Japan's former internal affairs minister Sanae Takaichi delivers a speech at the kick-off of the campaign for the LDP presidential election in Tokyo, Japan, September 22, 2025. Franck Robichon/Pool via REUTERS

By Tim Kelly and Joseph Campbell

TOKYO (Reuters) -Japan stands a good chance of having its first woman prime minister or its youngest leader in the modern era after a vote on Saturday to pick the head of the nation’s ruling party.

The front-runners in the potentially historic Liberal Democratic Party election are conservative nationalist Sanae Takaichi, 64, and her more moderate rival Shinjiro Koizumi, 44. Opinion polls suggest Cabinet Secretary Yoshimasa Hayashi, 64, may also be a contender.

They are among five candidates vying to replace Prime Minister Shigeru Ishiba, who is stepping down after a series of electoral defeats.

The next leader is likely to become premier as the LDP is the biggest group in parliament, but that is not assured as the party – which has run Japan for almost all the postwar period - lost its majorities in both houses under Ishiba.

RULING PARTY IN CRISIS

Takaichi pledges to jolt the economy with aggressive government spending that could spook investors in an economy with one of the world's biggest debt loads. She has raised the possibility of redoing an investment deal with U.S. President Donald Trump that lowered his punishing tariffs.

Farm minister Koizumi, son of former premier Junichiro Koizumi, as well as the other candidates, say they would trim taxes to help households cope with rising living costs but otherwise hew more closely to Ishiba's economic restraint.

Whoever wins Saturday's vote will inherit a party in crisis and a sluggish economy.

Dissatisfaction with the LDP is pushing many voters, especially disillusioned younger people, to opposition parties such as an upstart anti-immigrant far-right party.

"Koizumi and Takaichi offer two quite different approaches to that renewal," said Tina Burrett, a political science professor at Tokyo's Sophia University. Koizumi is seen as someone who could forge consensus with other parties while Takaichi would shake up "a world of rather grey politicians", she said.

If chosen, Koizumi would be a few months older than Hirobumi Ito when he became Japan's first prime minister in 1885, under the nation's prewar constitution.

LAWMAKERS VS RANK AND FILE

Koizumi leads among the 295 LDP lawmakers who will vote for party leader, followed by Hayashi and Takaichi, according to an Asahi newspaper report on Wednesday. But Takaichi is ahead of both of them among rank-and-file party members who will get an equal number of votes in the first round on Saturday, a Nippon Television survey found.

If, as seems likely, the election goes to a second round, the advantage could shift as the vote of grassroots LDP members would fall to 47.

Takaichi, an ally of assassinated former Prime Minister Shinzo Abe, has the most expansionist economic platform of the LDP candidates. She has promised to double the size of the economy in a decade with heavy state investment in new technologies, infrastructure, food production and other areas of economic security.

She has said she would carry over Ishiba's trade agreement with Trump, in which Japan agreed to invest $550 billion in the U.S. in return for lower tariffs on automobiles and other Japanese products, but mentioned the possibility of renegotiation if the deal proves to be unfair.

Cabinet ministers Hayashi and Koizumi have defended the deal.

For whoever wins, one of their first acts as premier is expected to be hosting Trump in Tokyo at the end of October, Reuters has reported.

Domestically they face the tall task of rejuvenating a party increasingly seen as out of touch with voters, said James Brown, a politics professor at Temple University in Tokyo.

"There's every possibility that we'll be returning to this issue of yet another election for the leadership of the country before too long," Brown said.

(Reporting by Tim Kelly and Joseph Campbell; Editing by John Geddie and William Mallard)