Takaichi Holds Press Conference as Second Reshuffled Cabinet Takes Office
Overview
Following the launch of the Second Takaichi Reshuffled Cabinet, Prime Minister Takaichi outlined a policy of “responsible proactive fiscal policy,” using the Japan Growth Strategy and Regional Future Strategy to stimulate domestic investment and balance growth with fiscal sustainability. In appointing ministers, she prioritized expertise, awareness of issues, initiative, and execution, and retained ministers in roles where continuity was important. At the press conference, she described plans for regulatory reform, AI and digital reform, diplomacy and defense, economic security, disaster prevention, GX, recovery and reconstruction from the Kumamoto earthquake, and agricultural policy. She also answered questions about bills related to consumption tax, reducing the number of Diet members, monetary policy, and rice stockpiles.
Key points
- The reshuffled Cabinet said it would pursue “responsible proactive fiscal policy” and enter the full-scale implementation phase for its policies.
- In making appointments, the government prioritized expertise, awareness of issues, initiative and passion, and execution, and retained ministers in roles where continuity was important.
- The government set out plans to advance policies on growth strategy, AI and digital reform, GX, economic security, diplomacy and defense, disaster prevention, reconstruction, and agriculture.
- In the question-and-answer session, the government explained its responses on bills related to consumption tax, reducing the number of Diet members, diplomacy, monetary policy, recovery and reconstruction from the Kumamoto earthquake, and rice stockpiles.
Overview
Prime Minister Takaichi said the Second Takaichi Reshuffled Cabinet had taken office and would pursue the coalition government's policy pledges as a coalition of the Liberal Democratic Party and the Japan Innovation Party. She outlined a plan to encourage domestic investment through the Japan Growth Strategy and Regional Future Strategy and raise the potential growth rate.
For appointments, she reviewed survey responses from Liberal Democratic Party members and considered expertise, awareness of issues, and willingness to propose policies. Ministers in roles requiring continuity, including diplomacy and trade and economic and fiscal policy, were retained, and their portfolios were also reviewed. The Prime Minister said she had given no consideration at all to balancing former factions.
Impact
The Prime Minister described a virtuous cycle in which domestic investment leads to more jobs and higher incomes, improved consumer sentiment, increased business earnings, and naturally higher tax revenues. She said growth would preserve fiscal sustainability and generate funding for social security for all generations.
She explained that reviewing regulations and systems would encourage private investment and technological innovation, while putting AI into practical use would promote its adoption in labor-shortage sectors and small and medium-sized businesses. The government also planned to strengthen growth through GX by generating domestic investment and demand.
The Cabinet set the goal of creating a country where economic activity reaches every corner of the Japanese archipelago and people today and in the future can live safely and with peace of mind.
Details
Portfolios were established for regulatory reform, AI and digital reform, artificial intelligence strategy, content strategy, AX social implementation, international disaster prevention cooperation, and measures against bear damage. More than 50 industrial cluster plans under the Regional Future Strategy have been formulated and published, and several hundred more plans are being developed.
In diplomacy, the government will advance a Free and Open Indo-Pacific and promote initiatives such as “Power Asia.” It will review the three defense documents within the year and pursue economic security policies, including establishing data sovereignty. Takaichi said Japan would comprehensively advance a mutually beneficial strategic relationship with China and continue to urge the United States regarding the ICC.
For the Kumamoto earthquake, the government established the Emergency Disaster Recovery and Reconstruction Headquarters on September 1. It will check progress on the livelihood and business support package decided on August 27 and support Kumamoto Prefecture in developing a recovery and reconstruction plan. It will consider financial measures for a reconstruction fund after hearing the views of the prefecture, cities, towns, and villages.
Under GX, the government will diversify procurement of crude oil and naphtha, strengthen supply systems for petroleum-related products, use nuclear power on the condition of safety, and advance perovskite solar cells, next-generation geothermal power, and fossil fuel alternatives. It plans to compile the Power GX Strategy by year-end.
Bills to lower the consumption tax rate and provide grants to reduce the burden on employed people will be prepared based on the outline approved by the Cabinet on September 15, and deliberations will respect the views of each party. The bill to reduce the number of Diet members is expected to be discussed at the extraordinary Diet session; the government will monitor deliberations without commenting on when it might pass. Fiscal management will be explained to markets transparently, while specific monetary policy methods will be left to the Bank of Japan. For rice, the government will restore stockpile levels, diversify export destinations, and improve productivity through concentrated measures for structural transformation in agriculture.