Kan pledges closer ties with US
Published: Jun 5, 2010 00:15 Updated: Jun 5, 2010 00:15
TOKYO: Former Finance Minister Naoto Kan became Japan’s new premier on Friday, pledging economic recovery and close ties with Washington after his predecessor quit amid a damaging dispute over a US air base.
A parliamentary vote confirmed Kan as successor to Yukio Hatoyama, who tearfully resigned as prime minister Wednesday, citing the row over the base on Japan's Okinawa island and financing scandals that had sullied his government.
Kan, a former leftist activist, is Japan's fifth premier in four years, and the first in over a decade not to hail from a political dynasty.
“What I want to tell voters in the upper house election is that our reforms are becoming more concrete,” Kan said in his first news conference as prime minister-elect.
“The hopes voters had for the Democratic Party are not just ending up as a mere dream. They will be realized. That's what I want people to know for the election.”
Kan’s rise to the top job and his expected new Cabinet line-up could spell bolder steps ahead to rein in a public debt that is already twice the size of the economy, but he will face opposition from many in his party ahead of the election.
Hatoyama, his voter ratings in tatters, resigned on Wednesday just eight months after the Democrats swept to power pledging to cut waste, wrest control of policy from bureaucrats, and give consumers more cash so as to stimulate domestic demand. His abrupt departure has raised concerns among investors that the government will delay efforts to thrash out plans, due this month, to cut public debt and craft a growth strategy. Financial market players generally welcomed Kan as Japan's next leader. His selection improves the ruling bloc's prospects at the polls, though many wondered how much would change.
“If Hatoyama had remained the party would have had a big loss at the election and the political situation would have been chaotic,” said Hiroyuki Nakai, chief strategist at Tokai Tokyo Research.
“But with Kan in charge now, the sense of stagnation in politics and the economy is receding somewhat, even though much will depend on the makeup of the Cabinet.”
Kan, a former health minister who got his start in politics as a grassroots activist, has forged an image as a fiscal conservative and occasional central bank critic since assuming the finance post in January. He was among the few Cabinet ministers to urge early debate on raising Japan's 5 percent sales tax, a step economists say is vital to fund the huge social welfare costs of a graying society.
But on Friday, Kan dodged a question on the sales tax, saying he would state his stance after forming his Cabinet on Tuesday, when he will be sworn in. Kan was likely to pick a fiscal reformer, Deputy Finance Minister Yoshihiko Noda, as his finance minister, a move that would be welcome for bond markets worried about too much debt.
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MILO
Jun 6, 2010 02:27
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