Japan’s Finance Minister has said that he will resign later this year amid a spiralling furore over what appeared to be drunken behaviour at last weekend’s G7 summit in Rome.

Shoichi Nakagawa’s resignation could not come at a more fragile time for the government of Prime Minister Taro Aso – a leader who is fast becoming Japan’s most unpopular ever, and who stands accused by the public of dithering on solving the country’s rapidly deteriorating economic problems.

Mr Nakagawa’s decision to step down came ahead of an opposition-led censure motion against him, which he will almost certainly lose tomorrow.

Mr Nakagawa, who was sticking today with his excuse that a combination of jetlag and cough mixture got the better of him, said that he would stay on in the Cabinet until parliament gave the green light to a supplementary budget aimed at steering Japan out of the sharpest recessionary plunge in its history.

A number of politicians have come forward today with annecdotal evidence of Mr Nakagawa's odd behaviour – he has, for example, been spotted bumping into the doorframes along the corridors of power.

Kenji Yamaoka, head of the parliamentary affairs committee of the opposition Democratic Party of Japan, said yesterday that there was "nobody in the Diet [parliament] who did not know" about Mr Nakagawa's fondness for a tipple.

Video footage has also surfaced of an incident in parliament in 2006 when Mr Nakagawa stopped speaking during a speech and stood silent and virtually motionless for about half a minute before sitting down. At the time, he blamed medicine he was taking for back pain.

Monday’s quarterly GDP figures showed Japan’s exports – the engine of national growth – sliding at record pace. Tokyo stocks tumbled on the combined miseries of an economy in distress and the lack of a steady rudder in government.

In addition to the growing financial turmoil gripping Japan, over the past three years the leadership of the country has changed three times, with countless cabinet reshuffles and resignations in between.

No names have been suggested as a replacement for Mr Nakagawa, whose departure will leave a “talent void” in the ruling Liberal Democratic Party, analysts say.

In a hastily convened press conference today, Mr Nakagawa apologised “for causing such a big fuss”. But in what appeared to be confirmation of public and parliamentary suspicions that he was indeed drunk during his Rome press conference, he hinted that may soon hospitalise himself to “prevent myself doing any further damage”.

Rumours regarding Mr Nakagawa’s fondness for alcohol have been swirling in political circles for many years. The former prime minister, Yoshiro Mori, said yesterday that he was aware of the Finance Minister’s fondness for a drink and had previously warned him not to overdo things.

Although Mr Aso said today that he had no plans to sack his close confidant and ally, Mr Nakagawa’s performance in Rome has already drawn heavy criticism from other members of the Cabinet.

“The TV footage was shocking,” Seiko Noda, the Consumer Minister, said. “A Cabinet minister must be fit and he needs more self control.”

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