Yasuo Fukuda, a seasoned moderate lawmaker, was chosen Japan's Prime Minister yesterday, then tapped veteran ministers from his predecessor's Cabinet to confront a powerful opposition keen to force an election.

The long-ruling Liberal Democratic Party (LDP) picked 71-year-old Mr Fukuda as its leader to revive party fortunes after a disastrous year of scandals and election defeat under Shinzo Abe, who resigned abruptly on September 12.

"I call this 'the Cabinet with its back to the wall'," Mr Fukuda told a news conference. "If we put one foot wrong, the LDP could lose control of the government. It will be a tense time," he added, vowing to try to restore the electorate's faith in politics.

Mr Fukuda's selection, with the support of the party's factions, has raised fears of back-pedalling on efforts to rein in Japan's huge public debt as a struggling LDP, which has ruled for most of the past five decades, seeks to woo back voters.

A general election is not required until 2009 but could well come much sooner if debate in Parliament stalls.

The bespectacled Mr Fukuda, a proponent of warmer ties with Japan's Asian neighbours, bowed and smiled after being voted in as Prime Minister by the lower house, where the ruling camp has a huge majority.

In a sign of the battles ahead, the opposition-controlled upper house voted for Ichiro Ozawa, 65, leader of the main opposition Democratic Party, but that vote was overruled by the more powerful lower chamber.