Japan upper house OKs new central bank head after 3-week vacancy

Japanese CurrencyTokyo - Japan's upper house on Wednesday approved the government's nominee for central bank chief after the post has been left empty for three weeks over a standoff between the government and Diet.

The opposition-controlled House of Councillors agreed to promote Deputy Governor Masaaki Shirakawa to the governorship of the Bank of Japan after voting down two of the government's previous nominees.

However, the chamber rejected the nomination of Hiroshi Watanabe as deputy governor because opposition parties feared his past career as a finance minister for international affairs would interfere with the independence of the central bank. The opposition Democratic Party of Japan also cited to previous candidates' past careers in the Finance Ministry as reasons for voting down their nominations.

The Democratic Party of Japan also argued that having Watanabe as deputy governor would fall into the practice known as "amakudari," where senior bureaucrats are awarded post-retirement jobs at entities related to the sectors they formerly oversaw.

Prime Minister Yasuo Fukuda's administration argued that such experience would be useful for the leaders of the central bank.

The House of Representatives, controlled by Fukuda's ruling coalition, was expected to approve Shirakawa's nomination later today, just in time for a meeting of finance ministers and central bank chiefs of the Group of Seven leading economies Friday in Washington.

The vote on Shirakawa, who was only approved as deputy governor last month, put an end to the vacancy in the bank's top post after governor Toshihiko Fukui ended his tenure on March 19.

He worked at the central bank for 34 years before joining Kyoto University to teach economics in 2006. (dpa)

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