People attend a protest in front of the Japanese prime minister's official residence in Tokyo, Japan, Nov 25, 2025. [Photo/Xinhua]
Since taking office, Japanese Prime Minister Sanae Takaichi has repeatedly stressed that her priority lies in economic management. So Tokyo's portrayal of recent moves to test the waters for a snap election as a matter of economic timing or legislative convenience may seem reasonable. Yet a closer look suggests that such deliberation is driven by a far more complex and pressing set of factors, reflecting a government that has reached an early but critical crossroads just about three months after taking power.
Official Japanese data show why such rhetoric resonates in the country: consumer prices excluding fresh food rose around 3 percent year-on-year in 2025, while real wages have continued to decline, according to the Ministry of Health, Labour and Welfare of Japan. The yen's prolonged weakness, which has hovered near multi-decade lows, has further fueled imported inflation, eroding purchasing power for ordinary households.
However, the economic explanation alone fails to account for the urgency with which Takaichi is mulling a snap election. Japan's economy has been trapped in low growth for decades, with nominal GDP expanding sluggishly and public debt standing at over 260 percent of GDP, the highest ratio among major developed economies, according to the Ministry of Finance of Japan. These structural challenges did not suddenly emerge under the Takaichi government and cannot be credibly resolved within a few months. Not to mention that calling an early election could delay the passing of the overall 2026 budget, which needs to be approved before the new fiscal year starts on April 1. This could impact the rollout of immediate economic measures designed to tackle rising living costs, a concern Takaichi has publicly acknowledged.
What has changed, instead, is the rapidly deteriorating political and diplomatic environment surrounding her government.
A key turning point was Takaichi's Nov 7 remarks in the Diet on the Taiwan question, which were erroneous and irresponsible, crossing China's red line. By openly hinting at military intervention in the Taiwan Strait situation and refusing to retract her remarks, Takaichi has severely shaken the political foundation of China-Japan relations, plunging bilateral ties into a low ebb.
The fallout has already begun to weigh on Japan's economic outlook. China has long been among Japan's major trading partners and largest source of foreign travelers, with bilateral trade exceeding $300 billion annually based on Japanese customs data. Any sustained deterioration in ties risks disrupting supply chains, dampening exports and weakening inbound tourism, which has been one of the few bright spots supporting Japan's post-pandemic recovery.
At the same time, under Takaichi's ideological drive to accelerate the country's remilitarization, her government is pushing legislation to expand intelligence capabilities, revise security-related laws and further raise defense spending. Japan's defense budget has already climbed to about 2 percent of GDP, two years ahead of schedule and a level unprecedented in the postwar era. This shift not only undermines the pacifist principles enshrined in Japan's Constitution, but also adds fiscal pressure to an already overstretched budget. Increased military expenditure, coupled with expansionary fiscal policies, risks stoking further inflation and driving up long-term interest rates, as warned by market observers and reflected in rising yields on Japanese government bonds.
Takaichi's political mentor, former prime minister Shinzo Abe, repeatedly used lower house dissolutions as a "cardiotonic" to revive momentum for his right-wing agenda. While tactically effective in the short term, such maneuvers often came with side effects, including deeper polarization, fiscal strain and unresolved economic distortions that Japan continues to grapple with today.
Takaichi seems keenly aware that her approval ratings are likely to decline once the public begins to fully feel the economic consequences of strained ties with China and increased military spending. Beijing's announcement of some justified export restrictive measures last week in response to Tokyo's doubling down on Takaichi's Nov 7 remarks is believed to have further prompted her to consider dissolving the lower house.
Rising energy costs, higher import prices and the indirect inflationary impact of defense spending, which will only be further boosted by Japan's strained diplomacy with its major trading partner, will be difficult to mask indefinitely with subsidies. A snap election, timed carefully, would allow her to capitalize on her waning "honeymoon" popularity, strengthen her fragile majority in the lower house and "lubricate" the path for pushing through controversial policies before public sentiment shifts.
Her planned visit to the United States further underscores the political calculus. Yet such maneuvers also risk reinforcing perceptions that Japan is drifting further away from an independent and balanced foreign policy, to the detriment of regional stability and its own economic interests.
The very fact that a snap election is being seriously contemplated so early in her tenure speaks volumes about a government already under high pressure — and about the uncertain road Japan faces if short-term political tactics are used to override long-term national interests.