After weeks of political manoeuvring and internal party turbulence, Japan’s ruling Liberal Democratic Party (LDP) has chosen Sanae Takaichi as its new leader, setting her on course to become Japan’s first female prime minister. Her victory marks not only a symbolic break in Japan’s patriarchal political order, but also a return to a more hard-line, national security-driven posture - especially toward Beijing.

Takaichi’s ascent comes amid a period of acute disruption for the LDP. In 2024, her centrist rival Shigeru Ishiba had won the party leadership, edging her out in a run-off, only to preside over a rough electoral cycle. The LDP and its coalition partner Komeito lost their majority, forcing Ishiba to cling on to power for as long as he could.

By the middle of this year, however, mounting internal pressure and a plunging popularity rate forced Ishiba to announce his resignation as party leader and thus prime minister. That in turn opened the door to a new leadership contest, and one pitting Takaichi as representing the LDP’s more right leaning of members, against the more middle-of-the-road contenders.

As a result, Takaichi prevailed over Agriculture Minister Shinjiro Koizumi, in a victory greeted by a notable rally in financial markets: Japan’s Nikkei index leapt 4.5 %, reflecting investor expectations of renewed fiscal stimulus and continuity with the pro-business policies of Shinzo Abe’s era.

That Takaichi was at various times described as an heir of Abe is a fact not lost on many Japanese voters.

She held a number of important posts during Abe’s period as prime minister, serving most notably as Minister for Internal Affairs and Communications. More recently she served as Minister of State for Economic Security under then-PM Fumio Kishida.

And on October 15, she will be confirmed as Japan’s next prime minister.

Aged 64, Takaichi has long been associated with Japan’s staunch conservative wing. She openly cites Margaret Thatcher as a source of inspiration: strong character, conviction, and national resolve tempered by “womanly warmth” multiple sources in the British media have pointed out over the weekend.

At home, her domestic and economic agenda is not too dissimilar to that of Thatcher and leans toward a revival of Abenomics which saw a mix of fiscal stimulus, tax cuts, and monetary easing with the ultimate goal of of jump-starting growth in Japan, while at the same time controlling deflation, and most importantly appearing to reach out to the LDP’s core backers.

Yet Takaichi’s more contentious territory lies in defence, security, and especially foreign policy.

She is an outspoken advocate for revising Japan’s postwar pacifist constitution and formalising the role of the Self-Defense Forces as a military force Reuters and the FT have reported.

She has also referred to a Taiwan emergency – should China invade – as a Japan emergency.

That the original Iron Lady from Grantham in Lincolnshire, stood firm against an Argentine threat when the Falkland Islands were invaded in 1982, and ordered a task force to go and liberate the islands will not be lost on Japan’s new Iron Lady over the issue of defence of Taiwan – itself a former Japanese territory and a hugely popular holiday spot for modern day Japanese.

Similarly galling to China, Takaichi is said to be a regular visitor to Yasukuni Shrine, which, given its enshrinement of Japan’s war dead, including a number of convicted war criminals, is seen as a political slap in the face by Beijing.

More specifically on the subject of China, Takaichi’s posture is markedly hawkish. She has repeated criticisms of Beijing’s regional assertiveness and has urged Tokyo to take a tougher line on issues ranging from Taiwan to the East China Sea, and is expected to follow up on her political leanings despite Politico earlier in October saying Takaichi “called herself a “moderate conservative” during the run-up to the election.” 

To say Takaichi’s time as prime minister of Japan could lead to rising tensions with Beijing would, long-time Japan watchers have already noted, be a major understatement.

And while at home she must face economic pressures centred on inflation, stagnating wages, and an ageing demographic, on the foreign affairs front, Takaichi will need all the diplomatic nimbleness she can muster, especially as US–Japan ties work to take a tougher stance on China.

Her inclination toward Taiwan has already been noted on the island and welcomed by many.

Beijing has as expected already reacted cautiously, calling her election an internal Japanese matter while urging Tokyo to honour previous commitments on issues including history - and Taiwan - according to the SCMP; China-speak for ‘don’t rock the boat on issues directly affecting Chinese claims over the already independent and self-governing island’.

To this end, Takaichi’s election and her attitude towards China in recent years places Tokyo at a sensitive diplomatic inflection point. How she calibrates assertiveness and restraint vis-a-vis China in the coming months will test Japan’s ability to maintain strategic balance between Washington and Beijing

For now though, the biggest winner in Sanae Takaichi coming to power is Taiwan.