The Japanese political scene is being set ablaze as we enter October.

The Liberal Democratic Party (LDP), the dominant force in Japanese politics since 1955, will tomorrow (or today if you’re in Japan), choose its next leader and, in all likelihood, the next Prime Minister.

Japan’s hopeful Prime Minister will find that the sweet taste of victory lasts agonizingly brief, however.

They will need to appease the LDP’s current coalition partners - the center-left Komeito, with whom they rule as a minority government, and secure enough ad-hoc support to win election in the National Diet.

Alternatively, they need to negotiate a new alliance, expanding the coalition to other members or building an entirely new coalition.

They will also have to navigate the cutthroat world of internal LDP politics - known for its intricate system of factions and plots, dominated by heavyweight personalities, and increasingly torn between the nationalist right and pacifist left.

All this to say; it’s not just a question of who takes power, it’s how they take power.

Whether it be the conservative firebrand Sanae Takaichi, the liberal centrist Shinjiro Koizumi, or the party old guard Yoshimasa Hayashi who ascends to the Kantei, the question of how Japan’s future will be shaped will ultimately be determined by the size of their victory, and how well they placate rebellious allies and woo skeptical partners.

And so with no further ado, let’s jump into this weeks LDP election special edition of Iwakura, where we’ll predict the next leader, analyze their path to the Kantei, and and scrutinize the consequences for Japan and Europe.

The Iwakura Prediction: It’s Complicated

Political commentators and journalists traditionally refrain from trying to call elections before they happen. Or, at least, they have since 2016.

It’s a fools game, everyone knows that. It can only result in embarrassment, bruised egos, and damaged credibility. Not to mention that politics can throw up a million unexpected surprises that can thwart even the most sound prediction. Just ask Nate Silver.

I am not Nate Silver, but I am a bit of a fool.

And so the official Iwakura prediction is that Shinjiro Koizumi will win the LDP leadership race and thus, become Japan’s next Prime Minister.

The young, centrist liberal is as close to a European-style politician that Japan is capable of producing, at least, if one still views Europe as a centrist continent.

With more of a hint of Macron about him, his European style net zero climate policies, relatively open attitude to migration (though all candidates have pledged to reduce it), and muted defense policy clashed with Takaichi’s American style skepticism of net zero, hardline approach to migration, and nationalist focus on the military.

But this is where it gets complicated - Koizumi may well win the election, but his politics will have suffered a loss.

Let me explain.

The Road to Election

If Koizumi does win tomorrow’s election, it will be rooted in his support from sitting National Diet members of the LDP, not the party rank and file.

The trick is in the procedure.

The first round of the LDP leadership race will take place between all five candidates who have entered the race. In this round, each member of the LDP party is allowed to vote for their first preference, allocating 295 votes proportionally to that vote.

At the same time, the elected politicians of the LDP in the national diet receive one vote each, allocating 295 votes for a total of 590 votes between the five candidates.

Polling of the LDP membership has consistently revealed a lead of several points for Takaichi over Koizumi, followed by Hayashi. If these polls hold up for the election she will lead Koizumi in the popular vote.

Ms. Takaichi, however, is on the wings of the party. A staunch right winger, she is extremely unpopular with the LDPs sitting politicians, outside of her direct factional support.

Neither Takaichi nor Koizumi are capable of reaching a majority in the first round, and so the top two candidates will immediately go to a runoff, which is calculated on the same day.

The rules in this second round are completely different. Whilst national diet members retain their 295 votes, rank-and-file members instead only allocate 47 votes - one for each of the 47 local chapters of the LDP, who distribute them according to how their members voted in the first round.

That makes a Koizumi victory an all-but-certainty in the second round, no matter what the party rank and file think.

His slight deficit in the popular vote is more than compensated by his popularity amongst the party’s serving politicians - with almost double the number of sitting politicians declaring their support for him in the first round, compared to Takaichi.

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Factional Warfare

The scenario described above describes how things will go if there are no last minute surprises.

But there are more than a few of those last minute surprises waiting on the sidelines, ready to ruin any handsome young Substacker’s electoral prediction.

The LDP is legendary for its secretive, ever-changing, system of factions, that congregate around the personal figures of its political heavyweights.

It is rumored that two of the largest of those factions - the powerful Aso and Motegi factions, are planning to whip their followers to vote for Takaichi, which would be enough to thwart Koizumi’s campaign if her vote holds up in the rank-and-file.

Then there’s also the figure of the third placed outsider - Yoshimasa Hayashi, the continuity candidate of former PM Kishida’s faction.

If Hayashi and the Kishida faction were able to gather enough support from sitting MPs, they might well undermine Koizumi and snatch second place from under his nose, and providing a far more palatable candidate for many than the conservative firebrand Takaichi.

Intriguingly, the same could not be said were Hayashi to gain second place at Takaichi’s expense. In this scenario, Koizumi would be almost certain to win as the Aso faction would never vote for a Kishida faction.

Yes, I should explain that more, but by now I’ve overwhelmed you with names of obscure Japanese politicians and different factions. The story of those factions will have to wait for another day.

Size Matters

But beyond the potential for an electoral upset, Koizumi’s first big barrier after the LDP’s leadership election would be Japan’s electoral politics.

The defining feature of Shigeru Ishiba’s Prime Ministership was his relative lack of political space. It would be unfair to call him a lame duck, but he teetered on the edge of it.

The LDP’s partnership with its current coalition partner, Komeito, is simply too narrow. They are, after all, a minority government, and the LDP too broad an umbrella to rely upon, to have any degree of parliamentary stability.

Koizumi would have to find a way of appeasing both the hard right nationalists of the Takaichi wing of the LDP, who believes that Japan should rearm to challenge China, and the pacifist center left Komeito.

Koizumi will therefore seek to expand the coalition - and his prime candidate is Japan’s libertarian party, the Japan Innovation Party (Ishin no Kai), who have made Osaka a stronghold since their foundation.

Keen politics watchers might wonder how easy creating a coalition between a center left party that advocates for greater social spending, and a right leaning libertarian party that wants to slash social spending, will be, and, well, yes. It’s going to be as difficult as it sounds.

This is where the margin of Koizumi’s victory would come in.

Were he to rout Takaichi and surge to power on a wave of support, he would be able to employ the LDP heavyweights in seeking that coalition. He would command the support and respect of the party, turning the deal offered to Ishin from ‘Would you like to support a weak PM?’ to ‘Would you like to have a voice in the future of policymaking?’.

Size, it turns out, very much does matter.

Conclusion

So what does this mean for Europe? Well, as always, it depends.

Whilst there are only three viable winners of this election, there are an infinite number of possibilities for what the next government will look like. Different winners, different collations, different balances of power, all combine to make an impossible mélange of scenarios.

If the Iwakura prediction rings true, then a weak Koizumi scenario will appear. The hard, nationalist right, emboldened by a surge of popular support, will scupper the left-leaning policies that the coalition needs for its partners support.

Meanwhile, the surge of public support for anti-migrant, right wing rhetoric, will benefit Takaichi and the meteoric rise of Sanseito. Anger unaddressed is anger compounded.

In effect, we will be back to where we were with the Ishiba government - a weak parliamentary arithmetic that’s just enough to prop up a government, but not enough to enact bold reform.

For Europe, this means continuity. A Japan that remains a stable partner, but one too paralyzed to take meaningful action on migration, climate, or security.

And that can only mean one thing - the new Prime Minister will not be for long.

A Familiar Story

Picture the scene; as the economy flounders, and concern over migration fuels ever more fractious social tensions, a surge in support for a right wing populist shatters the political orthodoxy, forever changing the nations political landscape.

It’s a story that will feel very familiar to you, right?

In fact, don’t answer that, I’m going to confidently (arrogantly?) assert that it does indeed sound familiar.

The reason for this confidence is twofold.

Firstly, because yes, this could describe any developed country in 2025, but also because I cheated. According to Substack analytics, not one single reader of Iwakura magazine comes from a country where this does not apply.

The magic of data analysis in action, folks.

But until really quite recently, Japan might have been one of the only contenders considered exempt from this rule. As Trump and Brexit rocked the anglosphere, and as Le Pen, Weidl and Meloni stormed continental Europe, Japan’s Liberal Democratic Party (LDP) remained calm, steady, and in control as ever.

Alas, no longer.

The Road to the Kantei

The LDP kicked off its leadership contest on Monday, looking to replace outgoing Prime Minister Shigeru Ishiba, who resigned earlier in September.

The launch of the leadership contest was almost immediately followed by a surge in support for the conservative firebrand who would be Japan’s first female Prime Minister - Sanae Takaichi.

Whilst her main challenger, young centrist Shinjiro Koizumi, had gone into the contest neck and neck with Takaichi, he was immediately beset by scandal, with members of his staff found to be posting false comments of support online, seeing his support plummet.

The scandal soon claimed the head of Koizumi’s PR team, Karen Makishima, who resigned soon after.

Takaichi now sits 6 points clear of Koizumi, according to an NTV poll of registered LDP members on the 23-24 September, and looks set to increase her lead going forwards.

Whilst Takaichi’s path to the Kantei (the residence of Japan’s Prime Minister - 総理大臣官邸, Sōri Daijin Kantei) may still hold several twists and turns yet, its hard to ignore her decisive lead ahead of the vote on 4 October.

Its even harder to ignore the surge in popularity for her right wing, anti-migration policies, which she has placed front and center of her campaign.

Japan, to cut a long story short, is in the mood for populism.

Revere the Emperor, Expel the Barbarians

Japan is no stranger to anti-migrant revolts.

Sonnō jōi (尊王攘夷 - Revere the Emperor, Expel the Barbarians) was the rallying cry of Japan’s modernization movement in the Bakumatsu period (the final fifteen or so years that immediately preceded the end of the Shogunate in 1868).

The jōi (Expel the Barbarians) part of Sonnō jōi provides an apt framing for Japan’s modern political woes.

Japan has seen an explosion in anti-migration sentiment. More than a few Japanese calling for jōi.

In March 2025, a demonstration in Osaka, against Japan’s rapidly growing Kurdish community achieved international fame when Elon Musk tweeted his support.

In that protest, several thousand demonstrators carried banners bearing slogans such as ‘end mass immigration’. Other protests have seen banners such as ‘Kurds should get out of Japan’.

I’m sure it’s catchier in Japanese, but you get the point.

This might be surprise Westerners who have visited Japan. One of the most obvious contrasts between Atlantic nations and Japan is its relative homogeneity - with the most visible foreign presence being Chinese and Vietnamese tourists.

Even then, outside of the heavily trafficked tourist areas of Tokyo (Shibuya Square) or Kyoto, visibly foreign people are relatively few.

This changes somewhat after dark. I am quite partial to taking (jetlag induced) late night/early morning walks when I visit Tokyo, when the cities African and Indian population emerges to staff the plentitude of 7-Elevens, Lawsons, and other flavors of Konbini.

But even accounting for the night economy, the number of foreigners in Japan is staggeringly small.

Japan in its entirely has around 3.8 million foreign born residents in a population of around 120 million. To put that in context, Los Angeles alone has roughly the same number of foreign born residents, and London hosts 5.2 million foreign-born residents.

Viewed from the eyes of an Atlantic nation, one wonders what all the fuss is about.

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Migration Frustration

Despite the relative small amount of migrants, Japan has reacted strongly to the steady liberalization of immigration policy.

That liberalization, by the way, is an entirely new thing - having taken place only in the last few years.

Whilst Japan has always had limited visa schemes, but these have always been extremely restrictive and non-permanent in most cases.

An example that I simply cant resist including is the Nikkeijin (Japan’s foreign diaspora) visa scheme, targeting Brazil’s roughly two million citizens of Japanese descent. Two million! Brazil!

But it was only in 2019 that Shinzo Abe oversaw Japan’s first flirtation with migration, introducing the Specified Skilled Worker scheme, liberalizing visa issuance across fourteen key sectors.

It proved to be the crest of the slippery slope, and Prime Ministers Kishida and Ishiba oversaw a spike in expansions to further sectors, allowances and exceptions.

The backlash was immediate and fierce, prompting demonstrations across the country of varying sizes.

We Dont Want to Be Europe

One feature of Japan’s migration protests has been the constant highlighting of Europe as a path that Japan should not follow.

Fears that Japan would undergo the same type of demographic shift and social tensions that define Europe in 2025 are immediately apparent in every aspect of Japan’s migration protests.

A report by libertarian party Nippon Ishin No Kai, for example, warned that Japan would go past the point of no return if it reached the ‘European threshold’ of 10%. Senior officials of the Japanese conservative party, Nippon Hoshuto, explicitly warned against following Europe’s path.

But nor was the issue relegated only to politicians. Academics and journalists also emphasized the need to ‘learn from Europe’s mistakes’ on integration policy.

Economic Troubles

But yet, for all the anger, introducing migration was intended to be the medicine for the comatose Japanese economy.

In 1995, Japan represented 15% of world GDP, but only achieved an average growth rate of 0.7% in the thirty years since, compared to the ~2% achieved by Europe and 2.5% achieved by the United States.

The difference between those rates might feel miniscule, but make no mistake - it’s gargantuan. With the sheer numbers that we talk about when we talk about a modern, developed economy, and the effects of compounding, a 0.5% difference in growth rate has enormous consequences.

For example, an economy with a growth rate of 2.5% - such as the United States, will double in size every 28 years, whereas one with 0.5% will double every 140 years.

And thus, whilst the United States and Europe have seen their economies more or less double since 1995, when mass migration really took off, Japan’s economy has grown so slowly that its relative share of the world market has decreased.

Japan may not want to be Europe in its demographics, but it certainly wants to be more like Europe in its economy.

And herein lies the tension. For all of its flat growth, Japan has held up surprisingly well.

Thirty years without growth has not been the doomsday scenario that many predicted.

The ‘GDP line’ has not gone up, but Japanese standards of living have remained stable. Consumer prices have barely risen at all since the 1990s, and unemployment is low. Japan boasts the highest life expectancy in the world, and few argue that Tokyo is a less pleasant place to live than London.

Japan might have accepted the need for more migration, as the United Kingdom did in the 1970s, or as France and Germany did in the 1960s, had there been an urgent need to reform.

But for many Japanese, the medicine is worse than the disease.

Sanseito - Do It Yourself!

From the rejection of this medicine, Sanseito was born.

Sanseito was born in 2020 as an ultraconservative, right wing populist movement. Founded by Sohei Kamiya, a former LDP politician that Shinzo Abe had personally campaigned for, and a motley crew of YouTube stars, its success was immediate.

In less than five years, the party expanded rapidly and captured 14 seats in the 2025 House of Councilors (upper house) elections, becoming the third largest opposition party behind Japan’s center left and libertarian parties.

The speed of Sanseito’s growth is that, amongst right wing populist parties worldwide, only Italy’s Movimento Cinque Stelle (M5S) has grown faster.

The lesson has not been lost on Japanese politics or politicians - few of whom wish to see a US/Europe style polarization occur.

But neither can Sanseito’s support, or its supporters, be ignored.

Back to Takaichi

Its clear that Sanseito, and the forces driving them, are here to stay.

And as long as they remain, each leap forward and each victory in the story of their spectacular rise will drag the mainstream further to the right. Just as Le Pen reshaped France, and Meloni reshaped Italy.

Japan now faces a choice that will feel familiar to Europeans.

In Takaichi, it has a Meloni-like figure: a limited embrace of the populist revolt, channeled and managed through the establishment. In Koizumi, the choice is a Macron-like centrist who insists the true crisis is economic stagnation, not migration.

On October 4, the LDP will have to decide.

For decades, Japan seemed immune to the populist uprisings that convulsed the West. That immunity has expired. The world’s third-largest economy is about to choose its path — and the choice looks far more familiar than outsiders once believed.

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(Rail)Gunning for Glory

Railguns are, without a doubt, one of the coolest things on planet Earth.

And if, like me, your inner teenager remains a strong influence on your life, I hope that you are now irresistibly hooked on this article, and all the railgun-ny goodness that it contains.

Indeed, that inner teenager has now labelled the Japanese Maritime Self Defence Forces (JMSDF) as ‘officially’ the coolest navy in the world.

This is as its technicians managed to overcome a set of huge engineering problems, to become the worlds most likely candidate to possess a viable, railgun-toting navy.

At least, that’s according to Japan’s Ministry of Defence, who announced that the JS Asuka had successfully carried out a railgun strike upon a sea-based target, over the summer.

Japan, a nation committed to pacifism by its constitution, that also renounces the usage of military force to settle disputes between nations, was perhaps an unlikely candidate to emerge as a world leader in railgun technology.

That is especially so, as the United States itself was forced to end its own development programme in 2021, being unable to render its experiments accurate over long distances, or to solve the problem of its prototypes degrading quickly.

Given that Japan has succeeded where the United States could not, the mission of the JS Asuka becomes reflective of the bigger picture. In a region of the world defined by security threats from Russia, China and North Korea; the Japanese Navy is back (baby!).

Japan’s Quiet Rise to Naval Dominance

Underpinning the success of the JMSDF, as ever, are the legions of private sector companies manufacturing its equipment. These Japanese firms are becoming integral to global security.

In August, for example, Australia announced that it would purchase eleven of Japan’s Mogami-class vessels, at a cost of $6.5bn, soundly beating Germany’s MEKO A-200.

This deal is the largest defence export in Japanese history - and there’s so much more where that came from.

The Mogami class, in service with the JMSDF since 2022, boasts advanced stealth and radar technology, mine laying and detection capabilities, and a relies on automation to enable smaller crew sizes.

It’s newest models, eleven of which will be provided to Australia, and twelve of which will safeguard Japan’s shores, has a true claim to being amongst the best in the world.

Few could have envisaged that the JMSDF, which in 2008 represented the small, regional-at-best force of a pacifist nation, would rise to having best-in-class ships by 2025.

But forget about best-in-class ships, Japan now has a claim to a best-in-class navy. Having increased its numbers by over 50% since the 2008, and with a $350bn five-year defence plan in place since 2022, Japan’s surface fleet outclasses it’s European equivalents (although Europe still retains several strategic assets, such as carriers and nuclear submarines, where Japan falls short).

Abe’s Vision

The man responsible more than any other for this transformation, and the re-emergence of Japan’s naval might, is Shinzo Abe.

One of Japan’s most impactful Prime Ministers, Abe’s reforms in the 2010s allowed Japan’s defence forces, and its defence industry, to thrive.

Whilst these reforms were extensive, it was his reinterpretation of Article 9 of the Japanese Constitution that truly mattered, allowing Japan to practice collective self defence.

And with a docrtine of collective defence, the lifting of certain restrictions on defence exports naturally followed. Allowing exports has proven to be the game changer, in a world where defence companies rely on non-domestic contracts for resources, cash flow, and expertise.

Prior to Abe’s reforms, Japan’s defence sector operated with a purely domestic focus, owing to Japan’s history than any real desire

Without going too far down the historical rabbithole, the Allied occupation of Japan following the Second World War saw a Constitution imposed upon it, including Article 9, forbidding Japan from rearming and rejecting the usage of warfare in disputes between states.

But the world of 1947, when the Constitution was adopted, was not to last long. Two years later, the Chinese Civil War would conclude with a communist victory, and in 1950 the Korean War would break out.

By 1954, the structure of Japan’s Self Defence Forces would emerge, but both it and Japans once mighty defence sector would remain restricted by the constitution until Mr. Abe’s reforms.

A Rising Sun

Mr. Abe’s reforms reflected a broader trend in Japanese society - the realisation that pacifism is no longer sustainable.

We have previously looked at Sanae Takaichi, a strong contender for the next Japanese Prime Minister, and her involvement with the conservative pressure group Nippon Kaigi.

It should be no surprise to anyone that Mr. Abe was also a member of Nippon Kaigi, whos arguments for rearmament and the strengthening of Japan’s military now enjoy widespread reach in Japan’s political right.

Remember, Japan considers Russia to illegally occupy the southernmost four of the Kuril islands - Etorofu, Kunashiri, Shikotan, and Habomai. Between illegal occupation, and an increasingly hostile geopolitical environment, there’s only one conclusion to reach:

Japanese rearmament is here to stay.

And that political stability is very good for business.

It’s difficult for a for-profit company to dedicate the necessary resources to R&D and production to equip a military in peacetime. One of the ways that modern defence companies increase their resources is by actively seeking exports and overseas contracts.

The solidification of Japan’s political case for rearmament has led to a boom, as companies like Mitsui, Kawasaki, Mitsubishi Heavy Industries, and Mitsubishi Electric, were suddenly able to expand their domestic defence industries abroad.

Japan’s first major export of defence equipment followed almost immediately (in business terms), with Mitsubishi Electric successfully exporting radar to the Philippines, having won a contract in 2020, and having supplied the equipment since 2023.

In the air too, Japan is ascendent. Mitsubishi Electric again, together with Mitsubishi Heavy Industries, IHI Corporation, and others, form the Japanese side of an Anglo-Italo-Japanese consortium to work on the Global Combat Air Programme (GCAP).

GCAP will produce a sixth generation fighter for delivery in the 2030s, and looks set to only truly be rivalled by the United States Next Generation Air Dominance (NGAD) programme. Further entrenching Japanese expertise, presence and credibility in the defence sector, Japan has done very well out of its participation in this programme.

All this to say, the future is looking bright for the Japanese defence industry. It’s enjoying an economic surge, it’s enjoying strong political backing, and it’s making historic breakthroughs in technology.

The European Connection

Japan’s booming defence industry coincides with similar trends in Europe, which itself is looking to rearm its militaries and expand its own defence industrial base.

Most recently, NATO nations agreed to increase defence spending to 5% of members GDP. This, in effect, will increase European defence spending from 325bn EUR to 900bn EUR.

This pot of money is attracting Japanese business. Beyond the joint consortium created by the GCAP project, Japan appointed a dedicated ambassador to NATO in early 2025, whose remit includes helping Japanese companies access NATO tenders.

The interests of both partners are converging: European financial weight and Japanese technical know-how are a natural match. This partnership is the one to watch.

To put it bluntly; Japan is back.

It’s defence sector can no longer be ignored. From railguns to next-gen fighters, Japan is now a first-tier defence innovator. Europe’s challenge is no longer whether to work with Japan, but how fast.

An unusually peaceful, sunny, and warm Sunday morning in the capital of Europe was disturbed yesterday by the news that the Japanese Prime Minister, Shigeru Ishiba, had resigned.

Mr. Ishiba’s resignation followed July’s dramatic election results that saw the Liberal Democratic Party (LDP) lose its majority in the upper house, and the populist Sanseito party make stunning gains.

This, in turn, was preceded by the LDP’s loss of its majority in the lower house in October, for the first time in almost 15 years.

The story of an entrenched political system being uprooted by a populist surge is a familiar one in Europe, as is the frustration with poor economic growth and immigration that fueled Sanseito’s performance.

Perhaps this is why Europeans were quick to speculate on Sanae Takaichi, the populist right-winger who would be Japan’s Giorgia Meloni, as the figure who would become Japan’s next Prime Minister.

In this article, we will look at Ms. Takichi and ask the question: Is Japan really going through its ‘Meloni Moment?’.

A Word on Procedure

But firstly, it’s standard practice for veterans of politics to keep one eye on procedure whenever discussing anything. It is often procedures, dates, and timelines that guide political change, not headlines.

The LDP has now set its Presidential election date for 4 October. whoever wins this contest will become the leader of the LDP.

Ms. Takaichi has already announced her candidacy and emerged as a frontrunner.

But leading the LDP does not make you Prime Minister. The post of Prime Minister is chosen by the Diet, with a vote in both the lower and upper house.

This poses a particular headache for the LDP as, following its losses under Kishida and Ishiba, it holds neither a majority in the upper nor lower house.

The next candidate must therefore be capable of either retaining the LDPs current coalition partner (Komeito) or finding new coalition partners, preferably without fracturing the LDP.

Sanae Takaichi

The intense political discussions, schemes, and grandstanding that follow the fall of any politician always have some degree of unpredictability, but early reactions quickly focused on Ms. Takaichi.

Ms. Takaichi, a former minister in Shinzo Abe’s cabinet and 30-year veteran of Japan’s political system, is no stranger to the spotlight, having only narrowly lost the LDP leadership contest to Shigeru Ishiba in 2021.

A staunch conservative who views Margaret Thatcher as her role model, Ms. Takaichi has followed in the footsteps of European counterparts Marine Le Pen, Giorgia Meloni, and Alice Weidl as a leading woman championing solidly right wing social positions.

These views include opposition to same-sex marriage, and criticism of immigration. She described a 2020 gender equality plan has potentially ‘destroying Japans social structure’.

Further, Ms. Takaichi is a card-carrying member of Nippon Kaigi, an influential conservative pressure group advocating for increased nationalism, rearmament, and a rejection of guilt for alleged Japanese war crimes during the second world war.

These views are relatively popular in Japan, and Mr. Ishiba’s liberalisation of immigration policy quickly fueled right-wing support in a country known for its homogeneity, seeing Sanseito emerge from obscurity to achieve fantastic gains.

A JNN opinion poll revealed that Ms. Takaichi was the joint-first forerunner in ‘who would be the most fit to become Prime Minister’. A Nikkei poll in August revealed her beating closest challenger Shinjiro Koizumi.

As Europeans know all too well - right wing figures drawing level with ‘establishment’ candidates often herald a populist wave.

The Trials of Takaichi

But for all the political momentum with Ms. Takaichi, and all the support she has gathered, there are still strong question marks over whether she will be able to take the reigns, with multiple hurdles yet to clear.

Firstly, and perhaps easiest, she will have to collect 20 nominations from sitting LDP members to be eligible for the vote.

Ms. Takaichi already achieved this in 2021, with the strong support of the Abe faction, and is likely to do so again, but a determined effort by the LDP’s centrist stalwarts might see her robbed at the first opportunity.

But Ms. Takaichi’s most severe threat would be the process of appointment to the position of Prime Minister.

The Japanese Prime Minister is elected with the consent of the Diet, where the LDPs reduced position would work against Ms. Takaichi. The LDP has long governed in coalition with the Komeito party, a pacifist party distinctly to the left of the LDP and in firm opposition to almost all of Ms. Takaichi’s views.

Leader Tetsuo Saito said on Sunday that Kometio ‘cannot form a government unless it is with someone who aligns with our conservative-centrist ideology’.

That, evidently, is a warning shot at Ms. Takaichi, who would struggle to find dependable support elsewhere.

Sanseito might have boomed, but they still hold only 15 seats in the upper house and 3 in the lower, far behind Komeito. Further, courting Sanseito’ support would be anathema to almost all of Japan’s centrist parties, and certainly provoke rebellion in the LDP.

So too, do other potential allies find themselves unable to make up the numbers. Ishin no Kai, a libertarian party. are collapsing amidst internal rebellion, with several members leaving to form a separate party after Mr. Ishiba’s resignation.

Other parties are simply too far politically to consider partnership with Ms. Takaichi.

Analysis: More Le Pen than Meloni

Whilst Ms. Takaichi has emerged as a forerunner in the immediate aftermath of Mr. Ishiba’s resignation, the sense that the tide is against her feels overpowering.

Whilst none of the hurdles that she would have to face to take office are necessarily insurmountable, the grandees of the LDP party have ready-made solutions elsewhere.

The emergence of centrist Shinjiro Koizumi, for example, who is currently the strongest challenger against Ms. Takaichi, provides a far more viable coalition builder given the current electoral arithmetic.

There remains a lot of noise in Europe about the potential for a populist leader in Japan, and with some justification - Ms. Takaichi simply cannot be ignored. But for the moment, these reflect a projection onto Japan of Europe's own transition into populism.

Is Japan undergoing its Meloni Moment? Not quite. Ms. Takaichi seems to have reached the Le Pen moment of populism - on the edge of victory, but not quite there yet.

Japan Becalmed

Japan’s hopes for offshore wind are beginning to look a lot like hot air.

Last week, three critical offshore wind projects collapsed as factors combined to more than double construction costs in less than a year.

Mitsubishi Corporation, a long time member of the sogo shosha (Japan’s largest trading houses), and Chubu Electric, of Osaka’s four influential companies, followed in the footsteps of engineering group Kajima by departing the consortium.

Kajima’s departure in particular posed a problem, as one of the only companies capable of handling the tricky offshore construction work.

Japan’s unique geography results in relatively common tsunamis and earthquakes, compounded by a deep ocean shelf that is difficult to build on, make offshore wind that much more difficult.

But, ever optimistic, Japan has great hope for wind power. It hopes to include wind as 10% of its energy mix by 2040. The country's national energy plan, approved in February, played a key role in delivering market predictability, identifying several key projects to launch by 2030.

Indeed, any company in wind simply cannot afford to disregard Japan and its market of ~$6bn, representing anywhere between 6-10% of the world market.

But why then, given these seemingly favorable market conditions, have these forays into wind ended so disastrously?

Global Winds

The answer lies overseas.

The United States has all but withdrawn from wind power. Tariffs, Section 232 investigations, and political interference from the new administration have driven away investment. A federal demand to halt to construction on an almost finished project off Rhode Island has even resulted in the states suing the government.

BloombergNEF estimates that US renewable investment plummeted 26% in 2025 alone, representing almost $20bn in lost capital.

Lost capital that Europe has hoovered up.

European investment in wind alone reached an all-time high of $40bn last year, representing around a third of the globe's total installed wind capacity and a fifth of new installations. It’s governments have doubled down on renewables and continue to subsidize and invest in projects across the continent.

But both the US retreat and the European advance have been in reaction to the looming giant on the other side of the battlefield - China.

The worlds largest market for wind energy by far - accounting for almost half of all global renewable energy investment, had more offshore wind capacity than rest of world combined in 2023.

Chinese turbine makers such as Goldwind, Envision, and MingYang have harnessed this market power and now produce at 30-40% cheaper than their European and Japanese competitors.

Selective Sakoku

Free traders have yet to produce the answer to this type of problem. What do you do when your domestic industries simply cannot compete?

Whilst America has resorted to a more obvious move to protection, both Europe and Japan have seen more subtle withdrawals from free trade.

In Europe, procurement rules, national subsidies, foreign investment screening, criteria in public auctions, and legislation to prevent a single country dominating a sector, conspire to keep China out.

So too does Japan. Offshore wind tenders reward bidders who use Japanese shipyards, manufacturers, and labour. Foreign investment in energy manufacturing requires prior approval under the Foreign Exchange and Foreign Trade Act.

Japan has been here before. In the Edo period (1600-1870~), the doctrine of Sakoku (鎖国 - locked country) closed the country to all but the most privileged of outside trade. The Meiji period saw instead Kaikoku (開国 - opening of the country) usher in an era of free trade, and foreign machines, ships, and ideas.

To draw a full circle; just as Kaikoku was a reaction to the deficiencies of Sakoku in 1870, so too are elements of Sakoku a reaction to the deficiencies of Kaikoku today.

Or, to cut away the metaphors; Japan is trying to do selective sakoku; open when convenient, closed when not.

The Price of Protectionism

But selective Sakoku hasn’t worked for Japanese wind.

The price of keeping rivals and competitors out of your market, is that they’re out of your market! This is a particularly high price to pay when it comes to China.

China dominates the rare earth magnets, steel, and blade production that wind needs to thrive. When demand surges, or significant market distortion happens, restrictive trade with China places huge pressure on throttled supply chains.

This is exactly what happened when the United States sent the signal that wind had no future. Capital pivoted to Europe, and demand crashed in one continent and boomed in another. Capacity previously allocated to Japan was directed elsewhere.

Construction costs indeed doubled in less than a year - frankly, they probably would have tripled by Christmas. Investors saw their potential returns plummet, and the carefully laid roadmap envisioned in Japan’s 2030 energy plan dissolved in the space of a few weeks.

And Japan had done absolutely nothing to provoke it.

This, dear reader, is the price of protectionism.

Strong Gales Ahead

But be that as it may, Sakoku is here to stay in both Europe and Japan.

And it’s going to become a lot less selective.

China simply represents too great a challenge to a free trading world. Economic security has become a buzzword in both Tokyo and Brussels, with regulators all too keen to keep China’s ultra-competitive turbine makers out, scarred by the disappearances of industries where they failed to do so.

As for wind, new contracts will be issued, new auctions created, and new consortia formed. But in curtailing the power of free trade, the vulnerability will always remain.

Japan wants the progress of Kaikoku, without abandoning the guarded walls of Sakoku. In offshore wind, that contradiction has left it becalmed. The lesson is blunt: you might well be able to lock the gates, but you can’t summon the wind.

Of Abe and Antwerp

On my last trip to Tokyo, I joined some of my colleagues for after-work beers.

Expecting a Japanese-style pub, packed with exotic sake and whiskies, I arrived instead at ‘Antwerp Central’, a Belgian bar full of the decidedly non-exotic beers that I had just left behind in Brussels.

It may sound like a drinking joke, but it’s really a snapshot for how intertwined Europe and Japan have become.

Parisians read Japanese manga, Osakans furnish their apartments at Ikea, Stockholmers drive Toyotas, and Tokyoites eat at Italian restaurants.

But relations weren't always this warm. The warmth is, in fact, surprisingly recent.

It was as recently as Shinzo Abe’s premiership that the relationship really began to boom. Before Mr. Abe, cut-throat competition in automotive and electronics induced a fierce rivalry in the eighties, that eventually settled into lukewarm friendship by the turn of the millennium.

Japan’s longest serving Prime Minister wanted to defy the trend and draw closer to Europe, and it’s easy to see why.

Both Europe and Japan are flourishing democracies, with vibrant free markets to power their modern, advanced, economies. Trade in goods and services between the two hovered around $200bn in 2024 - an all time high, that rises every year.

And both face similar challenges. Demographic decline has driven populist revolts in both entities. Both have manufacturing dominated economies that have felt the strain during the transition to a digital world. North Korean troops launch missiles over Japan one day, and lead assaults on Ukrainian trenches the next.

To put it bluntly; good relations may be a new thing, but they’re here to stay.

Enter Iwakura

“Very well”, I hear you cry. “Japan and Europe are cooperating. That’s nice. But wasn’t this article about this Iwakura thing?”.

Sure. Let’s start with what Iwakura is.

The Iwakura Mission was a diplomatic mission that set sail from Yokohama in 1871. Named after its leader, Iwakura Tomomi, this mission was one of many conducted by Meiji-era Japan, aimed at studying the industry, politics, and societies of the great powers.

After a visit to the United States, Iwakura led his team to Paris, Amsterdam, Vienna and Rome, as well as the authors beloved hometown of Manchester. In each city, the delegation exchanged technologies, learned from industrial and political leaders, and sought to cooperate and exchange as much as possible.

It’s in that spirit of cooperation, mutual learning, industrial exchange, and dare I say, a bit of adventure, that this magazine was named.

A New Mission Statement

But there’s more to Iwakura than the name. Iwakura wants to help solve a problem.

In downtown Brussels, in offices overlooking the Berlaymont, the Japanese business community has a booming presence.

In Tokyo, the European delegation sits a short drive from the famous Shibuya square. The European Business Council in Japan sits close to the Imperial Palace and next to the important ‘Mitsubishi quarter’ of the city.

But for all this infrastructure, and for all the Euro-Japanese relationship has grown, both sides still struggle to understand each other.

This is in some ways understandable. Can a Japanese salaryman in Tokyo be expected to understand the regulatory processes of the European Commission? Can the director of an Italian factory be expected to understand the absolute power of the Keidanren?

Can either be expected to understand the similarities, in wealth, power and influence, between Europe’s national champions (e.g Volkswagen and Sanofi), and the Japanese Zaibatsu (e.g; Mitsui or Sumitomo)?

Understanding the market and politics of the other is an enormous challenge, that no business, no entity, can truly say to have solved. Just look at the ‘Big Four’ consultancies, who have hoovered up millions as a result of this. They hold and maintain de-facto monopolies on the market access, business advice, and compliance expertise needed to broaden the relationship.

Perhaps the largest companies in the world think nothing of paying for this advice, but what about the backbone of our mutual economies? The small Japanese whiskey exporter, or the European machine tool manufacturer, are losing out.

Pillars of Business, Politics & History

And so, if the intolerable cliche of drawing inspiration from Japanese history, or my heavy handed wielding of Japanese words to seem more exotic hasn’t driven you away, you’ll by now have an idea of where I’m going with this.

By writing on the Euro-Japanese relationship, Iwakura is going to breach, in its own small way, the gap in understanding between the two partners.

And it’s going to focus on three pillars of cooperation as it does that.

• Business - the heart of the Euro-Japanese relationship. It drives trade, jobs, and innovation, and it’s the core of Iwakura. From Japanese heat pumps helping Europe hit its climate targets to European pharmaceuticals filling Japanese pharmacies, Iwakura will track the economic currents that bind the two sides closer together.

• Politics - setting the rules of the game. Business can’t be understood without the politics that shape it. Do Europe’s populists really have that much in common with the Japanese Sanseito party? Why is Osaka the home of libertarianism, and why does that matter for Europe? These are the kinds of political dynamics we’ll unpack.

• History - context and continuity. Europe and Japan are unusual in that many of their biggest companies are older than the states they belong to. The Mitsubishi group traces its origins back to the 19th century, Volkswagen to the industrial ambitions of post-war Europe. Understanding these histories is the key to understanding how today’s corporate giants and political systems really work.

Setting Sail

So TLDR; what can you expect from Iwakura going forwards?

Every Wednesday, you can expect one of three core article types dropping in your inbox.

• Iwakura Business - Markets, technology, business, and investments. Think Bloomberg-lite.

• Iwakura Politics - High-level political analysis of EU-Japan politics. Think Politico-lite.

• Iwakura History - Business focused history, connecting to what’s driving the news today. Think… Ok, I don’t have an example here.

And look, if you’re the type of person who’s interested in business, politics or history blogs, then I know already that you have a high tolerance for dry content, but this isn’t Iwakura.

Iwakura is going to be snappy, to-the-point, legible, and informative. It’s not going to take itself too seriously, it’s going to be jokey, and self-deprecating, just like the author.

If this all sounds good to you, and you’re curious about how Europe and Japan shape each others future, then subscribe to step aboard the new Iwakura Mission - first article dropping tomorrow!

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