Japan's Abe suffers setback with Okinawa election loss

By Linda Sieg TOKYO (Reuters) - A city mayor opposed to a plan to relocate a controversial U.S. airbase on Japan's Okinawa island was re-elected on Sunday, creating a political headache for Prime Minister Shinzo Abe and threatening friction with Washington. Delays in relocating the U.S. Marines' Futenma air base, a move first agreed between Tokyo and Washington in 1996, have long been an irritant in U.S.-Japan ties. Abe is keen to make progress on the project as he seeks tighter ties with the United States in the face of an assertive China. Abe's ties with Washington suffered after the United States expressed "disappointment" with his December 26 visit to Yasukuni Shrine. The pilgrimage further strained relations with China and South Korea, which see the Tokyo shrine to Japan's war dead as a symbol of its past militarism. Susumu Inamine - a staunch opponent of the relocation plan - was re-elected as mayor of the Okinawa city of Nago, defeating an opponent who had backed the project and run with the strong support of Abe's Liberal Democratic Party (LDP). Last month, Okinawa Governor Hirokazu Nakaima approved a landfill project to implement the plan to move Futenma's functions from a populous part of central Okinawa to Nago's coastal Henoko area. "The plan must go back to square one," Inamine told reporters on Sunday. "I will reject all procedures that are premised on the landfill project." Inamine's win was a rare setback for Abe, whose support rates have remained robust since he returned to power for a second term just over a year ago. Futenma has long been a lightning rod for discontent among Okinawa residents, many of whom associate the concentration of U.S. bases with accidents, pollution and crime such as the 1995 rape of a Japanese schoolgirl by three U.S. servicemen. GOVERNMENT STICKS TO PLAN Chief Cabinet Secretary Yoshihide said on Monday the central government would move forward with the relocation plan, calling it the only way to reduce the burden on Okinawa while maintaining deterrence against potential threats. "The governor approved the landfill project last year and, while explaining and seeking understanding as much as possible, we want to move ahead," Suga said, adding that the Nago mayor's authority was limited. Seeking to soothe discontent, Abe's government earmarked 348 billion yen ($3.34 billion) for Okinawa's economic development in the draft budget for the year from April and pledged about 300 billion yen per year through 2021/22. Abe also promised to study whether the relocation plan could be speeded up and said the government would start talks with the United States on a deal that could allow for more oversight of environmental issues at U.S. bases. Political analysts say Abe could risk denting voter support for his government, which came to power at the end of 2012 with promises to revive the economy, if he does push ahead with the relocation of the base in the face of local opposition. "Inamine's victory will give momentum to the anti-base movement and the opposition campaign could spread," Takashi Kawakami, a professor at Takushoku University, said. "Abe will probably try to forge ahead but there will probably be an opposition movement ... and if this is reported in the media daily, Abe's support rates could fall." Abe faces another poll challenge when Tokyo voters choose a new governor on February 9. Former Prime Minister Morihiro Hosokawa, backed by charismatic ex-premier Junichiro Koizumi, has said he will run on an anti-nuclear power platform. A Hosokawa victory could snarl Abe's attempts to restart reactors that have been offline since the March 2011 Fukushima nuclear disaster and restore atomic energy to a core position in the nation's energy policy. ($1 = 104.2700 Japanese yen) (Additional reporting by Nobuhiro Kubo; Editing by Paul Tait)