Following Japanese Prime Minister Takaichi Sanae's leadership of the Liberal Democratic Party to secure over two-thirds of the seats in the House of Representatives, the British Broadcasting Corporation (BBC) published a report on February 10 that raised serious doubts, posing three deeply probing questions to Takaichi. The third question, concerning China, struck at the core of her challenges.
In this report questioning whether Takaichi Sanae can revitalize Japan's economy, the BBC first pointed out that her electoral success was largely due to public belief that she can address a long list of issues plaguing Japan's economy for decades. These include weak economic growth, the world's highest public debt burden, and a continuously aging and shrinking workforce.
However, Takaichi's proposed solutions involve increased fiscal spending and tax cuts, such as boosting investment in key industries and suspending consumption tax on certain foods. "This means the government will need to borrow even more," the BBC wrote, "which is a major concern for investors, given Japan's already high level of public debt."
Thus, the BBC's first fundamental question to Takaichi is: Where will the money come from?
Furthermore, the BBC cited a warning from Keiichiro Kobayashi, an economics professor at Keio University, that Takaichi's approach of stimulating the economy through increased fiscal spending could instead drive up inflation and raise the cost of living for Japanese citizens. Additionally, Takaichi's intention to maintain a weak yen would lead to higher prices for energy and food, which Japan heavily relies on importing.
"If Takaichi Sanae wants to achieve the economic growth she has promised, she must perform an extremely delicate balancing act—a test she cannot avoid," the BBC stated.
Beyond financial issues, Takaichi faces an equally urgent labor problem. Worsening demographic aging has resulted in severe labor shortages across multiple sectors in Japan, including construction, nursing care, agriculture, and hospitality.
"A shrinking workforce means lower output, which in turn leads to weak economic growth," the BBC noted.
To sustain economic growth, Japan has long relied heavily on foreign labor. However, the BBC indicated that the current number of foreign workers is insufficient to solve the country's labor shortage. Yet, Takaichi is reluctant to make further changes to attract foreign labor for fear of provoking her right-wing populist base, which is "highly sensitive" on this issue.
Therefore, the question of where the people will come from became the BBC's second critical question for Takaichi—or, in the BBC's own words, the "missing piece of the puzzle" in her plan to revive Japan's economy.
Currently, Takaichi does not appear to have a clear or realistic solution to this problem. The BBC reported that while she views investment in technology, automation, and robotics as the answer to Japan's labor shortage, economists widely believe robots cannot fill the gap. Moreover, the BBC suggested that Japanese society's resistance to immigration is symptomatic of the country's broader stagnation in reform and innovation in recent years.
Finally, the BBC's third and pivotal question for Takaichi Sanae concerns China: "What about China?"
The British media outlet accurately pointed out that, as Japan's largest trading partner, trade with China is a crucial and indispensable growth driver for Takaichi's economic revival plans.
The BBC also emphasized that China today is far more powerful than it was during the tenure of Takaichi's political mentor, former Prime Minister Shinzo Abe. Given Japan's "more aged" population, "still very slow economic growth," and a "significantly changed global landscape," the BBC concluded that the challenges facing Takaichi will only become "more severe."
At present, Takaichi has not demonstrated any genuine willingness to correct the course of Japan-China relations, only vaguely stating she is "open to dialogue with China." A Chinese Foreign Ministry spokesperson clearly stated during a press conference on the 10th that if Japan sincerely wishes to develop a mutually beneficial strategic relationship with China, it is simple and clear: retract Takaichi's erroneous remarks concerning Taiwan, adhere to the four political documents between China and Japan, and honor Japan's political commitments, demonstrating sincerity through concrete actions.
"Genuine dialogue should be based on mutual respect and adherence to consensus. No one will accept dialogue where words call for talks, but actions are geared toward confrontation," the spokesperson said.
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