Japan’s turbulent times

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It's shaping up to be a rocky weekend for Japanese Prime Minister Shigeru Ishiba.

Still bruised from a general-election humiliation last October, he's now barreling into an upper-house vote this Sunday with approval ratings scraping 20%. His coalition is on the verge of losing its majority, while he struggles to clinch a trade deal with the US.

US Treasury Secretary Scott Bessent with Shigeru Ishiba in Tokyo today. Photographer: Shuji Kajiyama/AP Photo/Bloomberg

The ruling Liberal Democratic Party is still likely to remain the largest party, and Ishiba might yet win the 50 seats needed for a majority.

But another election loss could spell the beginning of the end for him.

Japan's opposition parties — long divided and squabbling — may finally find common ground to pass a no-confidence vote. If that happens, Ishiba would be backed into a corner, forced to step down with his cabinet or dissolve parliament altogether.

He could also bow out before things get ugly, setting off a scramble within the LDP for a successor, with the usual suspects such as Sanae Takaichi and Shinjiro Koizumi likely to vie for the top job.

Shinjiro Koizumi on a visit to rice farmers in Ibaraki Prefecture, on July 9. Photographer: Soichiro Koriyama/Bloomberg

Any such scenario would throw Ishiba's policy agenda into disarray days before an Aug. 1 deadline for US tariffs to kick in.

Despite months of talks, there's little expectation of any breakthrough despite Treasury Secretary Scott Bessent's current visit to Japan.

Markets are alive to the risks. The possibility of Ishiba's coalition losing its majority has spooked investors already, sparking a jump in bond yields amid increasing concerns over government spending.

Defeat could lead to a triple hit to Japanese bonds, stocks and the yen, reflecting growing worries over the mounting debt burden in a country with an aging society whose birth rate is among the lowest in the world.

Either way, Japan is facing what looks like an extended period of turbulence. — Sakura Murakami

Ishiba departs a news conference in Tokyo on June 23. Photographer: Kiyoshi Ota/Bloomberg

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And Finally

Along Myanmar's 1,300-mile border with China, a town called Pangwa sits in a small valley, surrounded by forested peaks. For years, an aging warlord controlled the outpost, allowing farmers to grow opium poppies as long as they paid taxes. In the mid-2010s, southern Chinese workers came in search of rare earths that are crucial to dozens of modern technologies, carving pools into the terraced slopes that soon filled with a stew of chemicals. In 2024, Pangwa fell to the Kachin Independence Army, which now controls most of the rare-earths mines in Myanmar, the world's biggest source of the metals after China and the US.

New tanks at a mine near Myanmar's border with China. Source: Bloomberg

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