In the wake of a devastating defeat of the ruling Liberal Democratic Party in Sunday’s Upper House election, the business community Monday called on both the LDP and opposition parties to avoid a political vacuum and join forces to aid the nation’s ailing economy.

“Given the severe economic conditions of today, a political vacuum must be avoided at any cost,” Takashi Imai, chairman of the Japan Federation of Economic Organizations (Keidanren), said in a statement.

“We strongly hope that the ruling and opposition parties join forces to quickly deliberate and pass by the end of next month a series of bills for resolving the bad-loan problems and restoring the financial system,” he said.

Jiro Nemoto, president of the Japan Federation of Employers’ Associations (Nikkeiren), said priority must be given to ensuring political stability. “Any government delay in implementing necessary policies as a result of Sunday’s election and possible subsequent political turmoil would be the worst scenario for us, the business community,” he said.

To avoid such a situation, he said, both the ruling and opposition parties must disregard their petty differences in policy and work together to grapple with the difficult economic situation.

Fuji Bank Chairman Toru Hashimoto also said that passing the financial-stabilization measures is indispensable. Despite the LDP’s defeat, politicians should cooperate in clearing the necessary bills during the next Diet session, because the opposition camp is also aware of the importance of stabilizing the nation’s financial system, he said.

Business leaders say the election outcome is a clear indication of voters’ desire to change the nation’s politics and the economy. Commenting on the relatively high voter turnout, Jiro Ushio, chairman of the Japan Association of Corporate Executives (Keizai Doyukai), said, “There is still hope for Japanese democracy.

“Many people who usually do not support a particular political party went to vote, and it should be noted that those people voted against the LDP,” Ushio said.

Yotaro Kobayashi, chairman of Fuji Xerox Co., said the election results indicate a feeling of uncertainty is spreading among Japanese citizens. “The Japanese economy has come to a point where many Japanese voters strongly desire a change in politics,” Kobayashi said. “It means that people are not satisfied with the answer that the government has hammered out.”

Yukio Yanbe, chief economist at DKB Research Institute, pointed out the new government may offer greater tax reductions than those already proposed by the current government.

“The reshuffle will be within the scope of the LDP. So, it is unlikely we’ll see drastic policy changes under the new government,” Yanbe said. “But given the devastating result of the election, the LDP might be feeling an urge to make greater tax cuts.”

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