Japan's Bold Stewardship
“It’s the economy, stupid.” Ever since campaign strategist James Carville coined the famous quip that helped elect Bill Clinton president in 1992, it has become a powerfully simple litmus test for the chances of a political incumbent winning re-election—not just in the United States, but also globally. Case in point: Japanese Prime Minister Shinzo Abe’s strong re-election victory this past weekend.
Abe’s win in the specially-called election means that he will remain Japan’s leader until at least next year and most likely into 2021, which would make him the country’s longest-serving prime minister. Such tenures are rare, of course, but are especially remarkable in today’s age, when leaders of governments—not to mention Fortune 500 companies—are routinely removed.
But there is still is a formula for keeping the top job: producing results, which in this case has been the country's economic turnaround. Also critical, according to Korn Ferry’s Yukihiro Koshiishi, is offering a clear agenda. “What we learned here is the real leader is not necessarily a populist, but someone with a clear message and agenda,” says Koshiishi, a senior client partner in the Tokyo office.
For Abe, the economic results came in the form “Abenomics,” the policy platform that helped sweep him into office in 2012. Morgan Stanley analysts wrote in a research note ahead of the election that the strong performance of the Nikkei, the Japanese stock market, suggests that the country’s “economic upswing may be in better shape than widely perceived.”
Abe has been able to lead Japan to economic growth despite demographic and sociological trends that normally would portend a decline. Japan’s population is estimated to fall from 127 million currently to 88 million by 2060. Further, roughly 40% of those people will be older than 65. Yet the Nikkei is at a 20-year high, Japanese-based companies like Toyota and Panasonic are posting stellar results, and exports are expanding at their most rapid rate in years. The growth in exports is directly tied to Abe’s conscious efforts to position himself and his country as partners to global business.
Still, Abe’s economic leadership—as well as his plan to change the country’s constitution—will face some challenges before the next election in 2019. “There is an Abe conundrum,” Jeff Kingston, the director of Asian studies at Temple University in Tokyo, told The New York Times. Abe is a candidate “who is basically unpopular with voters, whose policies are not particularly popular, who doesn’t get high marks for leadership, and yet he keeps winning in elections,” Kingston said.
Why? As Koshiiki sees it, “the Japanese people believe his results lead to action.”