Takaiichi Pledges Fiscal Expansion to Make Japan the ‘Land of the Rising Sun’ Again

Sanae Takaiichi formally launched her bid on Friday to become Japan’s first female prime minister, vowing to revive the economy with a master plan centered on government spending and targeted tax relief aimed at doubling GDP within the next decade.

Following Prime Minister Shigeru Ishiba’s announcement that he will step down after the ruling Liberal Democratic Party’s (LDP) heavy defeat in July’s upper house election, Takaiichi and Agriculture Minister Shinjiro Koizumi are seen as the frontrunners in the leadership race.

Hailing from the LDP’s conservative wing, Takaiichi said at her campaign launch:
“I have never denied the importance of fiscal consolidation—it is certainly necessary. But what matters most is growth. I will make Japan once again a vibrant land of the rising sun.”

Her plan calls for state-backed initiatives in sectors such as artificial intelligence, semiconductors, and battery technology. She also promised measures to raise take-home pay, including tax credits, deductions for household services, and corporate breaks for companies that support childcare.

Positioning herself as both a reformer and a defender of traditional values, Takaiichi’s proposals mark a sharp break from Japan’s usual caution over public debt and could add strain to bond markets.

“Even within her own party, many will view this as fiscal irresponsibility,” said Jeffrey Hall, a lecturer at Kanda University of International Studies specializing in Japanese politics and society. “If she pursues this course, the impact on Japan’s economy could be immediate. It’s a risky strategy.”

In her wide-ranging speech, Takaiichi also pledged to restart nuclear power plants, establish a national intelligence agency, and create a new panel to screen foreign investment in sensitive industries. She called for a review of land purchases by foreigners and tighter controls on strategic assets.

A former minister for economic security and home affairs, she said she wants to strengthen Japan’s military, though she declined to specify what share of GDP she would allocate to defense spending. She also avoided clarifying whether she would continue visiting Tokyo’s controversial Yasukuni Shrine if elected and confirmed as prime minister. No Japanese leader has visited the shrine in nearly two decades to avoid angering China, South Korea, and other Asian neighbors who view it as a symbol of Japan’s wartime aggression.

Takaiichi added that, if elected, she would raise Japan’s global profile by traveling abroad at least once a month.