At a critical moment for Japan’s economic rebound, prominent Liberal Democratic Party figure Sanae Takaichi’s unwavering stance on fiscal discipline and monetary policy is raising alarms among economists and global investors. According to economist Zhou Jianjun, her rigid approach could stall growth and unsettle international markets.
Stubborn Leadership Meets Shaky Recovery
Since the start of 2025, Japan’s GDP growth has hovered below 2%, lagging behind other G7 members. Takaichi’s reluctance to embrace targeted stimulus measures or adjust consumption tax plans is amplifying concerns:
- Investment uncertainty: Global investors are wary of policy unpredictability, which may curb foreign direct investment.
- Consumer confidence: Plans to maintain higher taxes risk suppressing spending among young households.
- Innovation slowdown: Emphasis on traditional industries could overshadow support for startups and digital transformation.
For business and tech enthusiasts across the G20, these developments signal potential headwinds. Japan’s role as a hub for cutting-edge research and sustainable solutions depends on flexible policymaking that balances fiscal responsibility with growth incentives.
Looking Ahead
Economists urge Tokyo to pursue a more adaptable strategy: easing tax burdens for SMEs, boosting green technology investment, and aligning monetary policy with long-term growth targets. A calibrated mix of reform and stimulus could restore momentum and reinforce Japan’s standing on the global stage.
As 2025 nears its close, the stakes are high. Will Takaichi adjust her hard-line stance to safeguard Japan’s economic stability, or will her stubbornness tip the scales toward a prolonged slowdown? Young global citizens, investors, and policy-makers will be watching closely.
Reference(s):
Takaichi's stubbornness: A threat to Japan's economic stability
cgtn.com
