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Japan Suffers Setback With Olympics Delay, But Abe May Still Benefit

Japan Suffers Setback With Olympics Delay. It Still Won’t Topple Abe

(Bloomberg) --

Becoming the first world leader to postpone the Olympic Games could’ve been a disaster for Japanese Prime Minister Shinzo Abe. In a world transformed by the coronavirus, it might play to his advantage.

Abe and International Olympic Committee President Thomas Bach agreed Tuesday to put off the Tokyo Games for about a year, the first such delay since the modern multisports event began in the late 19th century. The decision not only means disappointed participants and increased costs, it also deprives Abe -- who once dressed up as Super Mario to promote the event -- of an opportunity to showcase his efforts to overhaul the Japanese economy.

Postponement began to seem inevitable as the Covid-19 outbreak prompted lockdowns around the world and Abe was increasingly faced with a choice between delaying the games or watching them collapse. Now, the decision frees him to call an election when he sees fit -- potentially as soon as this summer -- with the ruling Liberal Democratic Party’s support holding steady and the opposition mired in disarray.

“It will be to his immediate benefit to have made the decision and be seen to be a responsible figure,” said David Leheny, a politics professor at Waseda University. Abe has avoided having a “depressing,” poorly attended event, Leheny said.

The move to postpone the world’s premier international sporting event is just one of the many once-unimaginable decisions politicians are confronting as the coronavirus tightens its grip on the globe. Besides bringing a flood of tourists to support Japanese businesses, the post-Olympic euphoria would’ve given Abe an ideal time to name a successor and leave office on a high note.

With that option off the table, he can now consider calling an election earlier -- provided he can keep Japan’s case numbers low enough to ensure voting is safe. The one-year delay comes as Abe is looking at whether to invoke an emergency declaration that would allow for stronger containment measures against the virus, actions that once might have undermined confidence in Tokyo’s ability to host the Olympics in July.

“He’s lost the opportunity to go out with a bang,” said Steven Reed, an emeritus professor of political science at Chuo University.

The postponement of both the Olympics and Paralympics opens up a six-week period in Abe’s summer schedule -- enough time to call an election that must be held by the autumn of 2021. And while the virus’s ability to spread among crowds could make campaigning difficult, Abe’s ability to time elections to his advantage has been seen as one of the reasons why he’s now Japan’s longest-serving prime minister.

Abe’s handling of the pandemic has regained some public trust, as outbreaks in other countries such as Italy, South Korea and the U.S. eclipsed the problem in Japan. While Abe’s support rate slipped last month amid scandals and missteps in the early handling of the coronavirus, most polls now show it steadying.

A poll carried out by the Yomiuri newspaper March 20-22 found Abe’s support was at 48%, virtually flat on the previous month. Approval for the LDP fell to 35%, from 40% in February, but still far ahead of the most popular opposition party, the Constitutional Democratic Party on 5%.

Abe also won support from Japan’s two biggest economic partners. U.S. President Donald Trump said in a phone call with Abe that it was an excellent decision to postpone the games and Chinese foreign ministry spokesman Geng Shuang told reporters in Beijing the move “reflects the IOC, the Japanese government, and the Tokyo organizing committee’s responsible attitude on the health and security of athletes, participants and all human beings.”

Risks abound in the coming months for Japan, which, like its peers in the U.S., Singapore, and elsewhere, will struggle to time the election around the hard-to-track and still mysterious new disease. And any spike in infections could prompt more debate about the relatively relaxed policies and low levels of testing pursued by Abe’s government so far.

Critics contend Japan hasn’t done enough testing to gain an accurate picture of the virus’s spread. They worry about a fresh wave of infections as the government allows some schools to re-open next month just as many nations are going into lockdown.

Tokyo Governor Yuriko Koike -- a one-time Abe rival -- warned this week that she might be forced to declare an emergency in the capital if cases continued to rise. Campaigning and voting under those circumstances would be difficult, if not impossible.

The slump in economic activity will also damage the high levels of employment the 65-year-old premier has claimed as a key achievement of his so-called Abenomics program. A gauge of Japan’s service sector activity slumped to a record low this week, in an economy that already shrank by an annualized 7.1% in the last quarter of 2019, sparking fears of a deep recession. Tumbling financial markets threaten to undermine the public pension system in one of the world’s most elderly countries.

“There could be a cavalcade of pretty bad stuff coming down the pike,” said Leheny. “So many prime ministers have gotten toppled in the past when their popularity goes below 30% or so.”

©2020 Bloomberg L.P.