Japan’s Fumio Kishida to fire more officials in slush fund scandal: Report

Japanese Prime Minister Fumio Kishida is likely to replace up to 15 ministers and junior ministers as he tries to manage the repercussions from a slush fund scandal that threatens to bring down his government. According to a Bloomberg report, citing Japan’s Asahi newspaper, as suspicions grow that the group had routinely disguised campaign funding, all members of the Liberal Democratic Party faction led by the late Prime Minister Shinzo Abe are reportedly being removed from office. Kishida also intends to remove members of the Abe faction from high party positions, as reported over the weekend by the media. “I’ll take appropriate action at the appropriate time, to avoid delays to management of the government,” Bloomberg quoted Kishida told reporters Monday, declining to comment further on his plans. Prominent figures set to be removed in the impending shake-up include Trade Minister Yasutoshi Nishimura, a key player in Japan’s efforts to regain global prominence in chip manufacturing, and Chief Cabinet Secretary Hirokazu Matsuno, the government’s chief spokesperson. This restructuring is anticipated to take place after the conclusion of the parliamentary session on Wednesday. The effectiveness of such a significant crackdown in solidifying support for Prime Minister Kishida’s government remains uncertain. Kishida’s approval ratings, the lowest for a Japanese premier in over a decade in certain polls, may not necessarily stabilise even with this reshuffle. While a general election is not required until 2025, the Liberal Democratic Party (LDP) might consider replacing him when his term as party leader concludes in September or possibly earlier. A survey conducted by the Sankei newspaper and FNN news network over the weekend revealed a drop in support for Kishida’s cabinet by over five percentage points from the previous month, reaching a new low of 22.5% since he assumed office just over two years ago. Over 90% of respondents expressed concerns about funding suspicions, with a similar proportion advocating for Kishida’s replacement either when his term expires or sooner. The LDP, with its five major factions competing for government positions, is witnessing a strategy shift, with Kishida aiming to appoint lawmakers not affiliated with any faction to key roles, as reported by the Mainichi newspaper. The suspicion surrounding undeclared income from fundraising events held by the Abe faction, totaling approximately ¥10 million ($69,000) per person, has led to investigations involving multiple lawmakers, according to reports by the Asahi and other media outlets. The potential loss of influence for the conservative Abe faction, known for its adherence to ultra-easy monetary policies, could impact the yen’s value, potentially causing an upward shift, warned Takeshi Ishida, a currency strategist at Resona Bank. Overall administration instability could result in stock market declines and trigger risk aversion. Reports of the reshuffle emerged following a scandal that dominated government briefings and a parliamentary committee session on Friday. The opposition Constitutional Democratic Party is expected to submit a no-confidence motion against Matsuno to parliament as early as Monday, according to NHK. Previous scandals have already eroded Kishida’s support, with dissatisfied voters expressing concerns about his measures to shield them from the impact of inflation. Kishida’s policies, such as extending subsidies on gasoline and utilities until spring 2024 and implementing tax rebates for low-income households, have not garnered widespread approval. A November poll by the Mainichi newspaper revealed that support for Kishida’s cabinet had plummeted to 21%, marking the lowest approval rating for a Japanese premier since 2011. Recent economic data, released on December 8, indicated Japan’s sharpest economic contraction since the height of the pandemic in the three months through September, providing little incentive for voters to rally behind Kishida, who assumed office just over two years ago. With inputs from agencies