Despite Strong Approval Ratings, PM Takaichi Faces Three Key Political Challenges

Working hard but lacking the aptitude?

Eyes wide, eyebrows raised, and making playful gestures—on January 6, at the LDP’s first meeting of the year, Prime Minister Sanae Takaichi (64) showed such a relaxed expression in front of the press (photo). In her greeting, she encouraged lawmakers, saying, “Let’s work hard together.” True to her words, her fierce approach remained unchanged over her first New Year’s holiday as prime minister.

“She didn’t return to her hometown of Nara Prefecture, and listened to the New Year’s bells at the Prime Minister’s Official Residence. She reportedly watched the ‘Kohaku Uta Gassen’ with her husband, Taku Yamamoto (73), but that was about the only quiet moment. At the end of the year, she monitored China’s military exercises. As soon as the New Year arrived, she was busy preparing for a phone call with U.S. President Donald Trump (79) and also preparing for the New Year press conference. It was a hectic holiday season,” said a veteran LDP secretary.

According to the latest Cabinet approval rating released by the Yomiuri Shimbun (December 21 last year), she scored 73%, maintaining an unprecedentedly high level since taking office.

However, behind the scenes, she may have been deterred from returning home due to numerous concerns. Her biggest “Achilles’ heel” is the uncontrollable combination of yen depreciation and rising prices. According to a survey by Teikoku Databank targeting 195 major food manufacturers, 3,593 food items are scheduled for price increases from January to April this year, with an additional 1,000 items expected to rise each month thereafter. Economic analyst Keisuke Nakahara says bluntly, “Ms. Takaichi doesn’t understand the fundamentals of the economy.”

“She proposes a staggering 11.7 trillion yen in the new fiscal year budget as measures against rising prices, ostensibly as a demand stimulus. But this will actually accelerate inflation. Inflation is caused by supply shortages, so taxes should ideally be used to increase production capacity.

In the current situation, scattering money as if combating deflation will only worsen price increases. The idea that issuing government bonds without limit is no problem is also dangerous. If the market loses confidence, interest rates could spike, further fueling a vicious cycle of yen depreciation, which would severely impact citizens’ lives.”

Yasuhiko Fukano, head of Financial Research, commented on Takaichi’s cautious approach to consumption tax cuts: “She says she wants to strongly pursue them. Measures like raising the so-called annual income wall for salary deductions exempt from income tax, or abolishing the provisional gasoline tax rate, are useful for curbing rising prices. On the other hand, stock market gains and inflation mainly benefit wealthy asset holders. Now is the time to eliminate consumption tax on soaring food prices caused by the weak yen, while raising rates on luxury items such as clothing. A more targeted approach is needed.”

At the start of the year, an international incident also occurred. On January 3, Japan time, under orders from President Trump, U.S. forces suddenly struck the Venezuelan capital and detained President Nicolás Maduro (63). Trump claimed the military action was due to drug smuggling and the regime’s legitimacy, but the world was shaken by what was widely seen as a violation of international order. China strongly condemned the action as “hegemonic behavior” and “a breach of international law,” but Takaichi only issued a brief statement on her SNS: “We will continue diplomatic efforts toward stabilizing the situation.” At her January 5 press conference, she gave similarly cautious answers: “We are responding in close coordination with relevant countries,” leaving reporters unconvinced.

“Ms. Takaichi has a previous record of misstatements regarding a Taiwan contingency. Her SNS posts seem to have been checked multiple times. Yet, this is a situation that tests her qualities as Japan’s leader, and her consistently vague answers once again reveal weak diplomatic judgment. Moreover, her response could be interpreted as tacit approval of military action, which could affect how her supporters view her. She should have responded with decisiveness,” said a veteran LDP lawmaker.

Wanting to Reform but Unable to Move

The third source of anxiety lies close to home. The reduction in the number of parliamentary seats, which the Japan Innovation Party (Nippon Ishin no Kai), the coalition partner, has made an absolute condition, has still not been achieved. On the other hand, the Democratic Party for the People’s proposal to raise the annual income wall was agreed to in exchange for cooperation with next year’s budget. How does Ishin feel about what could be seen as the LDP disregarding its coalition partner? We directly contacted Takashi Endo (57), Ishin’s Diet Affairs Committee Chair and also an aide to the Prime Minister, by phone.

—The reduction of parliamentary seats has been deferred for continued deliberation.

“Kyo-chan (Koichi Hagiuda, Deputy Secretary-General, 62) got it as far as submitting the bill. With the public burden increasing, the question is whether lawmakers can sit back without paying a price; it’s a matter of resolve.”

—If it doesn’t happen, will you leave the coalition?

“The LDP is so strongly influenced by organizations and interest groups that even if it wants political reform, it can’t act. But at present, there is no talk of leaving. Since we are working together, we feel strongly that we should continue to support them.”

However, a mid-level member of Ishin revealed: “Ms. Takaichi may be overconfident that we won’t leave the coalition until the Deputy Capital Plan is realized, but there are voices of dissatisfaction within our party about the LDP’s handling. If our signature policies are shelved, our credibility is at stake. Calls for withdrawal could spread.”

While attention focuses on the high cabinet approval ratings, in reality the Takaichi administration is juggling many time bombs, according to journalist Tetsuo Suzuki.

“Expectations are high, but actual accomplishments are still very limited. For example, gasoline tax cuts have been debated in previous administrations for years. The food consumption tax cuts she advocated before being elected prime minister are now being postponed with excuses like modifying registers is too difficult.

In the two and a half months since taking office, she has only held two dinners with Diet members, including Taro Aso (Deputy President, 85), so she has very few reliable close aides. Because public expectations are high, if she does not deliver results, her support could plummet in reaction.”

She will have to work, work, and work, and overcome these three challenges. It is a true test of her leadership.

From “FRIDAY”, January 23, 2026 issue