The New Nation - Internet Edition

AFP, Tokyo

Japan's new Prime Minister Taro Aso on Sunday faced his first political setback just days after taking office as his transport minister was forced to resign over a series of embarrassing gaffes.

The resignation was a serious blow to the outspoken, flamboyant Aso, who had been expected to call a snap election-perhaps as early as this week-to capitalise on his government's honeymoon period.

Instead, his administration has fared poorly in initial public opinion polls after taking the reins on Wednesday, and observers said the resignation of Transport Minister Nariaki Nakayama would only make things worse.

Nakayama made a series of blunders last week in his very first interview, one of which was saying that Japan was "homogenous"-a remark which raised the hackles of the country's indigenous Ainu people.

He also said schools with unionised teachers had lower standards, and accused farmers fighting for land seized for airport construction of "making profits by whining."

"I just submitted a letter of resignation to the prime minister," Nakayama told a hastily arranged press conference after an early morning meeting with Aso. "It was accepted, therefore I have resigned from the post."

"If my remarks have made any impact on parliamentary proceedings, it would not be what I had intended," he said.

Aso's government is expecting some tough battles in parliament, with the opposition in control of the upper house and piling the pressure on Aso to put his Liberal Democratic Party (LDP) on the line by calling early elections.

Opposition leader Ichiro Ozawa said Nakayama's resignation was "no surprise," telling reporters: "I believe the prime minister bears significant responsibility."

Aso, a conservative who has vowed new budget measures to revive the world's second largest economy, took office on Wednesday, replacing the unpopular Yasuo Fukuda, who resigned early this month.

Top government spokesman Takeo Kawamura admitted Nakayama's resignation had caused "damage" to Aso's administration.

"The resignation was inevitable due to the remarks and the development of the situation," Kawamura told reporters.

"The Aso cabinet will just have to do the best to regain public confidence by showing good work."

Nakayama is a staunch conservative who headed a group which denied that Japanese troops massacred tens of thousands of people in the Chinese city of Nanjing in 1937.