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The Japanese parliament elected Shinzo Abe as prime minister Wednesday, giving him a second chance at the same job five years after he resigned abruptly. He becomes the nation's seventh prime minister in six years. FULL STORY

Japan parliament picks Shinzo Abe as prime minister

By CNN Staff
December 26, 2012 -- Updated 1103 GMT (1903 HKT)
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Shinzo Abe returns to power in Japan

STORY HIGHLIGHTS
  • "The economy is at the bottom. It's our first mission to turn it around," Shinzo Abe says
  • Abe, 58, is the nation's seventh prime minister in six years
  • He faces a major task of reviving the economy and making a decision on nuclear power
(CNN) -- The Japanese parliament elected Shinzo Abe as prime minister Wednesday, giving him a second chance at the same job five years after he resigned abruptly.
Abe, 58, is the nation's seventh prime minister in six years. He started the revolving door of prime ministers by resigning in 2007, just one year into the job.
The leader of the Liberal Democratic Party has vowed to boost the economy and defend Japanese interests, including territorial disputes with China over a group of islands.
Asia's first and second largest economies have been embroiled in a trade dispute over the islands in the East China Sea. Both nations claim the islands.
China was outraged when Japan nationalized the islands in September.
Abe gets second chance as Japan PM
Japan's leadership changes
Japan's nuclear dilemma
In retaliation, Chinese consumers slowed their purchases of Japanese products, dropping Tokyo's exports to China by more than 14% that month.
Some investors believe the second coming of Abe will be good for Japan's equity markets.
"Investors are pricing in ... much greater monetary easing," said Ben Collett, head of Japanese equities at Louis Capital Markets in Hong Kong.
In November, Abe called for unlimited monetary easing to jumpstart the economy. He also urged the Bank of Japan to raise its current 1% inflation goal to as much as 3%.
Since then, investors betting on an Abe administration have pushed the Tokyo Nikkei up by more than 10%.
Then there's the question of how Japan powers itself amid the backlash against nuclear energy following the meltdown of Fukushima nuclear reactors. The reactors melted after a powerful earthquake and tsunami in March last year.
Abe's party has called for safety tests on all nuclear plants over the next three years. Those that pass should be brought back online, he has said.
He'll also have to deal with the enduring task of cleaning up communities shattered by the earthquake and tsunami, and contend with local anger that the recovery seems to have stalled.
Former Prime Minister Yoshihiko Noda stepped down as party president after exit polls showed a smashing loss in lower house voting. His Democratic Party of Japan, once seen as a breath of fresh air, was considered increasingly ineffective.
Noda conceded defeat in parliamentary elections, signaling the return to power of the conservative Liberal Democratic Party that ruled the country almost continuously since its establishment in 1955. It was forced from power three years ago by Noda's party.
Abe is inheriting a struggling economy, regional tensions and questions over Japan's role in Asia.
"The economy is at the bottom. It's our first mission to turn it around," he said.
The new prime minister said though he plans to take a strong stand with China and its other neighbors, he also seek to improve relations with Beijing.
Since assuming power last year, the outgoing prime minister struggled to contend with the country's economic struggles.

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