Tidying up the US on the trade deficit will prove to be Shinzo Abe's first major challenge when it is renewed

Tidying up the US on the trade deficit will prove to be Shinzo Abe's first major challenge when it is renewed

by
Corey Wallace

This week, Shinzo Abe and Shigeru Ishiba face the presidency of the Liberal Democratic Party and the Prime Minister of Japan. Polls indicate that Abe will declare victory in the first round with a majority of LDP members and LDP parliamentarians.

On Thursday's win, he faces tough international and internal tests. The concern of US President Donald Trump over the US trade deficit of $ 69 billion against Japan will be his biggest challenge. Abe hopes to avoid tariffs on Japanese vehicles while resisting a bilateral trade agreement on Trump's resistance. So far, two tactics have to be emphasized: weapons and energy purchases.

Japan has announced plans to buy the Aegis Ashore missile defense system ($ 5.4 billion) and is expected to add nine more E-2D Hawkeye early warning systems ($ 3.14 billion) to an initial purchase of four units. Tokyo currently has nearly $ 20 billion in foreign military sales with the US.

Tokyo has also been working to increase Japan's purchases of US LNG. And it supports the resale of US gas to Asian countries as another measure to reduce the deficit. Japanese infrastructure and energy companies, together with government-backed agencies, are already promoting regional construction of power generation plants and LNG terminals, as well as marine insurance companies, to support Japan's future US natural gas sales.

Entente with China

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The Japanese uncertainty of appeasing Trump will still motivate Abe to promote Japan's tactical agreement with China. Chinese President Xi Jinping and Abe are now thrilled to push the ASEAN-centered regional comprehensive economic partnership to diversify economic options for both nations. With the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership and the Economic Partnership Agreement between the EU and Japan already in Japan's hands, this moment offers a good opportunity for China to encourage China to agree to a "higher-level" RCEP agreement, while it gains further leverage to withstand US trade demands.

In the light of recent implementation and messaging issues, China could also take advantage of the practical experience and image enhancement that would accompany working with Japan on its Belt and Road initiative. While Japan's own international connectivity agenda is often portrayed as a BRI rival, Sino-Japanese cooperation in overlapping geographic and sectoral areas of economic interest could commercialize Japan commercially. Not surprisingly, Tokyo and Beijing sign letters of intent for 20-30 projects in October. Mutual guides are also likely to visit over the next year.

security tensions

As security tensions widen, China-Japan rapprochement could ease pressure on Japan should Trump escalate the trade dispute, especially if it begins to link trade with the Security Alliance. Japanese officials have warned that, in contrast to steel tariffs, they would take revenge if the US applied tariffs on Japan's vehicle exports.

Domestically, Abe's attention is focused on a targeted overhaul of the social security system in Japan and increased labor force participation. It seeks to help older children, through increased pre-school funding, to help young workers return to work, increase the number of foreign workers and extend the longevity of the current workforce through optional pension delays. Abe believes that such measures will lead to higher tax revenues and higher social security revenues, while the proposed tertiary support – a large future burden that is beyond the heads of Japanese parents – is likely to boost private consumption.

But the 2019 High House election could complicate the implementation of its domestic agenda as well as the constitutional revision of the war-wrenching Article 9.

The vast majority of seats available for election in 2019 were won by the LDP in mid-2013, when Abe was at the height of popularity, the opposition was in absolute disarray and the public wanted to end the "twisted-country" scenario between politics In 2007 and 2012. But with Abe's declining popularity over time, and with improved opposition election coordination, the LDP won no majority of the seats contested in the 2016 House of Lore vote.

Unlikely to drive Abe

A repeat of 2016 will result in the LDP losing seats and its majority in the House of Lords and possibly strengthening Komeito's hand in the coalition. While it is unlikely that Abe will be ousted by the lead before the 2020 Tokyo Olympics, worse than expected performance may limit his ability to play a major role in choosing his successor.

Constitutional change forces are also likely to lose the two-thirds majority needed to pass a resolution resolution by the House of Lords before a constitutional referendum. This may explain Abe's desire to adopt an amendment during the extraordinary diet meeting in spring 2018, but Komeito currently appears to be busy counting down to the 2019 election on Abe.

It could also have negative consequences for the Conservatives in Japan, who voted No at a constitutional referendum, including Abe's resignation. Controversy surrounding the revision of Article 9 may also complicate the more urgent objective of completing Japan's defense capabilities following the revision of the National Defense Program guidelines expected by the end of 2018.

With many others on his plate over the next year, Abe could eventually be forced to pass constitutional revision.

Corey Wallace is the Einstein Postdoctoral Fellow at the Graduate School of East Asian Studies, Freie Universität Berlin. This article is part of a series of East Asia Forum (www, Eastasiaforum.org) in the Crawford School of Public Policy at the Australian National University.

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