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Japan PM faces rift from party kingpin
Source: Agencies |
September 1, 2010, Wednesday
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JAPAN'S powerbroker Ichiro Ozawa confirmed yesterday he would challenge Prime Minister Naoto Kan in a party vote, setting up a clash that risks creating a policy vacuum as Japan struggles with a strong yen and fragile growth.
The strife in the Democratic Party of Japan, which could split the party just a year after it took power for the first time promising changes, coincides with policymakers' efforts to curb a rise in the yen that threatens economic recovery.
"This could be the beginning of a party split. It may not be immediate, but the confrontation is real and serious," said Koichi Nakano, a Sophia University professor.
Ozawa, 68 and known for shaking things up, announced his decision after efforts failed to avoid a showdown in the September 14 DPJ leadership vote.
"As I have said before, I have decided that although I am unworthy I would like to take part (in the race) with everyone's support," Ozawa told a news conference.
The winner of the race will likely become prime minister by virtue of the Democrats' majority in parliament's powerful lower house.
Kan is already Japan's fifth leader in three years.
Ozawa has criticised Kan for floating a possible rise in the 5 percent sales tax ahead of a July upper house election. The DPJ's poor showing in that poll cost the ruling bloc its majority in the chamber and forced the Democrats to seek opposition help to pass bills.
Kan reiterated yesterday that debate was needed on reforming the sales tax, which economists say needs to be raised to fund the bulging social welfare costs of a fast-ageing society.
Ozawa wants to stick to pledges made before last year's general election to put more cash in households' hands, while Kan has signalled the need to revise the promises, given a public debt already twice the size of the US$5 trillion economy.
Ozawa's admirers say the veteran political strategist's deal-making skills may be just what Japan needs to break through the political deadlock. Others say his election will likely spark confusion and worsen the policy gridlock.
"I see Ozawa's entry in the race positively. I think he is more capable and has power to take bold measures to boost the economy," said Ryosuke Okazaki, chief investment officer at ITC Investment Partners, an asset management arm of Itochu Corp.
Many credit Ozawa with engineering the huge election win that swept the DPJ to power, but a majority of voters are put off by his image as a scandal-tainted wheeler-dealer.
Ozawa stepped down as party leader last year over a political funding scandal and resigned as the party's No.2 in June. He faces possible indictment if a judicial panel of ordinary citizens rules he must be charged.
The strife in the Democratic Party of Japan, which could split the party just a year after it took power for the first time promising changes, coincides with policymakers' efforts to curb a rise in the yen that threatens economic recovery.
"This could be the beginning of a party split. It may not be immediate, but the confrontation is real and serious," said Koichi Nakano, a Sophia University professor.
Ozawa, 68 and known for shaking things up, announced his decision after efforts failed to avoid a showdown in the September 14 DPJ leadership vote.
"As I have said before, I have decided that although I am unworthy I would like to take part (in the race) with everyone's support," Ozawa told a news conference.
The winner of the race will likely become prime minister by virtue of the Democrats' majority in parliament's powerful lower house.
Kan is already Japan's fifth leader in three years.
Ozawa has criticised Kan for floating a possible rise in the 5 percent sales tax ahead of a July upper house election. The DPJ's poor showing in that poll cost the ruling bloc its majority in the chamber and forced the Democrats to seek opposition help to pass bills.
Kan reiterated yesterday that debate was needed on reforming the sales tax, which economists say needs to be raised to fund the bulging social welfare costs of a fast-ageing society.
Ozawa wants to stick to pledges made before last year's general election to put more cash in households' hands, while Kan has signalled the need to revise the promises, given a public debt already twice the size of the US$5 trillion economy.
Ozawa's admirers say the veteran political strategist's deal-making skills may be just what Japan needs to break through the political deadlock. Others say his election will likely spark confusion and worsen the policy gridlock.
"I see Ozawa's entry in the race positively. I think he is more capable and has power to take bold measures to boost the economy," said Ryosuke Okazaki, chief investment officer at ITC Investment Partners, an asset management arm of Itochu Corp.
Many credit Ozawa with engineering the huge election win that swept the DPJ to power, but a majority of voters are put off by his image as a scandal-tainted wheeler-dealer.
Ozawa stepped down as party leader last year over a political funding scandal and resigned as the party's No.2 in June. He faces possible indictment if a judicial panel of ordinary citizens rules he must be charged.
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