Japan prepares to elect another new leader as clouds hang over the economy.

Live from the UK, this is the Marketplace Morning Report from the BBC World Service.

I'm William Lee Adams. Good morning.

Japan's ruling Liberal Democratic Party will choose a new leader on Saturday,

and he or she will become the country's next prime minister.

Five lawmakers are in the race, and the economy is top of the agenda.

The BBC's Asia business correspondent Surinjana Tawari joins us now from Singapore.

Sir Unjana, hi.

Hello.

We know voters in Japan are unhappy with the economy.

What's going on?

Japan's economy faces a number of challenges,

not to mention the geopolitical issues, especially because of the US-China trade war and because

of Trump's tariff chaos. But internally, Japan is actually facing rising inflation,

which is unusual for the economy because historically Japan has often actually had

deflation. Now it's facing inflation rising and that's really affecting politics because voters

are so unhappy about the rising cost of living and there's just not that wage growth to match it.

How close is the rest of the world watching this election?

They are watching because Japan geographically is in a very important place.

The supply chains run all the way through Asia. It's also a big consumer market.

So all those phones and laptops that are being made in this part of the world are being sold there as well.

It has very close relations with the US, which is the world's largest economy, which is another huge consumer market. And remember that throughout this

...