As the Group of Seven (G7) finance chiefs descends on Washington D.C. next week, the Japanese government plans to propose Masaaki Shirakawa as the head of the Bank of Japan in a rush to ensure attendance at the key international meeting.
The governor's post has been vacant since March 19 because of a parliamentary deadlock over finding a successor. The opposition-controlled upper house has rejected two candidates named by the ruling party, which controls the lower house.
The previous nominations have been too politically connected to be nominated, the opposition claims, with both candidates serving as bureaucrats at the Ministry of Finance.
On Friday however, the government chose Masaaki Shirakawa, who has no previous political ties and is currently serving as the deputy governor of the bank.
Hiroshi Watanabe, a former vice finance minister for international affairs, would take the position as deputy governor if Shirakawa is approved.
A third rejection will be a devastating embarrassment for Prime Minister Yasuo Fukuda, who runs the risk of having no central bank head to send to a Group of Seven finance chiefs' meeting April 11 in Washington D.C.
The government wants to nominate a new BOJ chief as soon as possible, and there will be an official meeting of both the lower and upper houses on April 9th. The government and the ruling parties are having talks with Democratic Party of Japan (DPJ), the main opposition party, to push the nomination forward.
It will take time to determine whether their plan for next BOJ Governor and Deputy Governor is suitable or not, because we have to consolidate our party members opinions, said a DPJ official.
The ruling Liberal Democratic Party (LDP) is now waiting for the DPJ's response, which could come as soon as Monday.
Realistically, we cannot do anything unless the upper house gives us a go-ahead. Without clearing that obstacle, we cannot reach a conclusion, ruling LDP chief Bunmei Ibuki told reporters.