Related topics

Japan’s Ex-PM May Take Finance Post

July 28, 1998

TOKYO (AP) _ A former premier and ruling party economics expert was reportedly ready to accept the job as Japan’s finance chief today, news that triggered a rally in Tokyo markets and boosted efforts by incoming Prime Minister Keizo Obuchi to piece together a Cabinet this week.

Former Prime Minister Kiichi Miyazawa, considered a top Liberal Democratic Party financial specialist, had been reluctant to take over the reins of the powerful Finance Ministry on the grounds that he was too old.

But concerns over Japan’s severe economic crisis persuaded Miyazawa, 78, to accept the post, Kyodo News reported today. The position is considered instrumental in efforts to lift Japan out of recession and restore stability to the ailing banking system.

The news that Miyazawa was being tipped as finance minister was welcomed by Japan’s gloomy financial markets, with the benchmark Nikkei stock average gaining more than 1 percent and the yen gaining ground against the dollar.

``Miyazawa’s not the best answer, but compared to the other candidates, he’s the best,″ said Takashi Nakauchi, foreign exchange manager at Bank of Tokyo-Mitsubishi.

Foreign Minister Obuchi, who won the LDP presidency last week and is expected to be voted prime minister Thursday in Parliament, reportedly has been lobbying Miyazawa himself to accept the finance job.

The choice is a crucial one. The country is facing its worst recession in decades, with record-high unemployment, increasing bankruptcies, and a financial system weighed down by mountains of bad debt.

But Japan’s tortuous path to economic recovery could turn the finance portfolio into a political minefield. Anyone who takes the job can expect to come under intense criticism if the economic crisis worsens.

Miyazawa, who has served as finance minister in the past, is a main architect of Japan’s efforts to reform its banking system. Many consider his economic expertise essential to counterbalance Obuchi’s relative inexperience in the field.

The former Japanese premier also has cultivated strong relations with top finance officials in Washington.

Many other leading candidates reportedly have balked at overtures to take up the post _ once considered the most desirable in the Cabinet outside the premiership itself.

Another possible candidate, Koichi Kato, former LDP secretary-general, has said he can’t take the job because of his responsibility for the LDP’s defeat in elections to the upper house of Parliament earlier this month, the newspapers said.

That electoral humiliation forced Prime Minister Ryutaro Hashimoto to announce his resignation, which led to Obuchi’s election as party president.

Analysts said that Kato’s refusal may indicate that he is protecting his reputation as he grooms himself to become prime minister sometime in the future.

The third candidate Obuchi has been considering, former Chief Cabinet Secretary Seiroku Kajiyama, may still be offered the post but he also appears unlikely to accept it.

Kajiyama had come in second after Obuchi in the LDP’s divisive election for a new party president. His outspoken calls for radical ``surgery″ to cure Japan’s economic ills quickly turned him into the darling of the financial markets.

Update hourly