Japan’s political landscape is undergoing a significant change, potentially impacting trade negotiations with the United States.

On the morning of July 21, the counting of votes for the 27th Japanese Senate election came to a close. According to the final results tallied by Japanese media, the ruling coalition formed by the Liberal Democratic Party and the Komeito Party failed to secure more than half of the seats. In contrast, the National Democratic Party and other opposition parties are expected to see an increase in their respective seats.
This marks the first time since 1955 that the Liberal Democratic Party has lost its majority.
Prime Minister Yoshihide Suga expressed his intention to continue governing on the day of voting. He stated, “We must clearly recognize the responsibilities we bear towards the country, as well as the mission of the Liberal Democratic Party as the largest party in the Diet, and I will continue to fulfill my duties.”
This outcome is expected to have a significant impact on Japan’s political landscape. The future governing coalition will face significant obstacles in implementing policies. With both houses of Congress losing their majority, every government bill will have to yield to the opposition. This could lead to pressure from within the Liberal Democratic Party to remove Suga from office.
If the main opposition parties successfully form a governing coalition, Japan will experience a change of power. However, if a governing coalition cannot be formed due to policy differences, the existing governing coalition will continue to govern as a minority party.
Some scholars have pointed out that the Liberal Democratic Party has yet to produce a substantial policy on how to address the issue of rising prices.
A poll released by Japanese media at the end of June showed that Suga’s cabinet had a support rate of 24%, which has been in “dangerous waters” for four consecutive months. In Japanese politics, a cabinet’s support rate below 30% is considered entering “dangerous waters”; further drops below 20% are seen as entering “downfall waters.”
The governing coalition is a minority coalition, and it requires the support of the opposition, the Japan New Party, to pass budget bills, making it difficult to introduce other reform policies. This situation is attributed to the impact of the Liberal Democratic Party’s “black money scandal.” Additionally, Suga himself fell into the “commodity voucher” controversy after taking office.
In the first quarter of 2025, Japan’s GDP fell by 0.2% month-on-month, while the core consumer price index rose by 3.2% year-on-year, indicating ongoing inflationary pressures.
In this Senate election, how to respond to rising prices is the most pressing issue for voters. Moreover, the Trump administration continues to pressurize Suga’s government with trade negotiations. Trump has repeatedly criticized Japan for not buying American rice and cars, warning of an increase in so-called “reciprocal tariffs” (from 10% to 25%) against Japan.
Yoshihiro Noda, Japan’s chief negotiator, plans to visit Washington this week to continue negotiations, aiming to reach an agreement before August 1. The changes in this election mean that future Japanese governing authorities may find it challenging to convince enough legislators to support an agreement with the United States, especially in sensitive areas such as agriculture or automobiles.