Shinzo Abe re-elected as Prime Minister of Japan; Modi, Obama congratulate on his third term victory

Narendra Modi and Shinzo Abe

Tokyo, Dec 15: Prime Minister Shinzo Abe-led ruling bloc won more than two-thirds of the 475-seat House of Representatives in Sunday’s snap election.

Shinzo Abe, who faces strong resistance to a promised economic and political overhaul, reportedly vowed on Monday to push up wages, making clear his intention to forge ahead with his economic policies.

The day after his decisive election victory and counter criticism that his measures have failed to benefit workers, Abe said at his first news conference: “We will hold a meeting with labor and business representatives tomorrow to ask for wage increases next year.”

“As I toured around the nation during the election, I heard the opinions of ordinary citizens who are suffering from price increases, and small-business owners in difficulties due to price hikes in raw materials,” Abe said, adding that he will draft an economic stimulus package by the end of the year.

Abe’s gamble to call a snap election after the world’s third largest economy entered a recession appears to have paid off.

In Sunday’s snap election, the conservative Liberal Democrats who have ruled for most of the post-World War II era locked up a solid majority of at least 291 seats.

About 35 seats were claimed by the LDP’s coalition partner, the Buddhist-backed Komei party, giving the ruling bloc more than two-thirds of the 475-seat House of Representatives.

That majority will enable the coalition to override resistance in the upper house, but not necessarily the powerful vested interests and bureaucrats opposed to major reforms many economists say are needed to revitalize Japan’s economy.

The solid majority for the ruling coalition does reduce the likelihood of challenges against Abe from within the Liberal Democratic Party. That could allow him to put off the next election until as late as December 2018.

The “Abenomics” blend of aggressive monetary easing, public spending and economic reforms has pushed share prices higher and weakened the value of the Japanese yen, helping big exporters like Toyota Motor Corp. But wages and business investment have remained sluggish, and inflation and growth have fallen short of the targets set by Abe when he took office two years ago.

A quarterly survey of business sentiment released on Monday by the Bank of Japan showed a slight deterioration in the outlook for coming months. Conducted after Abe delayed a sales tax hike that had been planned for next year but before Sunday’s election, it showed businesses anticipate slack demand and rising costs.

“Abenomics is still halfway through, and I feel a strong sense of responsibility to push it further,” said finance minister Taro Aso, who retained his seat in parliament.

The Liberal Democrats held 295 seats before the election, and fell short of forecasts that they could win as many as 320 seats.

The main opposition party, the Democratic Party of Japan, won 73 seats – a stronger showing than many had expected. But the party’s leader, Banri Kaeda, lost his seat and the party remains weak and in disarray after it lost power in 2012.

The Japan Communist Party, a traditional protest vote option, nearly tripled its seats to 21, while another opposition party, the Innovation Party, took 41 seats.

Obama, Modi congratulate Abe

Congratulating Shinzo Abe on being re-elected for a third term as the Prime Minister of Japan, President Obama said US-Japan alliance is the cornerstone of peace and prosperity in the Asia-Pacific region.

President Obama said: “On behalf of the President and people of the United States, we congratulate Prime Minister Abe on the Liberal Democratic Party’s success in the elections in Japan today.”

Prime Minister Narendra Modi also congratulated his counterpart Sinzo Abe on being re-elected for a third term as the Prime Minister of Japan and said he looks forward to continuing to work closely with him to strengthen the bilateral ties.

Modi tweeted: “Congratulations @AbeShinzo on your victory in the elections. Japan will scale newer heights of progress under your able leadership.”

(With Agency Inputs)

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