WRAPUP 1-Japan ruling party support leaps on new leader-poll

(For more stories on Japanese politics click [ID:nPOLJP])

* Ruling party support leaps to 36.1 pct in poll

* PM-elect picks fiscal conservative Noda as finmin

* Party kingpin Ozawa could prove headache

By Isabel Reynolds

TOKYO, June 5 (BestGrowthStock) – Support for Japan’s ruling
Democratic Party leaped to 36.1 percent in a poll published by
Kyodo news agency on Saturday after the appointment of a new
leader in the run-up to an upper house election.

The figure was up 15.6 percentage points on a poll carried
out at the end of May before unpopular prime minister Yukio
Hatoyama stepped down and was replaced as party head, and thus
premier, by Naoto Kan.

Kan, 63, will become Japan’s fifth prime minister in three
years, taking over as the country struggles to rein in a huge
public debt, engineer growth in an ageing society, and manage
ties with security ally Washington and a rising China.

Kan’s rise and his cabinet line-up, set to be announced on
Tuesday, could spell bolder steps to contain a public debt
twice the size of the economy. But he faces opposition from
many in his party before the election, expected in July.

He has picked Katsuhiko Noda as finance minister, Kyodo
said, a choice that will be welcomed by the bond market because
he favours fiscal discipline and has supported the idea of
capping new debt issuance for next year.

Satoshi Arai, a former aide to the outgoing Hatoyama, is to
become national strategy minister, Kyodo said. Kan will keep
Foreign Minister Katsuya Okada and Defence Minister Toshimi
Kitazawa, but plans to replace eight cabinet members, the
agency said.

In the Kyodo telephone poll carried out on Friday and
Saturday, 57.6 percent of respondents said they had high
expectations of Kan, a fiscal conservative with a reformist

That compares with just 19.1 percent of respondents to a
similar question posed in the May poll on expectations of
Hatoyama, Kyodo said.

Nearly 33 percent of respondents said they planned to vote
for the Democrats in the upper house election, compared with
23.4 percent for the main oppposition Liberal Democratic Party,
which had been in the lead in the previous poll, Kyodo said.


Unlike many recent premiers, Kan has no connection with a
political dynasty. That could appeal to voters weary of leaders
from well-to-do backgrounds who prove inept at governing.

He got his start in politics as a student activist, later
joining small political parties before helping to found the
then-opposition Democratic Party in 1996.

But among Kan’s biggest immediate headaches may be Ichiro
Ozawa, the former party secretary general widely seen to have
held sway over Hatoyama’s government from behind the scenes.

Kan has made clear he wants to sideline the 68-year-old
Ozawa. Funding scandals linked to him, over which three of his
current and former aides were indicted, were one of the main
reasons for the Democrats’ loss of voter support.

Many of Ozawa’s supporters backed Kan’s rival for the top
party job and on Friday he hinted he would not fade away.

“I’m sorry I did not come to the forefront this time,” the
Yomiuri newspaper quoted him as telling supporters, some of
whom had urged him to stand against Kan.

“But the real contest comes in September,” he added,
referring to the next party leadership election.

Ozawa is known as a master campaign strategist, but is
reluctant to promise bold fiscal reform steps such as raising
the sales tax ahead of the upper house poll.

The Democrats have a large lower house majority and will
run the government whatever the outcome of the July upper house
poll. But the ruling bloc needs to win a majority in that
chamber to ensure that legislation is enacted smoothly.
Stock Market Research

(Editing by Ron Popeski)

WRAPUP 1-Japan ruling party support leaps on new leader-poll