Japan’s parliament confirmed Shinzo Abe as prime minister today, giving him the opportunity to become the longest-serving premier in four decades.

After last week’s sweeping election win, Abe is in a position to push ahead in 2015 with reflationary policies to reboot an economy that has slipped into recession. He will also seek to pass a raft of bills to toughen the country’s defense stance, while trying to build on signs of a tentative rapprochement with neighbors China and South Korea in a year that marks the 70th anniversary of Japan’s World War II defeat.

“We must sense this historic duty and press on firmly with our policies to recreate a strong Japan,” Abe told a meeting of ruling Liberal Democratic Party lawmakers earlier today. “The road ahead will not be smooth. Tough problems are waiting for us.”

Abe faces resistance both from within his ruling Liberal Democratic Party and the public on policies such as nuclear restarts, his push to join a regional trade agreement and legislation to fortify the nation’s defense. For the 60-year-old leader facing local elections in April and a party leadership vote in September, the order in which he tackles unpopular policies may prove crucial.

“It won’t be so easy for Abe to pursue his agenda,” said Mari Miura, a professor of political science at Sophia University in Tokyo. “He’ll probably introduce all the controversial bills after the local elections,” she said.

Abe made the economy the focus point of the Dec. 14 election, claiming his victory as a mandate for his “Abenomics” policies of unprecedented monetary easing, public spending and structural reforms to make business more competitive.

Since Abe came to power in December 2012, the yen has slumped about 30 percent against the dollar, helping the benchmark Topix index climb more than 75 percent as big companies such as Toyota Motor Corp. earn more from exports.

On the flip side, the weak yen has hurt smaller firms and nascent inflation has caused real incomes to fall for 16 straight months -- hitting household budgets already hurting from a sales-tax increase in April.

Despite the contrasting impact of Abenomics, the election win gave Abe a mandate to forge ahead with his economic policies from a longer-term perspective, according to Barclays Plc.

“This should allow the ruling parties to move beyond fiscal and monetary stimulus toward more difficult decisions on taxes and expenditures to consolidate public finances and deregulation to boost potential growth,” Barclays analysts led by Kyohei Morita wrote in a Dec. 19 note. Even so, it may be difficult to expect much progress on the growth measures in the first half of next year because of the focus on taxation and security legislation, they said.

Stephen Nagy, an associate professor at International Christian University in Tokyo, sees political difficulties in making progress on Abe’s growth strategy -- his so-called third arrow.

“I’m not confident that he will be able to rein in the political factions within the party to move forward on real and meaningful structural reform,” Nagy said. “He will need to demonstrate skill, courage and cunning to deal with” lobbies in the agriculture and medical sectors, he said.

A July reinterpretation of the U.S.-imposed pacifist constitution to allow Japan to defend other countries has sparked public opposition, and Abe this year delayed the submission of a raft of bills needed to put the policy into practice.

The timing of the legislation is crucial. Too soon, and the LDP may suffer a backlash in April’s local elections. Too late, and he risks antagonizing the U.S. -- Japan’s only formal ally.

“Abe’s government needs to deliver on the promises they made in the context of bilateral alliance management with the United States,” said Yuki Tatsumi, senior associate at the Stimson Center in Washington. The legislative package should be submitted no later than late spring as the two countries are completing revisions to bilateral defense guidelines, she said.

Careful handling of a statement Abe plans to make to mark the anniversary in August could help sooth regional tensions over Japan’s attitude to past aggression, while the situation could deteriorate should he make any missteps.

“There is already a high level of concern that the statement Abe said he intends to issue will be the one that reflects the revisionist views of Japan’s wartime past,” Tatsumi said. “His biggest challenge will be to dispel such concern, and assure everyone both inside and outside Japan that Japanese diplomacy under his watch will be firmly rooted in Japan’s postwar identity as a ’peace-loving nation’.”

The Trans-Pacific Partnership, a U.S.-led trade agreement, will be pushed as an important policy in the first three or four months of 2015, said ICU’s Nagy, who added it depends on domestic politics in both Japan and the U.S.

“If Obama gets the fast track negotiating status, factions within the LDP will be forced to compromise with Abe on reform to make the agreement a reality,” Nagy said. “Groups can stall and cause headaches for Abe with the argument that why should they compromise now when Obama doesn’t have authority to negotiate.” (Bloomberg)