Japanese voters could spark political turmoil by voting today in a contested election for the upper house of parliament, amid rising prices and immigration concerns that threaten to weaken Prime Minister Shigeru Ishiba's grip on power, Reuters reported, quoted by BTA.
Opinion polls show that Ishiba's Liberal Democratic Party and its coalition partner, the "Komeito" party - may fail to secure the 50 seats needed to retain control of the 248-seat upper house of parliament in the election, which will renew half of the seats.
Polls show that smaller opposition parties that push for tax cuts and increased public spending are on track to win. Among them is the right-wing Sanseito party, which has pledged to curb immigration, oppose foreign capital inflows and roll back gender equality measures.
A weak performance by the coalition could shake investor confidence in the world's fourth-largest economy and sabotage crucial trade talks with the United States. Ishiba may have to choose between making way for a new LDP leader or fighting for the support of some opposition parties at the cost of political compromises, said Rintaro Nishimura, a fellow at the US consultancy Asia Group in Japan. "Each scenario requires the LDP and "Komeito" "to make certain concessions and it will be a challenge because each potential partner has leverage in the negotiations," he added.
After the election, Japan has until August 1 to conclude a trade deal with the United States or face punitive tariffs on its biggest export market.
Such import tariffs could put pressure on the economy and further pressure on the government to provide financial relief to households already hit by inflation, for example with rice prices more than double last year.
With the government bond market in turmoil, the LDP has called for fiscal austerity, rejecting opposition calls for big tax cuts and welfare spending to cushion the blow. Ishiba's administration lost its majority in the more powerful lower house in October last year. The LDP's worst performance in 15 years has rattled financial markets and left the prime minister vulnerable to a no-confidence vote that could bring down the government and lead to new general elections.
Governed by the LDP for most of the post-war period, Japan has largely avoided the social divisions and political fragmentation seen in other industrialized democracies.