Japan's Prime Minister Junichiro Koizumi has named leading conservative Shinzo Abe as chief government spokesman in a cabinet reshuffle.
Shinzo Abe is known as an outspoken conservative
The appointment means Mr Abe is well placed to succeed Mr Koizumi if he steps down as party leader next September, which he has pledged to do.
The important foreign affairs portfolio has been given to another conservative, former Home Affairs Minister Taro Aso.
The reshuffle follows Mr Koizumi's victory in last month's election.
The prime minister's appointments were closely watched for clues as to his priorities for the remainder of his term as leader, as well as pointing to his potential successor.
Sadakazu Tanigaki, seen as one of a handful of politicians jockeying to take over from Mr Koizumi, is to retain his post as finance minister.
Heizo Takenaka, a key figure for the ruling Liberal Democrat Party (LDP) on banking reform and postal privatisation, has been made internal affairs, communications and postal reforms minister.
Shinzo Abe: Chief cabinet secretary - effectively Koizumi's No 2. Foreign policy hawk and popular with women
Taro Aso: Foreign minister. Visitor to controversial Yasukuni war shrine, which upsets China and S Korea
Sadakazu Tanigaki: Finance minister (retained). Seen as another potential Koizumi successor. Low-key image
Heizo Takenaka: Internal affairs minister. Key architect of Koizumi's controversial postal reforms
However Yasuo Fukuda, who had been tipped as a leadership contender, has been left out of both the cabinet and key party posts.
The appointment of Mr Abe, the LDP's deputy secretary general, as chief cabinet secretary and government spokesman effectively makes him Mr Koizumi's right-hand man.
Speaking at a press conference to name the new cabinet, the 51-year-old brushed off speculation over the party's future leadership.
"I have never thought of myself as a Koizumi successor," Mr Abe said.
A grandson of former Prime Minister Nobusuke Kishi, he is best known for taking a tough line on North Korea over its abductions of Japanese citizens in the 1970s and 80s.
Mr Abe has also supported Mr Koizumi's visits to the controversial Yasukuni war shrine, seen by China and South Korea as a symbol of Japan's World War II militarism.
New Foreign Minister Taro Aso, 65, has also visited the shrine, and his appointment is unlikely to please China.
He succeeds Nobutaka Machimura, whose term focused on relations with China and Japan's negotiations to win a permanent seat on the UN Security Council.
Mr Aso, a grandson of the late Prime Minister Shigeru Yoshida, has previously held the portfolios for internal affairs and communications and the economy.
The role of defence minister goes to Fukushiro Nukaga, who will take on responsibility for overseeing the reorganisation of US military forces in Japan.
Toshihiro Nikai, the new trade minister, is likely to face the challenge of settling a dispute with China over gas exploration in the East China Sea.