Japan is preparing to choose a new Prime Minister after Shinzo Abe announced his premature resignation due to health problems. There are two main contestants for the office - Shigeru Ishiba and Yoshihide Suga, both of whom are members of Abe’s Liberal Democratic Party but with very different stances.
Ishiba is known for being opposed to Abe’s policies and will likely demand less dovishness from the Bank of Japan. Nevertheless, his chances of being chosen are not too great since many expect that the LDP will modify its selection process in a way that all but ensures Suga’s win.
Suga is seen as a good candidate who will continue the so-called Abenomics, supporting the Japanese economy with lots of stimulus measures to fight the deep recession the country is struggling with. The markets are generally in favor of Suga, with Japanese indices increasing on the prospect of Suga serving as the next Prime Minister.
In other resignation-related news, the director-general (DG) of the World Trade Organization, Roberto Azevedo, is also leaving his position. It is not yet clear who will replace him, and the process of choosing a new leader could take months.
Now is an especially bad time for the WTO to be left without an official leader because the US and China are still at each other’s throats. The EU and the UK have not negotiated an agreement either, which could pose another trade issue come 2021. Some experts speculate that the WTO might even wait out the US presidential elections before choosing a leader of its own.
Speaking of the US-China trade dispute, Donald Trump has not gone back on his executive order which stated that TikTok will be banned in the United States unless it is sold to a US company within a short deadline.
Nevertheless, China passed a new law that would require any such deal to be approved by the government in order to protect Chinese intellectual property. This means that TikTok will most likely not be sold to a US company.
