Japan's finance minister quits as Japan faces slump

17 February 2009

Japan's finance minister Shoichi Nakagawa announced his resignation in Tokyo today after being criticised for embarrassing behavior at the Group of 7 meeting in Rome.

At a press conference on the sidelines of the G 7 meeting last week-end, Nakagawa (55) was reported to have slurred his speech, muddled answers to questions by media persons and appeared to fall asleep, a clip of which has also been circulating on YouTube.

Faced with criticism from Japanese politicians – belonging to both the ruling and opposition parties - Nakagawa on Tuesday stepped down after Parliament passed a series of budget measures aimed at stimulating the economy.

Nakagawa's continuation as finance minister would have been a major embarrassment to prime minister Taro Aso, under fire for his handling of the economy.

Japan's coalition government led by the Liberal Democratic Party is in danger of losing the election and this could set the stage for far-reaching changes in Japanese politics.

The finance minister's resignation comes as the country announced a stimulus package for the flagging economy that is shrinking at an annual rate of 12.7 per cent.