Japan’s parliament, the Diet, elected last week Yoshihide Suga as the new prime minister after the surprise resignation of Shinzo Abe in August. This throws up several uncertainties and opportunities in the domestic and international spheres.

Suga, who replaces the longest-serving premier in Japanese history, announced a cabinet with familiar faces, thus suggesting a preference for continuation of existing policies rather than making large-scale changes.

However, Japan faces a host of uncertainties – a relentless coronavirus pandemic, an ageing and declining population, a slowing economy, and foreign policy complications in its neighbourhood owing to the US-China row and the stalemate in the Korean peninsula. At the same time, the change of guard could also serve as an opportunity to tweak strategies and push a new agenda that not only benefits Japan but other countries as well.

Abe abruptly announced his decision to step down in August due to a longstanding illness that has worsened. Abe’s term at the helm could have continued till October 2021, but his deteriorating health forced him to prematurely opt out of the political stage.

Abe’s legacy is characterised by his resolve to turnaround “two lost decades of economic and strategic drift”. His signature economic strategy – Abenomics – appeared to stabilise sagging growth, until the COVID-19 outbreak. Internationally, he ably managed the struggle to maintain a balance between Japan’s biggest trade partner – China – and its main security partner– the United States.

What sets apart the new leader is “his identity as a nonhereditary politician…from the roster of scions,” in Japanese politics. A farmer’s son, Suga rose through the ranks to become the cabinet secretary, the No. 2 position in the Japanese government.

While he is seen as a leader with good administrative experience, he is also regarded as being less skilled in guiding or managing specific ministries, particularly those responsible for economic, diplomatic and security affairs. This has raised doubts about his ability to tackle pressing domestic and international challenges.

After winning the leadership of the governing Liberal Democratic Party, the parliamentary vote confirmed Suga as the new prime minister. Suga quickly appointed a new “reform-minded” cabinet.

The new government’s priorities are the pandemic, despite it not being as widespread as in most other countries in the world, the worst economic downturn since the 1950s, a growing demographic crisis, hosting the Olympics, and diminishing technological competitiveness due to the rise of Chinese and South Korean industries.  

While these are tough domestic problems, Suga has the advantage of being able to drive forward the dynamic foreign and security policy reforms initiated by Abe. He has already vowed to continue several of Abe’s policies: easing constraints imposed by the pacifist post-war constitution, a process that began in 2015; advancing the ‘free and open Indo-Pacific region’ by partnering with others members of the Quad – the United States, India and Australia; and promoting the free-trade agreement called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

Some argue that a year is a long time in politics for Suga to prove his mettle. Others suggest that he could announce snap elections to seek a fresh mandate for a full term rather than risk failing over the next year and eventually losing the election.

With a nominal GDP of about $5 trillion, Japan is the third largest economy in the world. Though it did not grow as envisioned by Abe, his reign offered a period of political stability after 19 prime ministers were part of a ‘revolving door’ system over 30 years between 1982 and 2012. A new government now amid a struggling economy and the possibility of elections is not only a period of anxiety for the East Asian country, but also for other nations whose fortunes are intertwined.

The Gulf Cooperation Council countries and Japan have been important economic partners for several decades, chiefly in the energy sector. While the oil and gas sectors are still very important, Japan has diversified its bilateral relationship keeping in mind two factors – one, reviving its own economy; and two, the economic diversification programmes in the Gulf countries. Japan also attempted mediation between Iran and the United States to ensure stability in the Gulf region in 2019.

The UAE and Japan are robust partners in multiple sectors. The UAE is the second largest supplier of crude oil to Japan after Saudi Arabia. Some of the non-oil sectors of collaboration include trade, investment, renewable energy, infrastructure, healthcare, culture, tourism, and education.

Attempts to build partnerships in more ambitious sectors such as space technology, artificial intelligence, blockchain, fintech and other applications of the Fourth Industrial Revolution are under way. One such example was Japan facilitating the launch of UAE’s Mars probe in July. The UAE and Japan have also signed the ‘Comprehensive Strategic Partnership Initiative’ agenda, which most likely will continue to be the cornerstone of bilateral engagement even under the new leadership.