Hello from Tokyo. Japan's ruling Liberal Democratic Party began a two-week campaign yesterday to elect its next leader to replace Prime Minister Fumio Kishida. Polls have already shown who is the stronger candidate, but it is more difficult than ever to predict who will win among the nine candidates, as the breakdown of most factions within the party has complicated the calculation.
Prime Minister Kishida is less and less in the spotlight, but admittedly under his leadership, the Nikkei Stock Average has reached record highs and the economy is finally on the verge of emerging from decades of deflation. To some extent, these may be among the achievements by which we will remember the Kishida government.
With these milestones in mind, this week's Big Story explains how Japanese companies are making big changes in their behavior. Businesses once unwilling to part with their valuable real estate are now taking an “asset-lighting” approach, selling non-core properties to free up capital to reinvest in areas such as digital infrastructure.
The shift, driven by pressure from global investors and institutions such as the Tokyo Stock Exchange, reflects a broader drive to improve profitability and efficiency. Major foreign investors such as Blackstone and Bain Capital are benefiting from moves by Japanese companies – from rail operators to manufacturers – to rethink their long-term real estate strategies.
Corporate behavior—and especially the need to change it—is also a hot topic in South Korea, where a fire at a lithium battery factory has reignited debate about the balance between economic growth and worker safety. This week's Business Spotlight in our magazine looks at how the country's new Serious Accident Penalties Act is shaking up the corporate landscape, making CEOs personally liable for workplace accidents and increasing pressure on companies to prioritize safety over speed.
Meanwhile, India is considering controversial policy changes to make it easier to welcome Chinese investment. Our Asia Insight feature discusses the potential benefits and risks of this change, highlighting how easing restrictions could boost manufacturing capacity and help address a growing trade imbalance with China. The debate highlights the delicate balance New Delhi must strike between promoting economic growth and protecting national security interests.
India is also the subject of our Tea Leaves column in this week's magazine. The country's traditional tea stalls have long served as places where people gather to talk about everything from sports to politics. Let these kiosks be the iconic tea sometimes Tamil Nadu or jadoh dukans Meghalaya serves as vibrant community hubs where conversation flows as freely as a river.
I wish you a wonderful weekend!
Shin Nakayama
Editor-in-chief, Nikkei Asia
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