JAPAN:YURIKO KOIKE, who is aiming to become Japan's first female leader, received a boost to her campaign yesterday after the popular former prime minister Junichiro Koizumi endorsed her ahead of the leadership election of the ruling Liberal Democrats (LDP).
The backing of Mr Koizumi is a boon for Ms Koike, but is not expected to dent the clear lead of Taro Aso, LDP secretary general.
It comes as revised GDP figures for the world's second-largest economy showed whoever takes over will struggle in the face of a worsening downturn.
Mr Koizumi, who had not made clear until yesterday whom he would back, said he believed Ms Koike would help the LDP to compete with the opposition Democratic Party of Japan in general elections expected as early as November 9th.
Ms Koike is one of five candidates running in the LDP leadership contest, which will determine who becomes Japan's next prime minister, after Yasuo Fukuda's surprise resignation.
The new prime minister is expected to dissolve parliament after the election on September 22nd, and call elections for the lower house of the Diet next month. Polls showed Mr Aso has a clear advantage, with more than 40 per cent of the votes.
Meanwhile, government data published yesterday showed the size of the challenge the winner faces in turning round the faltering economy.
Revised government figures published yesterday showed the Japanese economy had negative growth in the three months through June, of 0.7 per cent quarter-on-quarter, or an annualised 3 per cent.
This was the largest contraction since 2001 and slightly worse than preliminary figures, which showed a contraction of 0.6 per cent.
The downturn highlights the debilitating impact of higher raw materials prices, slowing exports and weak capital spending.
Economists expect growth to remain under pressure, with exports and capital spending continuing to suffer.
Against this background, all five candidates in the LDP race emphasised their intention to help revitalise the faltering economy.
Mr Aso has been the most aggressive in his economic stimulus programme, saying the economy will need three years to recover and calling for policy tax cuts to stimulate growth.
Ms Koike, a former defence minister, who has pledged to continue the former prime minister's structural reform programme, will look for spending cuts and the use of a so-called hidden budget to stimulate the economy. - (Financial Times service)