Japan’s Finance Minister to Quit After G-7 Blunder

Japan’s Finance Minister to Quit After G-7 Blunder

TOKYO — Japan’s finance minister, facing ridicule and criticism for embarrassing behavior at the weekend Group of 7 meeting in Rome, said Tuesday he would resign.

Shoichi Nakagawa raised eyebrows for slurred speech, muddled answers and appearing to fall asleep at a news conference in Rome on Saturday. A clip of Mr. Nakagawa in which he appeared to be groggy in front of journalists has been circulating on YouTube. 

After intense criticism from politicians who said he had embarrassed Japan on the world stage, Mr. Nakagawa on Tuesday said he would step down after Parliament passes a series of budget measures aimed at stimulating the economy. it was unclear when exactly this will be, but probably not for several weeks, analysts said.

The delay in vacating the position could cause political bickering, with opposition politicians likely to demand that he step down immediately. 

“It’s possible that the opposition will demand he resign immediately, rather than after the budget in late March, and that could complicate the situation," said Hiroshi Shiraishi, an economist at BNP Paribas in Tokyo.

Mr. Nakagawa’s behavior was a major embarrassment to Prime Minister Taro Aso, who is under fire for his handling of the economy and whose public support has plummeted ahead of elections later this year. 

The long-ruling Liberal Democratic Party and its junior coalition partner are in danger of losing the election, which could set the stage for far-reaching changes in Japan’s political landscape. 

Although Mr. Nakagawa’s behavior may not make much difference to voters -- Mr. Aso’s ratings in some opinion polls already below 10 percent -- “what it does underscore is how unprofessional the Aso government is,” said Jesper Koll, chief executive of Tantallon Research in Tokyo. 

Mr. Nakagawa’s resignation comes as the country is trying to stimulate a flagging economy. D data on Monday showed the world’s second-largest economy had deteriorated in the fourth quarter of 2008 at its fastest pace since 1974. The country’s real gross domestic product shrank at an annual rate of 12.7 percent from October to December after contracting for two previous quarters as the country’s mainstay exports slumped amid the global economic crisis. 

Some economists believe that the current quarter could be even worse and that added stimulus measures will be needed to haul the economy out of recession. Mr. Shiraishi of BNP Paribas on Monday revised his forecast for contraction this year to 5.8 percent from an earlier projection of 3.4 percent. 

Mr. Nakagawa, 55, said cold medication and fatigue were to blame for his behavior, but also admitted to sipping wine before the event. 

In a televised press conference on Tuesday, he apologized and said he intended to step down. “I apologize for causing great inconvenience over my behavior at the G-7 meeting,” Mr. Nakagawa said. “However, I still have a strong commitment to improving Japan’s economy.”

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