 The government is keen to get Mr Shirakawa appointed |
Japan's government has picked Masaaki Shirakawa as the nominee for the country's new central bank governor. The post has been vacant since March after opposition politicians argued the government's two previous nominations were not independent enough. The main opposition party has signalled support for Mr Shirakawa, currently deputy governor at the Bank of Japan. Tokyo will be keen to get the nomination approved ahead of the weekend's G7 meeting. Failure to send a central bank head would be a major embarrassment for the world's second-largest economy. The government also nominated Hiroshi Watanabe, a former vice finance minister for international affairs, as a deputy Bank of Japan governor to replace Mr Shirakawa. 'Capable hands' "I have said since day one of his nomination that the BoJ would be in capable hands with him at the helm," said Kirby Daley, strategist at Newedge Group. "He is a well-seasoned veteran with strong experience." If Mr Shirakawa is appointed to the post, he will replace Toshihiko Fukui who retired on 19 March and will take the reins amid a period of turmoil in the global economy. Analysts are worried that the Japanese economic recovery could be derailed and that the economy could experience a mild recession. Japan's economy is expected to grow by 1.6% in 2008, the Organisation for Economic Cooperation and Development (OECD) said on Monday. However, Japan is facing "persistent deflation, a large and growing public debt and widening disparities between different segments of the economy", it said. The OECD, which groups the world's richest economies, said that growth would pick up in 2009 to 1.8%, with business investment and exports leading the expansion. Cash pile Meanwhile, Japan's foreign exchange reserves have reached record levels. The country's currency stockpile, the world's second largest after China, rose to $1.016 trillion at the end of March, setting a record high for the ninth month in a row. The increase is partly down to the euro's rise against the dollar. Some Japanese lawmakers have proposed that Japan should follow countries like China and establish a sovereign wealth fund to get a better return from its massive reserves. However, the Finance Ministry is opposed to the idea.
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He is a well seasoned veteran with strong experience
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