Nationalist Shinzo Abe easily won election in parliament to become Japan's youngest postwar prime minister Tuesday, pledging to plow ahead with economic reform, rein in spending and pursue better relations with China.

Abe, 52, a proponent of a robust alliance with the United States and a more assertive Japanese military, clinched strong majorities in both houses of parliament, reflecting the hold his ruling Liberal Democratic Party has on government.

The new prime minister stocked his new Cabinet with a wide range of fellow conservatives, including Taro Aso, who will keep his post as foreign minister, and veteran Fumio Kyuma, appointed to a second stint as defense chief.

"I'd like to make Japan a country that abounds with dynamism, opportunity and kindness," Abe declared in nationally televised comments.

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The heir apparent to outgoing Prime Minister Junichiro Koizumi for about a year, Abe came to office as a champion of the security pact with top ally the United States, revision of the pacifist constitution, a more outspoken foreign policy, and more patriotic education.

One of his top challenges will be repairing Japan's deteriorating ties with China and South Korea. Beijing and Seoul on Tuesday reacted cautiously to Abe's election, calling for the new Japanese government to take steps to improve relations.

"China is a very important country for Japan, and China's development is a plus also for Japan," Abe said. "I will work to further develop relations between Japan and China."

The new government will also have to find ways of maintaining the economy's recovery from a decade-long slowdown, and grappling with troubles related to the rapidly aging population.

Abe pledged to pursue both economic growth and fiscal reform, offering to cut his own pay by 30 percent and those of his Cabinet by 10 percent to demonstrate his commitment to trimming the budget.

His government immediately declared that the prime minister — not the powerful bureaucracy — would direct policy.

"The Prime Minister's Office should be strengthened as the control center for the whole state," said incoming Chief Cabinet Secretary Yasuhisa Shiozaki. "The office will put forward policies based on strategic thinking."

The new prime minister faces the further challenge of filling the shoes of Koizumi, who pushed through major economic reforms, backed a groundbreaking dispatch of soldiers to Iraq, and brought Japanese politics into the modern media age in his five years at the helm.

It was not clear, however, whether Abe's Cabinet selections would chart a bold new course for Japan.

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A prominent former prime minister, Yasuhiro Nakasone, called the choices "safe," and Abe faced early criticism that he favored those with close ties to himself or to ruling party cliques, rather than more original policy specialists.

"There is nothing new we can expect in the country's diplomacy from this Cabinet," said Takehiko Yamamoto, professor of international politics at Tokyo's prestigious Waseda University.

"What we observe at the moment is that it will follow Koizumi's diplomacy: a firm alliance with the U.S.," he added.

On the financial side, Abe named economist Hiroko Ota as economy minister, and former economic planning chief Koji Omi as finance minister.

The new government will also have several new Cabinet portfolios: solving North Korea's abductions of Japanese citizens, retraining laid-off workers and others, technological innovation, and regional economic revitalization.

Abe signaled the primary directions of his government on Monday by choosing pro-growth fiscal conservative Hidenao Nakagawa and fellow nationalist Shoichi Nakagawa to two top posts in the ruling Liberal Democratic Party.

Aso, returning for a second stint as foreign minister, set a summit with China at the top of the agenda for the new government.

"Now that we have new Prime Minister Abe, we will make efforts to achieve summit talks between the new prime minister and Chinese President Hu Jintao," Aso said.

Momentum has been building for such a meeting. Japan and China held vice-ministerial talks this week, and Aso met on Monday with Chinese Vice Foreign Minister Dai Bingguo in Tokyo. The two agreed relations between Japan and China are "at an important period," the Foreign Ministry said.

Japan and China are at odds over interpretations of wartime history, exploitation of maritime resources, and island territories.

Hu has refused to meet with Koizumi since last year over his visits to the Yasukuni war shrine, which honors war criminals among Japan's war dead and is considered by critics to be a glorification of Tokyo's past militarism.

On Tuesday, Chinese Foreign Ministry spokesman Qin Gang urged Abe to pursue better ties, and made a veiled reference to Yasukuni as a reason for the troubles between the two.

"The Chinese government attaches great importance to ties with Japan," Qin said. "At present, there are obstacles to bilateral ties. The reasons are quite clear and the Japanese government is aware of them."

Abe has relatively little experience in government. He worked as an aide to his politician father Shintaro Abe, and then was elected to parliament in 1993, but was little known until he took the lead in 2002 in negotiating the release of Japanese abducted by North Korea.

Koizumi gave Abe his first Cabinet posting just last year, naming him to the high-profile position of chief Cabinet Secretary.

Koizumi left the Prime Minister's Office early Tuesday to cheers, holding a bouquet of roses.

"There is no end to reform," Koizumi said in a parting statement.