Tue, Dec 21, 2010 - Page 5 News List

Ozawa rejects Kan’s plea to appear at ethics panel

Reuters, TOKYO

Scandal-plagued Japanese powerbroker Ichiro Ozawa yesterday rejected a call from Japanese Prime Minister Naoto Kan to appear before a parliamentary ethics panel, threatening to widen a rift in the fractious ruling party.

Kan, who took office in June as Japan’s fifth prime minister in three years, has been trying to look decisive to bolster his sagging support rates and avoid becoming the latest of the nation’s “revolving door” leaders.

Kan also hopes that taking a tough line on Ozawa, who has denied wrongdoing but faces charges stemming from suspected misreporting by his political funds body, will help win opposition backing to pass laws in a divided parliament.

However, the party strife is exacerbating financial market concern about a lack of leadership as Japan struggles with deep-rooted policy challenges such as social welfare and pension reform and how to engineer growth in a fast-aging society.

“Markets are watching out for the long-term implications of the feud closely. Prolonging the present situation without any clear outcome is the worst for the market,” said Yumi Nishimura, a senior market analyst at Daiwa Securities Capital Markets. “The rivalry has already been dragging for some time, and if it continues ... it will likely have strong negative implications for the government’s policies next year.”

Kan, 64, met Ozawa, a 68-year-old veteran with a reputation for shaking things up, for about 90 minutes.

“I asked him to voluntarily appear before a parliamentary ethics panel, but Mr Ozawa said there is no grounds for him to appear,” Kan told reporters after the meeting.

Kan dodged a question about whether he would try to expel Ozawa from the party if he stuck to his stance. Ruling party executives were to meet later yesterday to discuss what to do next.

A weekend survey by the Mainichi newspaper showed support for Kan’s government had slipped 2 points to 24 percent, in line with other recent surveys.

Support for Kan’s Democratic Party of Japan (DPJ) was at 21 percent compared with 18 percent for the main opposition Liberal Democratic Party (LDP), suggesting the once-dominant LDP has failed to capitalize on its rival’s woes.

Analysts said the bickering could drag on into the new year.

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