October 17, 2014 / 10:49 PM / in 3 years

In blow to Abe, Japan trade minister to resign over funds scandal: media

Japan's Economy, Trade and Industry Minister Yuko Obuchi leaves the upper house of parliament in Tokyo September 29, 2014.Yuya Shino

TOKYO (Reuters) - In a blow to Prime Minister Shinzo Abe, Japan's newly appointed trade and industry minister plans to resign following reports that some of her support groups misused political funds, Japanese media said on Saturday.

Yuko Obuchi, a 40-year-old mother of two and the daughter of a former prime minister, has told people close to Abe that she plans to quit and will discuss the matter when Abe returns on Saturday from an Asia-Europe summit in Italy, the Nikkei newspaper said.

Regarded as a possible future contender to become Japan's first woman premier, Obuchi apologized at a parliamentary panel on Thursday in the wake of the reports of the misuse of funds, which could violate electoral and political funding laws.

A Ministry of Economy, Trade and Industry spokesman said he was unaware of any plans by Obuchi to quit. No one answered the phone at her political office.

Obuchi told people close to Abe on Friday of her plan to take responsibility for the furore, the Nikkei said, without citing any sources for its report. "I am investigating (the funding issue) but I think there is no convincing explanation," the business daily quoted her as saying.

Abe tapped Obuchi less than two months ago to head the powerful METI. She was one of five women Abe chose in a cabinet reshuffle in an effort to bolster his popularity by showing his commitment to promoting women.

"I apologize from the bottom of my heart for the fuss created by my private matter," Obuchi said on Thursday in response to questions at a panel in the upper house of parliament.

The weekly magazine Shukan Shincho reported that two political support groups in Obuchi's constituency had spent some 26 million yen ($245,600) on theater tickets for her backers in 2010 and 2011. Major newspapers also followed up on the allegations made by the magazine.

The Mainichi newspaper said Obuchi's political funding oversight body had spent about 3.6 million yen over five years from 2008 at a clothing shop run by her sister's husband and a design office run by her sister.

Obuchi said she had instructed the political groups to investigate the matter, adding she believed the payments to her sister's shop fell within the scope of political activities but that further checks would be made.

She said she believed her supporters had paid for the theater events themselves but was aware it would be a violation of the law if her political groups made additional payments.

After her appointment, Obuchi was given the tough task of trying to gain public trust for the government's unpopular policy of restarting nuclear reactors following the 2011 Fukushima atomic disaster.

Abe had hoped the telegenic Obuchi would be able to ease opposition to nuclear power, but the controversy around her could hinder the government's plan for restarting the reactors, according to some political analysts.

The ruling coalition has a hefty majority in parliament, but the opposition Democratic Party has been targeting new cabinet ministers in parliamentary debates in the hope of denting Abe's popularity, still relatively robust at around 50 percent.

Abe's first brief tenure as prime minister in 2006-2007 was marked by scandals among his cabinet members, several of whom were forced to resign, but after his return to office in December 2012, his first cabinet was relatively scandal-free.

Additional reporting by Linda Sieg; Writing by William Mallard; Editing by Dean Yates

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