Japan farm minister resigns in blow to PM Abe

TOKYO, Sep 3 (Reuters) Japan's farm minister resigned today over illegal dealings at a farmers' group he headed, dealing a fresh blow to Prime Minister Shinzo Abe just a week after he revamped his cabinet.

A junior minister also quit today, bringing back memories of Abe's first cabinet, which was plagued by scandals and gaffes, including the loss of two previous farm ministers.

Agriculture Minister Takehiko Endo was the first to depart from a new cabinet line-up 52-year-old Abe named just last Monday to try to revive public support after an election drubbing that cost the governing coalition control of parliament's upper house.

Endo admitted on Saturday that a farmers' aid group he headed had illegally taken 9,900 dollars from the state and that he had failed to disclose this to the prime minister before his appointment.

The 68-year-old Endo, who had been reluctant to take on the ill-fated post, confirmed his resignation after meeting Abe.

''I feel sorry that I could not live up to Prime Minister Abe's expectations,'' Endo told a news conference.

Abe's first appointee to the portfolio committed suicide in a separate scandal and the second was fired over reports of discrepancies in his political funding records.

Two other ministers in Abe's first cabinet were forced to resign over gaffes or scandals.

Political analysts said Abe's popularity would take another hit although he was likely to cling to power for now.

''I had thought only one more scandal and he would be out, but maybe ... he will keep being unpopular but stay in office,'' said Koichi Nakano, a political science professor at Sophia University in Tokyo said.

Financial markets, worried about unexpected signs of weakness in Japan's economy and the outlook for interest rates, spared little thought for Abe's woes, although some said the resignations boded ill for his ability to implement policies.

TRY TO SURVIVE Public support for Abe, who took power a year ago pledging to revise Japan's pacifist constitution and boost its security profile, had rebounded to around 40 percent in some surveys after he named a new cabinet, which is packed with political veterans.

But Endo's resignation stirred fresh doubts about Abe's leadership ability and gave a feisty opposition new ammunition.

''This is not just a matter of one minister's scandal, but a deep structural problem of collusive ties between the government, bureaucracy and industry,'' said Kenji Yamaoka, lawmaker of the main opposition Democratic Party in charge of parliamentary affairs.

Another new appointee, Parliamentary Secretary for Foreign Affairs Yukiko Sakamoto, resigned after admitting that a campaign office in her constituency misreported political fund outlays.

Another junior cabinet member apologised over the weekend for misreporting expenditures.

''The approval rate recovered temporarily during the honeymoon after the reshuffle, but it's very likely to deteriorate again,'' said Toru Umemoto, chief foreign exchange strategist at Barclays capital.

But Umemoto and other analysts said Abe himself was unlikely to step down any time soon, given the lack of ruling party politicians who want to take over the premiership now.

The main opposition Democratic Party, which rejigged its own leadership on Friday, is already gearing up for a lower house election, though none need be held until late 2009.

Opposition party leaders had threatened to submit a non-binding censure motion against the farm minister in parliament's upper house, which would have been an embarrassment for Abe's government.

To replace Endo, Abe tapped former environment minister Masatoshi Wakabayashi, who also served as farm minister when Endo's predecessor resigned.

An extra session of parliament is expected to start around September 10 and the government will have a tough time enacting laws, including one to extend a naval mission in support of US-led operations in Afghanistan that the opposition is against.

Reuters GL GC1028