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What explains change and continuity in Japan's economic statecraft? This Element examines the interplay between factional dynamics in the Liberal Democratic Party (LDP) and Japan's foreign policy through two cases: Japan's unprecedented decision to impose severe sanctions on Russia following its 2022 Ukraine invasion, and its decades-long ASEAN strategy amid political uncertainty and great power competition. The authors find that factional balance or the outsized influence of a large faction facilitates abrupt political-economic shifts, sustained until a similar dynamic triggers correction. Unlike most systems, Japan's intra-party politics do not lead to full leadership turnover, enabling factions to influence policy while empowering non-leadership members to drive change. This dual role strengthens barriers to change, embedding political inertia. Using factional membership data from 1961 to 2024, they argue that factions are a more systematic unit of analysis than political entrepreneurs in understanding the relationship between Japan's domestic politics and foreign policy decisions.