TOKYO — Japanese Prime Minister  (PM) Fumio Kishida said he will step down in September, ending a three-year term marred by political scandals and paving the way for a new premier to address the impact of rising prices.

“Politics cannot function without public trust,” Mr. Kishida said in a press conference on Wednesday to announce his decision not to seek re-election as the Liberal Democratic Party (LDP) leader.

“I will now focus on supporting the newly elected LDP leader as a rank-and-file member of the party,” he said.

His decision to quit triggers a contest to replace him as president of the party, and by extension as the leader of the world’s fourth-biggest economy.

Mr. Kishida’s public support has been sliding amid revelations about the LDP’s ties to the controversial Unification Church and political donations made at party fundraising events that went unrecorded.

But he also faced public discontent over the failure of wages to keep track with the rising cost of living as the country finally shook off years of deflationary pressure.

“An LDP incumbent prime minister cannot run in the presidential race unless he’s assured of a victory. It’s like the grand champion yokozunas of sumo. You don’t just win, but you need to win with grace,” said Koichi Nakano, political science professor at Sophia University.

Who ever succeeds Mr. Kishida as the head of the LDP will have to unite a fractious ruling group and tackle the rising cost of living, escalating geopolitical tensions with China, and the potential return of Donald Trump as US president next year.

COVID TO INFLATION
As the country’s eighth-longest serving post-war leader, Mr. Kishida led Japan out of the COVID pandemic with massive stimulus spending. He also appointed Kazuo Ueda as head of the Bank of Japan (BoJ), an academic tasked with ending his predecessor’s radical monetary stimulus.

The BoJ in July unexpectedly raised interest rates as inflation took hold, contributing to stock market instability and sending the yen JPY — sharply lower.

Mr. Kishida’s departure could mean tighter fiscal and monetary conditions depending on the candidate, according to Shoki Omori, chief Japan desk strategist at Mizuho Securities in Tokyo.

“In short, risk-assets, particularly equities, will likely be hit the most,” he said.

In another break from the past, Mr. Kishida also eschewed corporate profit-driven trickle-down economics in favor of policies aimed at boosting household incomes, including wage hikes and promoting share ownership.

DEFENSE SPENDING
Despite that departure on the economy, he stuck with the hawkish security policies of predecessor Shinzo Abe, who was assassinated in 2022.

He unveiled Japan’s biggest military buildup since World War   II with a commitment to double defense spending aimed at deterring neighboring China from pursuing its territorial ambitions in East Asia through military force.

With prodding from Washington, Mr. Kishida also mended Japan’s strained relations with South Korea, enabling the two countries and their mutual ally, the U.S., to pursue deeper security cooperation to counter the threat posed by North Korea’s missile and nuclear weapons programs.

“Under Prime Minister Kishida’s steadfast leadership, Japan and the United States have ushered in a new era of relations for the Alliance,” US Ambassador Rahm Emanuel said in a post on X, formerly known as Twitter. — Reuters

TORONTO — Canada’s temporary foreign worker program is not fatally flawed but is “in need of reform,” the country’s immigration minister told Reuters on Tuesday, following a damning United Nations (UN) report that dubbed the program a breeding ground for modern slavery.

The program brings non-Canadians to the country to work on a temporary basis. Ostensibly meant to fill labor shortages, it has grown dramatically and has come under fire for suppressing wages and leaving workers vulnerable to abuse.

The low-wage temporary foreign worker stream, especially, “is one that we need to take a more careful look at,” Immigration Minister Marc Miller said.

Its ranks have grown dramatically — from 15,817 in 2016 to 83,654 in 2023, thanks in large part to expansions in 2022.

Among other things, these expansions increased the share of employers’ workforces that could be low-wage temporary foreign workers, and the change waived a rule precluding the hiring of temporary foreign workers in certain low-wage occupations in regions with unemployment rates of 6% or higher.

Labor Minister Randy Boissonnault is considering “a refusal to process in the low wage stream if the abuse and misuse does not improve,” said labor ministry spokesperson Mathis Denis.

But “even when the program is working as intended and there’s no abuse, the low-wage stream absolutely suppresses wages. It’s kind of designed to,” said economist Mike Moffatt, senior director at the Smart Prosperity Institute.

If it were up to him, he said, he would end the low-wage stream entirely. “I don’t think employers have some constitutional right to low-wage workers.”

The United Nations Special Rapporteur on contemporary forms of slavery said in a report last week that Canada’s “Temporary Foreign Worker Program serves as a breeding ground for contemporary forms of slavery.”

Problems cited included underpayment and wage theft and physical, emotional and verbal abuse. The report also noted that workers struggle to access healthcare.

Reducing the number of temporary residents, as Canada plans to do, will not address problems making these migrants vulnerable, the special rapporteur found.

“The structural precarity for temporary foreign workers would be mitigated by systematically providing workers with a pathway to permanent residence,” the report said.

Mr. Miller called the slavery characterization “inflammatory.”

“It’s not to deny the allegations in some of the cases that are occurring and abuses that are occurring in Canada … It’s not right when there are abuses, and there are abuses.”

But “I think it’s unfair to employers that employ people and treat them well to call them the equivalent of slave owners.” — Reuters

WASHINGTON — Vice President Kamala Harris’ presidential campaign said it was notified by the Federal Bureau of Investigation (FBI) last month that it was “targeted by a foreign actor influence operation,” a campaign official said on Tuesday.

“We have robust cybersecurity measures in place, and are not aware of any security breaches of our systems resulting from those efforts,” the official said, adding that the campaign remains in communication with authorities.

The FBI did not immediately respond to a request for comment.

The bureau said on Monday that it was investigating after Republican rival Donald Trump’s presidential campaign said that it had been hacked.

The Trump campaign blamed Iran and pointed to a Friday report from Microsoft  researchers that indicated that Iranian government-tied hackers tried breaking into the account of a “high-ranking official” on a US presidential campaign in June.

The Iranian government has denied hacking the Trump campaign. — Reuters