Elections 2024: What will Japanese Prime Minister Ishiba Shigeru do after the ruling coalition lost its majority in Sunday’s elections, and how will the results affect Japan’s economy?

Prime Minister Ishiba Shigeru said he would consider the election a victory if the Liberal Democratic Party and coalition partner Komeito win a majority of at least 233 seats. But the bloc did not succeed: the LDP won 191 votes, and Komeito – 24.

Turnout in Sunday’s elections for the lower house of parliament was 53.85 percent, down 2.08 points from the previous election three years ago and the third lowest in the post-war period.

Below we look at Ishiba’s reaction to the election results and the reaction of the business community.

Ishiba: “I humbly and solemnly accept this result.”

Ishiba says his party’s coalition will aim to stay in power despite the crushing blow in lower house elections.

At a press conference this afternoon he said: “We have received exceptionally strong condemnation from the public. It is deeply regrettable that our LDP, together with our coalition partner Komeito, has lost many valuable members. We must humbly and solemnly accept this result. reflect sincerely and work towards a complete renewal of our party.”

Ishiba has vowed to carry out major reforms to regain public trust. He also said he would try to work with other parties in the House of Representatives. He said: “At this stage we are not thinking about immediately forming a new coalition. I think we need to start by discussing how to modestly present each party’s policies. In the process, we will work to build relationships of trust with other parties so that people trust that we are working together for their sake. This is a responsibility that we have to fulfill as the party with the most votes.”

However, the CDP, the largest opposition party, is also reaching out to other camps to oppose the coalition. Parliament will hold elections to appoint a prime minister in the coming weeks.

Yen slides

The Japanese yen weakened against the dollar in morning trade on Monday after the ruling coalition lost its majority in Sunday’s general election. Investors sold the yen on the belief that political uncertainty could slow the Bank of Japan’s interest rate hikes.

The currency hovered at a high of 153 yen against the dollar on the Tokyo foreign exchange market.

Market analysts said uncertainty about the composition and policies of the next government could hamper the Bank of Japan’s efforts to raise interest rates.

Tokyo Stock Exchange indices rose

But the yen’s fall has encouraged stock investors.

The Nikkei Stock Average opened lower on Monday, reflecting views that the government’s management and economic policies are difficult to predict.

The Tokyo Stock Exchange’s Nikkei Average erased early losses and gained 700 points (about 1.9 percent) in one leg. Investors bought shares of export-related companies that could benefit from a weaker yen. By the end of the morning session, the Nikkei reached 38,463.5, up 549.58 points from Friday. It closed at 38,605 on Monday, up 1.8 percent.

The Nikkei Average fell on the Tokyo Stock Exchange last week ahead of Election Day, with Friday’s closing price falling below 38,000 yen.

Sources said the decline was limited as the stock market expected the coalition to lose its majority. They added that investors are aware of the possibility of aggressive fiscal spending in response to the election results and that a falling yen is leading to higher stock prices.

Keidanren chief urges political parties to focus on growth policies

The chairman of the Japan Business Federation (Keidanren) called on the country’s political parties to focus on policies aimed at growing the economy and overcoming current problems.

Tokura Masakazu issued his statement after the ruling coalition lost its majority on Sunday.

Tokura said voters had shown their dissatisfaction with the LDP following the slush fund scandal, and added that the party must wholeheartedly accept the result.

He also said that the LDP and Komeito should help ensure the continuation of stable policies to manage the economy, as outlined below:

Japan Corporate Executives Association Chairman Niinami Takeshi released a statement saying: “It is difficult to say that there has been sufficient discussion on many important issues, and it should be said that the issues have been put on hold. “

He added: “I hope that both the ruling and opposition parties will face reality and have thorough discussions to advance the necessary policies.”

Japan Chamber of Commerce and Industry head Kobayashi Ken also commented on the situation, saying: “Efforts to strengthen small and medium-sized companies and revitalize the regional economy, which is facing a sharp decline in population, are two pillars of growth.”

He continued: “I hope the ruling party will work to create and implement a new growth strategy.”