Keizo Obuchi named his “economic reconstruction” Cabinet on Thursday evening after being elected Japan’s 54th prime minister, tapping former leader Kiichi Miyazawa for the key post of finance minister.

Obuchi, 61, now has the job of guiding the nation out of its worst economic slump in decades, with a ruling party that lacks a majority in the Upper House.

After winning election following a split decision by the two chambers of the Diet, Obuchi unveiled the official lineup of his first Cabinet, popularly dubbed by the press and Obuchi as his economic reconstruction Cabinet. The group was to be inaugurated after an attestation ceremony at the Imperial Palace later in the evening.

To augment his own image as a low-key politician whose capabilities on policy matters remain to be seen, Obuchi successfully persuaded Miyazawa, 78, into taking up the difficult job of clearing the bad loan mess at banks and regaining international confidence in the nation’s economic health.

Miyazawa, who served as prime minister between November 1991 and August 1993, became the first politician since the end of the war to take the finance minister post after being prime minister.

Obuchi also tapped State Foreign Secretary Masahiko Komura as foreign minister and Kaoru Yosano, former deputy chief Cabinet secretary, for the job of minister for international trade and industry. Komura, a former director general of the Economic Planning Agency, is noted for his deep personal knowledge of relations with Russia.

To give a fresh image to his Cabinet, Obuchi hand-picked Taichi Sakaiya, a MITI bureaucrat-turned prominent author and critic, to head the Economic Planning Agency. He is the only member in the Obuchi Cabinet recruited from the private sector.

Sakaiya, whose real name is Kotaro Ikeguchi, played an active role in organizing the 1970 Osaka World Expo when he was a MITI official. In 1978, Sakaiya quit the ministry and started writing on a full-time basis when his novel “Yudan,” about the social panic triggered by the oil crisis of the 1970s, became a best seller.

Obuchi also picked Hiromu Nonaka, former LDP senior deputy secretary general, for chief Cabinet secretary, to serve as government-LDP coordinator and top government spokesman. Nonaka is a veteran lawmaker from the LDP’s largest faction, which Obuchi leads.

Obuchi took over the prime minister’s job from Ryutaro Hashimoto, who stepped down to take the blame for the party’s stunning setback in the July 12 Upper House election. Obuchi defeated rival candidates in a party race last Friday to become LDP president, but will face a serious challenge in moving bills, with his party’s weakened minority in the Upper House.

Hashimoto’s Cabinet resigned en masse Thursday morning prior to the opening of a 70-day extraordinary Diet session. The Diet will be in session through Oct. 7 to discuss government-proposed measures to restore health to the nation’s financial sector, including the establishment of “bridge banks” to take over failing banks and provide loans to their sound borrowers.

Obuchi is to deliver his first policy speech to the Diet on Aug. 7 and field questions from opposition leaders before the summer recess in mid-August.

Among other Cabinet members, former Defense Agency chief Sohei Miyashita was appointed as health and welfare minister, and Fukushiro Nukaga, deputy chief Cabinet secretary under the Hashimoto administration, as defense chief.

Shoichi Nakagawa was named agriculture minister, Seiko Noda posts minister, and former Tokyo University President Akito Arima was named education minister.

Arima was just elected to the Upper House on July 12 as the top candidate on the LDP’s proportional representation list. Noda, 37, a two-term member of the House of Representatives, is the only woman in the 20-member lineup. She is the youngest person to take up a Cabinet post since the end of the war.

The selection of Miyazawa, who is reputed to be a financial expert, reflected Obuchi’s strong desire to bring the nation’s wobbly financial system back to stability and nurse the ailing economy back to health at an early date.

Miyazawa, a Finance Ministry bureaucrat-turned politician, also served as finance minister under the Cabinets of former Prime Ministers Noboru Takeshita and Yasuhiro Nakasone. He leads the third-largest LDP faction and recently helped the party and the government draw up the bridge bank plan to liquidate doomed banks without exacerbating a credit crunch.

Obuchi has also informally picked four former Cabinet ministers to become parliamentary vice ministers.

Suzuki Muneo, former chief of the Hokkaido and Okinawa Development agencies, and Mitsuhiro Uesugi, former home affairs minister, were tapped to assist Obuchi as deputy chief Cabinet secretaries. They both belong to the Obuchi faction.

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