Tokyo, August 31: Japan’s next leader, Yukio Hatoyama, began talks on Monday on forming a government to tackle challenges such as record unemployment and a fast-ageing society after voters gave his party a sweeping mandate for change.
Sunday’s historic election win by the Democratic Party of Japan (DPJ) breaks a deadlock in parliament and will usher in a government that has promised to focus spending on consumers, cut wasteful budget outlays and reduce the power of bureaucrats.
The defeated Liberal Democratic Party (LDP), which had ruled Japan for most of the last half-century, was left to lick its wounds after suffering its worst election performance since the party was founded in 1955.
“It’s taken a long time, but we have at last reached the starting line,” Hatoyama told a news conference at his home in Tokyo on Monday. “This is by no means the destination. At long last we are able to move politics, to create a new kind of politics that will fulfil the expectations of the people.”
Hatoyama is to set up a transition team to organise the change of government, but has said he will not announce his cabinet until he is officially elected prime minister by a special session of parliament, probably in about two weeks.
Investors welcomed the end to a political deadlock that has stymied policies as Japan struggled with its worst recession since World War Two. The Democrats and its small allies won control of the upper house in 2007 and were able to delay bills.
The yen rose to a 7-week high, buoyed by the end of electoral uncertainty. The Nikkei share average edged lower after hitting a near 11-month high as the stronger yen sent shares of exporters lower.
Media forecasts show the Democrats won about 308 seats in the lower house, nearly tripling their strength in the 480-member chamber. The LDP won only 119 seats, down from 300.
“The problem is how much the Democrats can truly deliver in the first 100 days. If they can come up with a cabinet line-up swiftly, that will ease market concerns over their ability to govern,” said Koichi Haji, chief economist at NLI Research Institute.
Spending worries
Despite the Democratic Party’s landslide win, many voters and analysts said the victory was driven more by frustration with the LDP than broad support for the decade-old opposition.
“It’s not that the Democrats were good. I voted for them as a punishment for the LDP. The LDP has to change,” said Etsuji Inuzuka, 47, who works in the furniture business.
–Agencies