Ex-bureaucrat can head BOJ, DPJ says

Kyodo

The Democratic Party of Japan will not automatically reject former Finance Ministry officials as candidates for the next Bank of Japan governor, DPJ lawmakers said Tuesday, signalling a shift from the party’s previous position.

Prime Minister Shinzo Abe of the ruling Liberal Democratic Party is expected to soon present to the Diet his BOJ gubernatorial candidate to succeed Masaaki Shirakawa when his five-year stint ends in early April. Both Diet chambers must approve the nominee.

DPJ draft guidelines do not automatically disqualify someone based on past employment. Five years ago, the DPJ spurned former officials from the Finance Ministry, arguing fiscal and monetary functions must be separated.

The DPJ now says it will assess candidates based on criteria such as their views on monetary policy and ability to communicate with financial market participants and manage an organization, the lawmakers said.

The DPJ’s shift may help Abe’s administration, which has not ruled out picking an ex-Finance Ministry bureaucrat to run the BOJ. The LDP-led ruling bloc lacks a majority in the Upper House. Abe has admitted he needs the opposition’s support to select the new governor.