Japanese Prime Minister Shinzo Abe was re-elected as the leader of the ruling Liberal Democratic Party. That was a landslide victory as Abe won 553 votes out of 807. He is now set to become the longer serving PM in Japan. Abe said in a victory speech that “it’s time to tackle a constitutional revision,” and “let’s work together to make a new Japan.”
On the political side, Abe would seek to amend the constitution to confirm the legality of the country’s self-defence forces. The current article 9 of the constitution was written by the US after the second world war, forbidding Japan to use forces to settle international disputes. But under regional pressure, Abe would likely retain passages that forbid Japan from war of aggression. But one way or the other, such change would be a huge test in relationship with its neighbor South Korea and China.
On the economic front, Abe would continue with the three arrows of his Abenomics, ultra loose monetary policy, fiscal spending and structural reform. The next for Abe is social security reforms including raising retirement age above 65 and defer pension payouts beyond 70. The planned sales tax high from 8% to 10% will be carried out in October 2019.
On monetary policy Abe hailed that “the biggest goal of our macroeconomic policy has been fulfilled as a result of measures taken by the government and the BOJ to achieve 2 percent inflation”.
