WORLD> Asia-Pacific
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WORLD> Asia-Pacific
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Japanese PM Yasuo Fukuda decides to resign
(Agencies/chinadaily.com.cn)
Updated: 2008-09-01 20:30 The dollar popped back above 108 yenand the euro back up toward 158 yen on the surprise news, which caught traders off guard in a thinner market than usual because of a U.S. holiday. "Markets don't like political uncertainty and this falls firmly into that camp. It doesn't help overall, even if he hasn't been particularly popular," said Jeremy Stretch, markets strategist at Rabobank in London. Fukuda's resignation does not automatically mean an election. His party, the Liberal Democratic Party, must pick a new leader and win the confidence of parliament's lower house if it wants to carry on leading Japan's coalition government. The bespectacled Fukuda, a moderate conservative who favours close ties with Japan's Asian neighbours, took office last September after his predecessor, Shinzo Abe, suddenly resigned. He has since seen his popularity sink on doubts about his leadership in the face of the divided parliament, where a feisty opposition is keen to force an early election for the powerful lower house and oust the long-ruling LDP. A government economic relief plan unveiled on Friday that included a promise of income tax cuts and about $16.5 billion in extra spending this year to ease the pain of rising prices, failed to revive his public support ratings. A survey by the Nikkei business daily released on Monday showed support for Fukuda's cabinet fell nine points to 29 percent, back to levels before a cabinet reshuffle last month. Concerns about Fukuda's leadership were deepened, analysts said, by a spat within the ruling bloc over the tax cuts, demanded by the junior coalition partner despite doubts within the dominant Liberal Democratic Party over their impact and worries about how to fund them. "Fukuda resigned mainly because of domestic problems. And whoever succeeds him will not overlook the importance of a healthy relationship with China," said Feng Zhaokui, senior advisor to the National Society of Japanese Economic Studies. "Fukuda's predecessor Shinzo Abe tried to mend relations with China Fukuda pushed it forward. Obviously Japanese politicians in general favor friendly ties (with China) despite the many cliques at work." Japan's policies toward China are not likely to move backward irrespective of who succeeds Fukuda, Feng said. Wang Taiping, China's former consul general in Osaka, said the key to post-Fukuda bilateral ties was how Japan's new prime minister positions China in his foreign policy. "Junichiro Koizumi's foreign policy reflected a 'leaving Asia for America' mentality, whereas Fukuda paid more attention to its neighbors. That made a big difference," Wang said. Wang said Taro Aso, who is seen by many as Fukuda's successor, "is not new when it comes to dealing with China. He is very clear about the sensitive issues and where the line can be drawn".
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