**Japanese PM Yukio Hatoyama has been forced to replace his experienced finance minister, Hiroshisa Fujii, who has resigned due to ill health.**Naoto Kan has been chosen as the country’s new finance minister.
Mr Hatoyama had earlier said he did not want Mr Fujii, one of the few experienced ministers in his Democratic Party-led government, to stand down.
Mr Kan will inherit the job at a time when Japan faces deflation, a fragile economy and huge public debt.
The change of faces in such a key post is being seen as a severe test for Mr Hatoyama - who came into power in September after nearly 50 years of conservative rule and is already suffering from falling ratings.
Mr Fujii’s departure will add to uncertainty about the relatively inexperienced Hatoyama government’s ability to handle the country’s economy.
Mr Fujii - who was trusted by the markets for his fiscal restraint -had been working on a budget which faces a crucial vote later this month, and had resisted pressure from within Japan’s governing coalition to spend more on public works.
Mr Kan is unlikely to favour big spending at the moment, either, given that public debt is almost 200% of GDP.
But analysts say he may be unable to resist the pressure to release more money if the economy stalls again.
Health concerns
Mr Kan, like Mr Hatoyama, is a founder of the ruling Democratic Party.
He is known for his tough debating skills, and is keen to reduce the political clout of influential bureaucrats.
He previously headed the National Strategy Bureau that sets priorities for fiscal policy, but he is thought by the markets to lack Mr Fujii’s extensive experience of budget and tax issues.
Mr Fujii tendered his resignation overnight, after being admitted to hospital last week suffering from high blood pressure.
He had told reporters he was exhausted after weeks of wrangling within Japan’s governing coalition to finalise the budget.
Mr Hatoyama then reportedly asked Mr Fujii to stay, to see through his work on the budget. But later the prime minister told public broadcaster NHK: “Problems of health are inevitable… and so I have accepted his resignation.”
“Finance Minister Fujii has been exhausted. The doctors’ medical certificate said it is difficult for him to execute his official duty as a minister. I have no choice but to take the doctors’ diagnosis seriously.”