Historic Coalition in Japan: Sanae Takaichi Set to Become First Female Prime Minister

Japan's ruling Liberal Democratic Party (LDP) and the opposition Japan Innovation Party (Ishin) have agreed to form a coalition government, positioning LDP leader Sanae Takaichi to become the nation's first female prime minister. The agreement follows the recent departure of the LDP's long-standing coalition partner, Komeito, ending a 26-year alliance.

On October 20, 2025, Takaichi and Ishin head Hirofumi Yoshimura reached the coalition agreement during a phone conversation. The formal signing is scheduled for later that day. This partnership marks a significant political shift, as Ishin, originally established to challenge Japan’s political status quo, aligns with the dominant LDP.

The coalition was necessitated by Komeito's departure, which left the LDP without a majority in both houses of parliament. With Ishin's support, the combined seat count in the 465-member lower house rises to 231, just two short of the required 233 for a majority. The LDP is seeking backing from smaller parties to close this gap.

Sanae Takaichi, born and raised in Nara Prefecture, graduated from Kobe University and worked as an author, legislative aide, and broadcaster before entering politics. She was first elected to the House of Representatives in 1993 as an independent and joined the LDP in 1996. A protégé of the late Shinzo Abe, Takaichi held various positions during Abe's premiership, including Minister for Internal Affairs and Communications. She served as Minister of State for Economic Security from 2022 to 2024. Takaichi made her second run for the party leadership in 2024, where she came in first in the first round but narrowly lost in a runoff to Shigeru Ishiba. She ran again in 2025 and placed first in both rounds of voting, becoming party president and defeating Shinjirō Koizumi.

Takaichi is known for her conservative stances on national security and constitutional revision. She advocates for increased government spending and tax cuts. Her domestic policy includes support for proactive government spending and the continuation of Abenomics. She has taken conservative positions on social issues, such as opposition to same-sex marriage, the recognition of separate surnames for spouses, and to female succession to the Japanese throne. Her foreign policy includes support for revising Article 9 of the Constitution of Japan, which renounces the use of military force, and strengthening the US-Japan alliance. She is considered pro-Taiwan and a China hawk. A member of the Japanese ultranationalist organization Nippon Kaigi, she has argued that Japanese war crimes have been exaggerated; she has regularly visited the controversial Yasukuni Shrine.

The Japan Innovation Party (Ishin), originally launched in 2010 to challenge Japan’s entrenched political status quo, is led by Osaka Governor Hirofumi Yoshimura and co-leader Fumitake Fujita. Ishin supports Takaichi’s conservative positions on national security, constitutional revision, and tighter immigration controls. Despite not joining the cabinet, Ishin agreed to a policy alignment, including proposals like reduced parliamentary seats, paused food tax, and social reforms.

The coalition agreement includes policy alignments on diplomacy, security, and energy. While Ishin will not immediately join the cabinet, the parties plan to collaboratively shape policies through a consultative body. Ishin co-head Fumitake Fujita indicated that negotiations are nearing completion and emphasized growing mutual trust.

The potential leadership of Takaichi, known for supporting fiscal and monetary stimulus, has positively affected Japanese equities, pushing the Nikkei to an all-time high, while weakening the yen and stimulating bond markets. On October 20, 2025, the Japanese yen weakened as Takaichi appeared poised to become Japan’s next prime minister. Her expected pro-stimulus stance revived the “Takaichi trade,” which includes bullish equities and a bearish yen outlook.

Despite the historic achievement of potentially becoming Japan's first female prime minister, many women and political commentators express concern over Takaichi's regressive stance on diversity and gender equity. She opposes same-sex marriage and resists reforms on women’s rights, sparking criticism from gender equality advocates.

Takaichi faces urgent diplomatic challenges, including summits with U.S. President Donald Trump and tensions with China and South Korea over her revisionist views and associations with the controversial Yasukuni Shrine. Domestically, she must address inflation, wage growth, and Japan’s demographic crisis.

The formation of the LDP-Ishin coalition and Takaichi's anticipated appointment as prime minister signify a pivotal moment in Japan's political landscape, with potential implications for domestic policies, economic strategies, and international relations.