this election is a runoff between Koizumi and Takaichi. At that time, since Hayashi’s policy positions differ greatly from Takaichi’s, his supporters are more likely to back Koizumi, who also supports continuing the "Ishiba line", thus further expanding Koizumi’s advantage.

The new party leader will face the arduous task of revitalizing the ruling party and restoring public support. Since the LDP has lost its majority in both houses of parliament, the new leader will need to cooperate with opposition parties to pass legislation and budgets.

The winner also faces diplomatic challenges. According to media reports, President Trump is expected to visit Asia in the coming weeks and may meet with Japan’s new leader during his visit or at a multilateral conference.

Election System Favors Lawmakers' Opinions

According to media reports, the first round of voting will be open to the LDP’s 916,000 ordinary party members, who have 295 votes—equal to the number of LDP lawmakers’ votes. However, the second round of voting will favor lawmakers’ opinions, as lawmakers can vote again, while the 47 local branches have only one vote each.

In the survey among lawmakers, Shinjiro Koizumi leads, Yoshimasa Hayashi is in second place ahead of Sanae Takaichi. Hayashi will need a major breakthrough in local support to enter the second round.

Last year, Sanae Takaichi and Shinjiro Koizumi were also popular candidates, but Shigeru Ishiba took advantage of the political space between the two to achieve a surprise victory.

Major Policy Differences Among Leading Candidates

Shinjiro Koizumi has toned down his previous reform pledges, shifting toward more moderate, centrist policies. He promises to ensure a 1 million yen (US$6,800) pay raise by 2030, link the tax-free income threshold to inflation, abolish the gasoline tax, and revise income tax laws. He also plans to formulate an action plan on issues related to foreigners by the end of the year.

Sanae Takaichi supports fiscal expansion and right-leaning political positions and is seen as a protégé of the late Prime Minister Shinzo Abe.

She calls for maintaining an easy monetary policy and believes the Bank of Japan should not raise interest rates. These stances could lead to a weaker yen, a higher stock market, and higher ultra-long-term government bond yields.

Yoshimasa Hayashi, as the current government's chief spokesperson, is most aligned with the incumbent government’s positions. He has served as foreign minister and defense minister, promises to ensure wage increases outpace inflation, and has proposed introducing a UK-style universal credit system.

Diplomatic Challenges Loom

Besides livelihood issues, the new prime minister will soon face major diplomatic challenges after taking office.

According to media reports, President Trump will visit Asia in the coming weeks and may meet with Japan’s new leader during his visit or at a multilateral conference.

Currently, Japan has basically concluded trade agreement negotiations with the United States and guaranteed that automobile tariffs will be lowered to 15%. However, problems may still arise during the implementation of the US$550 billion investment fund, and Washington’s demands for defense spending by its allies may also become a focal point of discussion.

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