Scandal will worsen Japanese government's prospects

Significance

In addition, the three most senior Liberal Democratic Party (LDP) executive officers, including policy chief Koichi Hagiuda, have tendered their resignations. They will be replaced, although Hagiuda will stay on until the budget draft is finalised.

Impacts

• Kishida will attempt to restore public confidence in the LDP and government until the Diet reconvenes in mid-January.
• A more united opposition has backed motions of no confidence against the government, potentially enabling further election cooperation.
• Kishida will try to strengthen controls on party finances and regain political control but he looks unlikely to succeed.
• The developments will strain ties between the LDP and its coalition partner, the Komeito, which will want to avoid reputational fallout.