Key conference of Japan's Liberal Democratic Party, Shigeru Ishiba "on the verge of collapse," deputy "resigns to take responsibility," yen falls in response

Several senior officials of Japan's ruling Liberal Democratic Party (LDP) announced their intention to resign on Tuesday, triggering political turmoil, with the US dollar rising 1% against the yen to 148.65. LDP Secretary-General Hiroshi Moriyama was the first to announce his resignation, followed by Policy Research Council Chairman Itsunori Onodera and General Affairs Chairman Toshikazu Suzuki.

According to media reports on Tuesday, Hiroshi Moriyama, a key ally of Prime Minister Shigeru Ishiba and LDP Secretary-General, stated he would take responsibility for the defeat in the July Upper House (Senate) elections, which resulted in the ruling coalition losing control of the Upper House.

Following the announcement of these resignations, the yen further weakened against the dollar. Moriyama's departure will be a significant blow to Ishiba, who is trying to balance internal dissatisfaction within the party and a rebound in public support.

On Tuesday, the LDP completed its analysis report on the reasons for the election defeat, attributing the loss to factors such as the lack of attractive inflation countermeasures, political scandals, and failure to attract young voters, without naming Ishiba. According to media polls, 128 out of 342 LDP lawmakers and local branch representatives support holding an early party leader election.

According to party rules, if more than half of the lawmakers and local representatives submit a written request, the LDP must hold an early leadership election. Local media reported that a related decision could be made as early as next Monday.

Departure of Key Allies Intensifies Political Dilemma

After the LDP's general meeting on Tuesday, Moriyama stated that he intends to resign to take responsibility for the electoral defeat but left the final decision to Ishiba. The meeting discussed the issues encountered in the July elections.

In response to Moriyama's departure, Ishiba stated that he would make a decision regarding his responsibilities at the appropriate time, suggesting he is considering resigning but did not specify a timeline. Ishiba said that if the timing is right, it would be better for the public to act sooner rather than later. He also mentioned that he has a responsibility to take necessary measures to address remaining issues, including implementing economic policies related to tariffs.

As an important ally of Ishiba, Moriyama's intention to resign poses a significant blow to the Prime Minister. Ishiba is currently trying to maintain party unity amid some members' frustrations with his leadership, while his public approval ratings are rising.

In his speech on Tuesday, Ishiba apologized for the LDP's loss of numerous seats in the July elections, stating he has no intention of clinging to power but emphasized the need to advance economic policies and connect with the public.

Election Defeat Report Released, Ishiba Not Named

On Tuesday, the LDP finalized its analysis report on the reasons for the Upper House election defeat. According to a copy of the report seen by the media, the LDP attributed the loss to the party organization itself but did not single out Ishiba as a factor in the defeat.

The report mentioned reasons for the defeat, including the lack of attractive inflation countermeasures, previous political scandals, and failure to attract young voters. This report may influence some political figures' decisions on whether to continue supporting Ishiba's government or call for an early leadership election before his term ends in 2027 Agriculture Minister Koizumi Shinjiro stated during a live television broadcast on Monday that he would "consider how to act after carefully reviewing the results of the examination." Koizumi Shinjiro is seen as a potential candidate for future Prime Minister.

The threshold for an early leadership change remains uncertain, public support becomes a bargaining chip for Ishinomiya Shigeru's retention

A poll released by the media on Sunday, targeting Liberal Democratic Party (LDP) lawmakers and local representatives, showed that out of 342 people, 128 supported holding an early party leader election, while 33 explicitly opposed it. About half of the respondents had not yet decided on their voting choices, making it unclear whether the LDP would push for an early leadership election.

Some political figures have already expressed clear support for an early election. Current Deputy Minister of Finance and LDP lawmaker Saito Hiroaki wrote on social media platform X on Sunday, "If I am asked to resign from my deputy minister position because I support holding an early leadership election, I will comply."

Despite dissatisfaction within the LDP regarding Ishinomiya Shigeru, he still enjoys a certain level of support from the broader public, with recent polls indicating an increase in his approval ratings.

In late August, Ishinomiya Shigeru's approval rating in the Kyodo News poll rose by 12.5 percentage points from the previous month to 35.4%, while media surveys showed an increase of 17 percentage points to 39%, and another poll indicated a 4 percentage point rise to 33%.

The Kyodo News poll also revealed that the proportion of respondents who believe Ishinomiya Shigeru should resign decreased by 11.6 percentage points, with 57.5% believing he should continue in office, while 40% thought he should step down.

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