Nominee for Japan central bank chief to stand confirmation hearing at parliament

Business Materials 8 April 2008 06:45 (UTC +04:00)

(iht) - The government's third nominee to head Bank of Japan was to go before lawmakers Tuesday to seek their support in ending a leadership vacuum at the central bank following the opposition's rejection of two previous candidates.

Confirmation hearings were scheduled in both houses of parliament for Masaaki Shirakawa, a former Bank of Japan executive director, who was nominated on Monday. The political opposition rejected the two previous candidates on grounds that they were too closely tied to the Finance Ministry.

Prime Minister Yasuo Fukuda's government hopes to resolve the central bank dispute ahead of a Group of Seven financial chief's meeting later this week.

Shirakawa, recently confirmed as one of the bank's deputy governors, has been serving as the interim bank chief since Gov. Toshihiko Fukui retired on March 19.

Shirakawa, 58, and a nominee for deputy governor, Hiroshi Watanabe, are to stand for public hearings at each house of parliament Tuesday. Watanabe is a former vice finance minister for international affairs.

The nomination for BOJ governor needs approval from both the upper and lower house, with voting expected Wednesday. The opposition controls the upper house.

Comments late last week and over the weekend by opposition party leaders suggest that Shirakawa could get the green light. Their decision over a deputy nomination remains uncertain.

Opposition leaders have said they opposed the practice of appointing retired government officials to top positions at private and public organizations.

The timeline is in part driven by the G-7 gathering Friday in Washington. Another failure would mean a major embarrassment for the world's No. 2 economy amid global economic uncertainty. A prolonged vacancy could be a further blow to Fukuda's already plunging public support.