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Pressure mounts on Japan PM

TOKYO, JANUARY 5 – Japan\’s parliament convened Monday for a session on measures to revive the flagging economy, with Prime Minister Taro Aso under pressure both from within and outside the ruling bloc to call a snap election.

Aso, whose support has dwindled to around 20 percent in recent polls, is introducing a 4.79 trillion yen (52 billion dollar) supplementary budget for the year to March 2009 and a record-high annual budget for fiscal 2009.

The packages include tax cuts, cash rebates and other incentives aimed at stimulating the world\’s second largest economy, which has slipped into recession.

"We face a mountain of difficult issues sitting before us. But let us be united and go through the parliament session," Aso told his ministers in the new year\’s first cabinet meeting.

Aso later told lawmakers from his Liberal Democratic Party (LDP): "We are confident that we submitted the best plan possible and that the legislation is the best remedy to boost the economy."

Finance Minister Shoichi Nakagawa urged parliament to pass the legislation, warning that the economy was set to get worse as demand for Japanese exports slumps and consumer spending fails to pick up.

"The international financial and capital markets have fallen into a crisis that is said to come only once in 100 years, pushing the economy into recession," Nakagawa said.

However, the Aso government faces tough battles on the legislative floor. The opposition, which controls the less powerful upper house, is gearing up to block bills from the ruling party and is demanding an early snap election.

The LDP has been in power for all but 10 months since 1955, but has switched premier three times in little over two years as it struggles to win public support.

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"This year will become a year of historic importance," Ichiro Ozawa, the leader of the main opposition Democratic Party of Japan, told a party meeting.

"With our goal of putting the priority on people\’s lives, we have to earn public support — first through snap elections and then through actual policy-making," Ozawa said.

Even some senior members from within the LDP have levelled fresh criticism at Aso over the last few days.

Former LDP secretary general Hidenao Nakagawa lamented Aso\’s plan to raise consumption tax in three years\’ time, saying even discussing it now could "further hurt the Japanese economy."

Nakagawa has suggested starting a new faction within the ruling party by grouping lawmakers who oppose Aso\’s ideas.

Former reform minister Yoshimi Watanabe also reiterated his call for snap elections and changes to the proposed budget.

"If my message isn\’t taken into consideration, I am prepared to launch a national movement even if I have to leave the LDP," he told supporters on Sunday.

But Aso told a news conference Sunday he would not call elections for a few months at least, pledging to tackle the economic crisis first.

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