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Japan's PM reshuffles cabinet
( 2002-09-30 14:31 ) (7 )

Japanese Prime Minister Junichiro Koizumi waits to receive Malaysian Defense Minister Najib Razak prior to their meeting at Koizumi's official residence in Tokyo September 30. Koizumi replaced some cabinet ministers on Monday as financial markets waited anxiously for clues to whether Japan will shift policy gears and take bold action to clean up its ailing banks.[Reuters]

Japan's Prime Minister Junichiro Koizumi reshuffled his Cabinet on Monday but retained his main ministers in an attempt to reaffirm his administration's commitment to pulling this country out of its decade-old economic slump.

Though the actual changes were few, the reshuffle was the first since Koizumi took office in April last year. It was seen mostly as underscoring his desire to push ahead with structural reforms deemed crucial if Japan is to restart its economic engines.

Staying on were Foreign Minister Yoriko Kawaguchi and Koizumi's two top economic advisers — Finance Minister Masajuro Shiokawa and Heizo Takenaka, the economic and fiscal policy minister, according to Chief Cabinet Secretary Yasuo Fukuda. Fukuda was also retained.

Cut from the list was Financial Services Minister Hakuo Yanagisawa, who has been criticized for shying away from aggressive fiscal measures to deal with Japan's troubled banking sector.

Koizumi's popularity has risen dramatically since he traveled to North Korea ( news - web sites) for an unprecedented summit Sept. 17 with leader Kim Jong Il. According to a poll last Sunday by the Mainichi, a major daily, support shot up to 67 percent from 43 percent in a similar poll the previous month.

He continues to be under intense pressure to pull the economy out of its decade-old slump, however.

Since taking office, Koizumi has vowed to help clean up the bad loan problem that has saddled Japan's banking industry, cut fat in highway construction spending and reform the insurance and postal savings sectors.

Before announcing his intention to reshuffle the Cabinet, Koizumi made it clear that he would only consider replacements who would help him push through reforms, rather than caving to party pressures by appointing faction favorites, as is tradition.

Fukuda, briefing reporters after the resignations were submitted Monday morning, said Koizumi hoped the reshuffle would bolster his efforts to "accelerate structural reforms."

But as an indication of his concern to also preserve continuity, Koizumi announced last week he was retaining his party's three top leaders — Taku Yamasaki, Taro Aso and Mitsuo Horiuchi — whose one-year terms expired Monday.

He then holed up at his residence over the weekend, holding no meetings with party or coalition leaders.

That angered some.

"There should be more transparency," said Takenori Kanzaki, head of the New Komeito, one of the ruling coalition's three parties.