Finance minister’s first step towards Japan’s top position

Japan’s ruling party has elected finance minister Yoshihiko Noda its new chief, paving the way for him to be the next prime minister and inherit the daunting task of recovering from the huge tsunami and nuclear crisis.

Mr Noda, 54, is known as a fiscal conservative and has lately been battling a sluggish economy, bulging national debt and the yen’s record surge, which hurts Japan’s exporters by making their products more expensive overseas.

As prime minister – Japan’s sixth in five years – he will have to broaden his scope to deal with the continuing reconstruction from the 11 March quake and tsunami along the north-eastern coast and the 100,000 people who remain dislocated because of radiation leaking from a tsunami-damaged nuclear plant.

“Let us sweat together for the sake of the people,” he said after the vote. “This is my heartfelt wish.”

Mr Noda will replace prime minister Naoto Kan, who announced on Friday that he is resigning after nearly 15 months in office – a period plagued by public discontent over political infighting and his administration’s handling of the disasters.

Mr Noda defeated trade minister Banri Kaieda by 215-177 in a run-off election among ruling party members of parliament after none of the initial five candidates won a majority in the first round. Mr Noda will go on to become prime minister because the Democrats control the more powerful lower house of parliament. His Cabinet will be installed later this week.

Mr Noda came from behind to win the run-off, getting 102 votes in the first round to Mr Kaieda’s 143. The result is a slap against Ichizo Ozawa, a scandal-tainted party powerbroker who threw his support behind Mr Kaieda.

Mr Ozawa, 69, who heads the largest faction in the Democratic Party, is known for engineering elections, sending novices to parliament and dooming some candidates to defeat. He is embroiled in a political funding scandal but his presence has hung like a shadow over the party leadership campaign.

After the vote, Mr Noda called for party unity, using a popular rugby term in Japan referring to the tradition that after a game ends, there are no longer opposing sides on the field.

Mr Noda is not from an elite background like many Japanese politicians. His father was a member of the self-defence force, Japan’s military.

Before he took on a ministerial post, he was known for standing at railway stations in his electoral district in Chiba, just east of Tokyo, every morning to greet commuters personally.

As finance minister since June 2010, Mr Noda has been contending with budgets and a strong yen, which hit a post-Second World War high against the dollar earlier this month.

Mr Noda was the most outspoken among the candidates about the need to raise the 5 per cent consumption tax to reduce the public deficit, which is twice the country’s gross domestic product, but toned down his tax talk ahead of the election. No quick change is expected on taxes, which would need parliamentary approval.

Many Japanese say taxes eventually need to be raised because of costs of disaster recovery and of social welfare for an increasingly aging society.

Japan has been plagued by rapid turnover in political leadership that has undermined its ability to tackle problems. The past five prime ministers lasted about a year each; Mr Kan lasted the longest at nearly 15 months.