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Cablegate: Japanese Morning Press Highlights 11/30/07

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UNCLAS SECTION 01 OF 12 TOKYO 005388

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DEPT FOR E, P, EB, EAP/J, EAP/P, EAP/PD, PA;
WHITE HOUSE/NSC/NEC; JUSTICE FOR STU CHEMTOB IN ANTI-TRUST DIVISION;
TREASURY/OASIA/IMI/JAPAN; DEPT PASS USTR/PUBLIC AFFAIRS OFFICE;
SECDEF FOR JCS-J-5/JAPAN,
DASD/ISA/EAPR/JAPAN; DEPT PASS ELECTRONICALLY TO USDA
FAS/ITP FOR SCHROETER; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR;
CINCPAC FLT/PA/ COMNAVFORJAPAN/PA.

E.O. 12958: N/A
TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA

SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 11/30/07


Index:

1) Top headlines
2) Editorials
3) Prime Minister's daily schedule (Nikkei)

Diet in turmoil:
4) New antiterrorism bill to allow MSDF refueling to continue in the
Indian Ocean finally being deliberated in the Upper House committee,
but outlook is bleak (Mainichi)
5) With new MSDF refueling bill facing gridlock, proposal floated to
let Lower House speaker use his good offices to try to broker a
resolution (Nikkei)
6) Japanese Communist Party throws monkey wrench into DPJ's strategy
by balking at the summoning of Finance Minister Nukaga as a sworn
witness (Mainichi)
7) Growing mood of caution in the ruling camp about re-extending the
Diet session in order to force passage of the antiterrorism bill
(Mainichi)

Political voices:
8) Shoichi Nakagawa forms new lawmakers' study group to bring
conservative forces together in the Diet (Mainichi)

Defense scandal deepens:
9) Former Vice Defense Minister Moriya, now under arrest, used clout
to land Yamada Corp. a contract for GSDF equipment at a padded price
(Mainichi)
10) Moriya even arranged meeting with GE executives in order to
steer engine contract to his favorite defense equipment trader
(Yomiuri)
11) Defense contractor Yamada Corp. pumped 100 million yen into a
defense policy experts group (Asahi)
12) Former Pentagon Japan desk director James Auer, in Tokyo, once
more denies ever having dinner with former defense chief Nukaga, as
DPJ charges (Sankei)

Defense secrets issue:
13) US protest about leakage of secrets led MSDF to halt inspection
of Aegis vessel by visiting Chinese military brass (Yomiuri)
14) Government considering new secrets protection law that would
apply to civilians, as well as government and military personnel
(Sankei)

15) Government's policy stance on North Korea's nuclear plan report
requires inclusion of uranium enrichment project, as well (Yomiuri)


Environmental protection aid:
16) Japan, China to establish environment fund that would replace
yen loans (Mainichi)
17) Government introducing new environmental-protection scheme in
Indonesia's aid package (Sankei)

Articles:

1) TOP HEADLINES

Asahi:
Yamada Corp. provides 100 million yen to group linked with lawmakers
engaged in defense policies


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Mainichi:
Former Vice-Defense Minister Moriya suspected of influencing
contracts for Ground Self-Defense Force equipment

Yomiuri:
Moriya suggests General Electric be picked for supplier of destroyer
engines

Nikkei:
Japan Post plans to cut 24,000 jobs, or 10 PERCENT of entire
payrolls, in four and half years

Sankei:
Justice Ministry to announce names of executed death row inmates

Tokyo Shimbun:
Moriya allowed Nihon Mirise representative to attend CX meeting

Akahata:
Kyuma ordered 12 discretionary contracts during his tenure as
defense chief

2) EDITORIALS

Asahi:
(1) Agreement reached between ruling and opposition blocs to
disclose political funds
(2) Port call by Chinese naval vessel: First step toward new
history

Mainichi:
(1) We want to hear former Prime Minister Koizumi's comment on
Moriya's crime
(2) Political Funds Control Law must be revised speedily to
eliminate loopholes

Yomiuri:
(1) Don't summon witnesses just to ling mud
(2) Middle East peace talks: U.S. role most important

Nikkei:
(1) Middle East peace talks test U.S. leadership
(2) Agreement on political funds a huge step forward

Sankei:
(1) Nukaga's testimony requires second thought
(2) Apply pressure on Russia for return of Northern Territories

Tokyo Shimbun:
(1) Politics and money: Greater transparency essential
(2) Postal delivery services: Give full consideration to depopulated
areas

Akahata:
(1) Redeployment of SDF must not be allowed

3) Prime Minister's schedule, November 29

NIKKEI (Page 2) (Full)
November 30, 2007

09:28

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Met at Kantei with METI Minister Amari and Vice METI Minister
Kitabata.

10:01
Met with Welfare Minister Masuzoe. Met later with Lower House
members Mitsuo Horiuchi and Yoshitaka Murata.

11:02
Met with Economic and Fiscal Policy Minister Ota.

13:00
Attended convention of the Central Federation of Societies of
Commerce and Industry held in NHK Hall.

14:52
Met at Kantei with Chief Cabinet Secretary Machimura. Met afterwards
with Internal Vice Defense Minister Masuda, followed by Deputy Chief
Cabinet Secretary Futahashi.

16:07
Met Nikkei columnist Yasuhiro Tase at LDP headquarters to have a
talk, which will be put in the party's organ paper's New Year's
issue.

17:22
Met at Kantei with Internal Affairs Minister Masuda, followed by
Vice Foreign Minister Yachi and Assistant Deputy Chief Cabinet
Secretary Ando.

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19:26
Returned to his private residence Nozawa.

4) Upper House Defense Committee begins discussing new antiterrorism
legislation

MAINICHI (Page 2) (Full)
November 30, 2007

The House of Councillors Foreign Affairs and Defense Committee began
yesterday deliberating on the new antiterrorism special measures
bill to resume the Maritime Self-Defense Force's refueling operation
in the Indian Ocean. Given the arrest the previous day of former
Administrative Vice-Defense Minister Takemasa Moriya, the session
has taken on an aspect of pursuing suspicions involving the Defense
Ministry. In the House of Representatives, deliberations were
conducted at a special committee. The Upper House Foreign Affairs
Committee is originally a venue to discuss diplomatic issues, such
as North Korea policy. If the pursuit of allegations drags on,
deliberations on mounting pending issues might be left behind.

"The matter of top concern was supposed to be what Prime Minister
Fukuda discussed with President Bush in the summit (on Nov. 15)
regarding the abduction issue." Thus an Upper House Liberal
Democratic Party member indicated that the committee is supposed to
discuss such diplomatic issues as how the question of Japanese
nationals abducted by the North was discussed at the summit and a
response to the United States' move to delist North Korea as a state
sponsor of terrorism.

The ruling camp intends to urge strongly the Democratic Party of
Japan (Minshuto or DPJ) to come up with a counterproposal to the new
antiterrorism legislation. The DPJ, however, is certain to find it

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difficult to produce a unified view. There is no prospect that the
largest opposition party can submit a counterproposal to the Diet in
the current session.

5) Proposal being floated for breaking Diet deadlock over new
antiterrorism bill by using good offices of Lower House speaker and
Upper House president; Ruling and opposition camps worried about
early Lower House dissolution

NIKKEI (Page 2) (Excerpts)
November 30, 2007

In connection with a bill to resume the Maritime Self-Defense
Force's refueling operation in the Indian Ocean, the notion being
floated is to seek a breakthrough in the standoff by using the good
offices of House of Representatives Speaker Yohei Kono and House of
Councillors President Satsuki Eda. This is because the Dec. 15
closing of extended current Diet session is approaching with no
prospect for a solution in sight. Due to the divided Diet,
deliberations on the new antiterrorism bill have not been moved
ahead, and all those involved appear to be concerned about public
criticism of Diet management erupting.

Chief Cabinet Secretary Nobutaka Machimura stated in a press
conference yesterday: "(Passing the bill before the end of the Diet
session) is the highest priority." In the backdrop of his remark is
the fact that an early resumption of the MSDF refueling operation
has become Japan's commitment to the United States since Prime
Minister Fukuda pledged it in his summit with President George W.
Bush.

Meanwhile, Ichiro Ozawa, president of the main opposition Democratic
Party of Japan (DPJ or Minshuto), when asked yesterday on a TV Asahi
program about his view on the possible timing of a dissolution of
the Lower House for a general election, replied y: "What will happen
with the new antiterrorism bill will become the criterion for making
a decision." When asked whether his party would submit a censure
motion against the prime minister, he emphasized: "It depends on
whether the (ruling camp) will ram the bill through the Diet by
extensively extending the session."

Contrary to the standoff between the ruling and opposition camps,
the fact that the two sides want to avoid an early dissolution of
the Lower House has complicated the matter. The reason is that
neither camp is fully prepared for the next Lower House election and
able to read public opinion.

Against the backdrop of growing expectations for using the good
offices of the Lower House speaker and Upper House president, there
is a hidden motive that the occasion will propel the ruling and
opposition blocs to find common ground. The Lower House speaker and
Upper House president are expected to urge the secretaries general
of the ruling and opposition parties to speed up deliberations on
the new antiterrorism bill.

6) DPJ plunging into confusion over requiring Nukaga's testimony,
and is now drawing fire from PNP; JCP admits decision was mistake

MAINICHI (Page 2) (Excerpts)
November 30, 2007

The opposition bloc previously unilaterally decided to demand Diet

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testimony by Finance Minister Fukushiro Nukaga and forcer
Administrative Vice-Defense Minister Takemasa Moriya (in connection
with the defense procurement scandal). The Japanese Communist Party
admitted yesterday that this decision was a mistake, with the
party's Diet Affairs Committee Chairman Keiji Kokuta saying, "The
unanimity rule must be upheld." This has charge up the ruling camp,
as seen in an Upper House Liberal Democratic Party executive's
comment: "Such is natural. The Democratic Party of Japan will have
to lower its fist and postpone the planned Diet testimony." The
future of the planned Diet testimony over Nukaga's alleged presence
at a dinner party, along with a former defense contractor executive,
is becoming even murkier, fueled by the arrest of Moriya.

The Upper House Finance Affairs Committee has 25 directors: 13 seats
going to the DPJ, 9 to the LDP, 2 to the New Komeito, and 1 to the
JCP. Even if the JCP changes its stance, the decision will remain
unchanged. The DPJ parliamentary group in the Upper House has 119
members. In order for it to secure a majority (122 persons), it
needs the cooperation of the JCP (7) or the Social Democratic Party
(5).

Although the JCP admitted the mistake, Chairman Kazuo Shii also
indicated that if the testimony was to be conducted on Dec. 3., as
scheduled, his party would not boycott it. At the same time, Shii
said, "The Diet testimony should not be carried out forcibly."
Shizuka Kamei, deputy representative of the People's New Party,
which forms the Upper House parliamentary group with the DPJ, also
told the press in a critical tone in the Diet building: "What would
happen if the House of Representatives (which is controlled by the
ruling bloc) unilaterally decided on Diet testimony? Such a thing
should not be carried out in either chamber."

Given the situation, a senior DPJ Lower House Diet Affairs Committee
member complained: "Discord among the opposition parties would make
it difficult to conduct the planned Diet testimony." The DPJ
initially planned to summon Nukaga and Moriya at the same time to
let them lock horns over the gap in their views on Nukaga's presence
at the dinner party. The DPJ's plan has now fallen through due to
Moriya's arrest.

7) Some in ruling bloc cautious about re-extending the current
session of Diet, out of concern for a possible dissolution of Lower
House

MAINICHI (Page 5) (Excerpts)
November 30, 2007

Hirofumi Oniki

Coordination is underway in the government and the ruling parties,
which are trying to enact into law during the current session of the
Diet a new antiterrorism special measures bill, to re-extend the
current Diet session, which is to close on Dec. 15. But some in the
ruling bloc are against re-extending the session, out of fear that a
re-extension of the Diet session could lead to dissolving the Lower
House for a snap general election. With a confrontational mood
growing between the ruling and opposition blocs as to whether to
summon as witnesses to the Diet former Administrative Vice Defense
Minister Takemasa Moriya, who was involved in the bribery case, and
Finance Minister Fukushiro Nukaga, who is alleged to have been
present at a dinner party in dispute, it is becoming increasingly
uncertain what will happen in the Diet in the days ahead.

TOKYO 00005388 006 OF 012

"There is no call for starting over again from the beginning. It's
not too much to say that passing the (new antiterror bill) into law
is an absolute must for the Fukuda cabinet," Chief Cabinet Secretary
Nobutaka Machimura said at a press briefing yesterday and
highlighted his resolve to enact the bill into law during the
current Diet session.

Meanwhile, the major opposition Democratic Party of Japan (DPJ) and
other opposition parties have given priority to throwing light on
the allegations involving Moriya and Nukaga. At a board meeting
yesterday of the Upper House Committee on Foreign Affairs and
Defense, the ruling coalition sought to start a question-and-answer
session on Dec. 4, but the DPJ and other opposition parties insisted
on questioning outside of the Diet suspect Motonomu Miyazaki, a
former executive of the defense trading firm Yamada Corp. As a
result, no agreement was reached between both sides.

With a growing confrontational mood between the ruling and
opposition blocs, some in the ruling parties are becoming cautious
about re-extending the Diet session in order to avoid the case of
suddenly dissolving the Lower House for a snap general election as
(DPJ President Ichiro Ozawa has mentioned) a "sudden dissolution of
the Lower House." The ruling Liberal Democratic Party's (LDP)
Tsushima faction's Chairman Yuji Tsushima noted at his faction's

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general meeting yesterday: "A budget bill must be created and
passed. I hope (the prime minister) will keep this point in mind in
managing the Diet." Tsushima thus indicated caution about broadly
extending the Diet session on the grounds that another round of
extension of the Diet session could affect the process of compiling
a budget bill for 2008.

One senior member of the junior coalition partner New Komeito also
noted, "The current Diet session should be closed as scheduled and
then we should start over again from the beginning in the upcoming
ordinary session of the Diet." Another senior New Komeito member
suggested: "It may be a good idea to give time to the DPJ so that it
can come up with a counterproposal."

8) LDP's Shoichi Nakagawa holds a charter meeting of group rallying
together conservatives

MAINICHI (Page 5) (Excerpts)
November 30, 2007

Eriko Horii

The ruling Liberal Democratic Party's (LDP) former Policy Research
Council Chairman Shoichi Nakagawa and other lawmakers yesterday held
a charter meeting in the Diet of a new study group aimed at rallying
conservative forces together. Joining the meeting were 23 LDP
lawmakers and former Minister of Economy, Trade and Industry Takeo
Hiranuma, who left the LDP in opposition to the privatization of the
postal services. Ahead of the first meeting of the study group
slated for Dec. 4, Nakagawa and Hiranuma were chosen as chairman and
supreme advisor respectively. Because the core members of the study
group are those lawmakers who backed up former LDP Secretary General
Taro Aso in the September LDP presidential election, some in the LDP
are alert to the move of the study group with one member saying,
"The group may aim to discourage the Fukuda administration."

In the meeting, Nakagawa said: "We must not forget what all of us

TOKYO 00005388 007 OF 012


said several months ago 'we should do.'" He indicated his intention
to work hard to translate such policies as revitalization of
education into action in line with the "departure from the postwar
regime" as called for by former Prime Minister Shinzo Abe. Nakagawa
also noted: "I will give full support to Prime Minister Yasuo Fukuda
and the party executives, including Secretary General Bunmei
Ibuki."

The lawmakers who attended the founders' meeting were as follows:

LDP

House of Representatives members:
Yasuhide Nakagawa, Yasutoshi Nishimura, and Koichi Hagiuda from the
Machimura faction; Taimei Yamaguchi and Toru Toida from the Tsushima
faction; Yoshihisa Furukawa from the Yamasaki faction; Shoichi
Nakagawa, Keiji Furuya, Toshio Kojima, Kiyoshi Ono and Kenta
Matsunami from the Ibuki faction; Kentaro Sonoura from the Aso
faction; and Yoshinobu Shimamura, Kenichi Mizuno, and Yoji Muto
from, who are not members of any faction.

House of Councilors members:
Nobuto Kishi and Shoji Nishida from the Machimura faction; Yoshio
Nakagawa, Tsukasa Akimoto and Seiichi Eto from the Ibuki faction;
and Yoshitada Konoike, Katsuhito Asano and Ichiro Tsukada from the
Aso faction.

Independent
House of Representatives member: Takeo Hiranuma

9) Moriya may have given favors to Yamada subsidiary regarding GSDF
equipment, forcing agency to conclude discretionary contract for
price 300 million yen higher than plan

MAINICHI (Top play) (Excerpts)
November 30, 2007

It was discovered that former Administrative Vice-Defense Minister
Takemasa Moriya, 63, who has been arrested on suspicion of taking
bribes, in 2005 instructed his subordinate to procure devices for
the Ground Self-Defense Forces' biological reconnaissance vehicles
from a subsidiary of Yamada Corp., a trading house specializing in
defense equipment. Moriya allegedly pressed the subordinate, who was
trying to consider procuring the devices from a different trading
firm, by telling him to conclude a discretionary contract with the
Yamada subsidiary and forced the then Defense Agency to purchase
them for over 1.5 billion yen, 300 million yen higher than the
planned budget. Aware of the sequence of such events, the special
investigation squad of the Tokyo District Prosecutors Office seems
to be pursuing the case, believing that Moriya did a favor for
Yamada in return for being treated to free golf.

The device is designed to detect biological agents, such as anthrax.
According to sources familiar with the case, the GSDF and the former
Defense Agency Planning Division decided in 2003 to purchase
equipment made by Smiths Detection of Britain, for which Yamada's
subsidiary Nihon U.I.C. was serving as the Japanese agent, and
earmarked in its fiscal 2004 budget approximately 1.23 billion yen
for four sets of the devices.

But in around November 2004, the subsidiary demanded a price hike,
citing changes in design. As a result, the official in charge tried

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to look for products by a different manufacture. Learning of such a
move, Moriya in around February 2005 told the official, "The
decision has already been made, so why don't you conclude a
discretionary contract?" The planned study was cancelled, and in
March 2005 the agency concluded a discretionary contract for about
1.53 billion yen.

10) Moriya suspected of providing favors to defense contractor in
connection with destroyer engine, suggesting procurement of GE-made
product; Arranges meeting with executives of GE, responding to
Miyazaki request

YOMIURI (Top Play) (Lead para.)
November 30, 2007

Yomiuri Shimbun has learned that Takemasa Moriya (63), the former
administrative vice defense minister who was arrested on the charge
of bribery involving procurement of defense equipment, once arranged
a meeting with executives of General Electric of the US, which was a
candidate supplier of engines for the Maritime Self-Defense Force's
next-generation destroyer, responding to a request from Motonobu
Miyazaki (69), former executive director of Yamada Yoko, a defense
contractor. The meeting took place in December last year, a time
when Miyazaki was maneuvering to become GE's agent, after leaving
Yamada Yoko (to form his own company). After the meeting Moriya made
a remark to his subordinates using a tone that could be taken as
persuading them to introduce GE products. The special investigation
squad of the Tokyo District Public Prosecutors Office is now
investigating the case, suspecting that Moriya gave business favors
to Miyazaki in return for his entertaining him with golf outings.

11) Yamada Yoko suspected of paying 100 million yen to organization
headed by organization headed by member of defense policy clique in
Diet: Paper recording payment for cooperation for receiving of order
for disposing of poisonous gas shells

ASAHI (Top Play) (Excerpts)
November 30, 2007

Asahi Shimbun has obtained as of Nov. 29 a document indicating that
Yamada Yoko, a trading house specializing in military procurement,
paid a total of 900,000 dollars (approximately 100 million yen) as
cooperation expenses to a US organization connected to Naoki
Akiyama, permanent director of Japan-US Center for Peace and
Cultural Exchange (Japan-US CPCE), in connection with the receiving
of an order for the work of disposing of poisonous gas shells
abandoned by the former Imperial Japanese Army. A Yamada Yoko source
familiar with this circumstance said that Yamada Yoko prepared the
document.

In connection with the alleged embezzlement of corporate funds by
former Yamada Yoko executive director Motonobu Miyazaki (69),
rearrested on suspicion of giving bribes to former Administrative
Vice Defense Minister Takemasa Moriya (63), the special
investigation squad of the Tokyo District Public Prosecutors Office
is searching the office of the Japan-US CECE, where Miyazaki served
as director until last year. Public prosecutors are reportedly
keeping close tabs on the flow of funds involving the Japan-US CECE,
where influential defense policy specialist lawmakers have served as
director. Responding to a request for an interview by an Asahi
Shimbun reporter, Akiyama replied in writing that there was no such
payment. This news paper also sent a questionnaire in writing to

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Yamada Yoko, but there was no reply.

12) James Auer: Nukaga was not present (at dinner along with
Moriya)

SANKEI (Page 5) (Full)
November 30, 2007

James E. Auer, a former U.S. Defense Department Japan Desk director,
yesterday held a press conference at Liberal Democratic Party (LDP)
headquarters in Nagatacho, Tokyo, in which he said that Finance
Minister Fukushiro Nukaga was not present at a dinner party along
with former Vice Defense Minister Takemasa Moriya, which was held on
Dec. 4 last year at the Japanese restaurant Hamadaya in Ningyocho,
Tokyo.

Auer said that he was invited to the dinner by Keiichi Manda,
director of the international relations association. He then stated:
"I met Mr. Nukaga in his office but I have never had dinner, lunch,
or breakfast with him."

Asked about Moriya's testimony before the Diet that Nukaga joined
the dinner, Auer said: "I don't know about that. Why don't you ask
Mr. Moriya?" As to the question of whether the topic of the
procurement of defense equipment came up during the dinner, he
stated: "My specialty is defense policy. So I don't know about
equipment at all."

13) MSDF canceled plan to show Aegis ship to Chinese military due to
U.S. protest

YOMIURI (Page 1) (Abridged)
November 30, 2007

The Maritime Self-Defense Force cancelled its plan to invite Chinese
military personnel to tour its Aegis ship because of a protest from
U.S. Forces Japan and others concerned, sources revealed yesterday.
The Chinese military personnel are crewmen aboard a warship that is
making a port call in Japan as part of defense exchanges between
Japan and China. The MSDF planned to show the Kirishima, a 7,250-ton
Aegis-equipped vessel, to the Chinese military. The U.S. military
was concerned about the possibility of defense-secret leaks. The
MSDF changed the plan to show a supply ship instead, and the tour
will take place this morning.

Japan and China held a meeting of their defense ministers in August,
when the two countries agreed on a mutual visit plan for MSDF and
Chinese naval vessels. As the first Chinese warship to visit Japan,
the Shenzhen, a 6,000-ton missile destroyer of the Chinese navy with
350 crewmen onboard, arrived at Tokyo's Harumi pier on Nov. 28.

The Shenzhen is scheduled to stay in Japan until Dec. 1. The
commanding officer and more than a dozen naval brass officers aboard
the visiting Chinese warship are scheduled to visit the MSDF's
Yokosuka District Headquarters in the city of Yokosuka, Kanagawa
Prefecture, on the morning of Nov. 30. They had proposed visiting
the Kirishima, which is homeported at Yokosuka base and belongs to
Escort Flotilla 1, on the occasion of their Yokosuka visit.

USFJ and the U.S. Embassy in Tokyo learned of the visit plan on Nov.
28 and then inquired of the Defense Ministry and the Foreign
Ministry about the plan and requested them to call it off, according

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to government sources. The Defense Ministry cancelled the Kirishima
visit and decided to show the group the Tokiwa, a supply ship that
returned home on Nov. 23 from its Indian Ocean refueling mission.

Commentary: U.S. distrusts Japan over confidentiality

In January this year, an information leakage incident was brought to
light. In that event, an MSDF member assigned to Escort Flotilla 1,
an MSDF unit based at Yokosuka, Kanagawa Prefecture, took out
Aegis-related defense secrets without permission. The United States
requested Japan to tighten information security. In August, the
Japanese and U.S. governments concluded a general security of
military information agreement (GSOMIA).

There were such circumstances in the past. Concerning the Chinese
naval plan to visit an MSDF Aegis ship, a U.S. diplomatic source
voiced a growing sense of distrust about Japan's optimistic
awareness of information security. "The leakage of information about
an Aegis ship became a problem," the source said. "That's why the
United States is very nervous," the source added, "so it's
absolutely unacceptable."

14) Gov't eyes creating new law to protect secrets

SANKEI (Page 2) (Abridged)
November 30, 2007

With an increasing number of technologies convertible for military
use, the Ministry of Economy, Trade and Industry is planning to make
a list of technologies that should not be transferred or publicized,
officials said yesterday. METI will ask its advisory panel to
discuss the plan. After that, the government will create a new law
to protect secrets with increased penalties for public service
personnel's leakage of secrets and tightened regulations for
private-sector personnel. The government will present a bill to the
Diet at its ordinary session in 2009.

Under the current legal system, criminal penalties are imposed on
public service personnel and nuclear power companies that leak
defense secrets or nuclear power plant protection secrets. Even in
the case of those who leak confidential information about
nuclear-related technologies that can be diverted to military use,
they will be accused of breaching confidentiality under the National
Public Service Law. They will only get one year or less.

In the case of leaking information about technologies in the private
sector, there is no problem even if information concerning national
security is leaked. METI will set up a study group involving
scholars and corporate officials. The group will hold its first
meeting today and will study ways to tighten regulations.

15) Japan intends to call for inclusion of uranium enrichment
program in DPRK's declaration of its nuclear programs

YOMIURI (Page 2) (Full)
November 30, 2007

The government yesterday determined its attitude toward the planned
meeting of the chief representatives to the six-party talks on the
North Korean nuclear issue slated for early December. Regarding the
focal issue of North Korea's declaration of its nuclear programs,
Japan will make it the essential conditions for approval to include

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"extracted plutonium," "nuclear weapons," and "uranium enrichment
program." The joint statement as agreed on in October of the
six-party talks states that North Korea should disable its three
nuclear facilities in Yongbyon and declare all its nuclear programs
thoroughly and accurately by the end of December.

According to a senior Foreign Ministry official, the process of
disabling the three nuclear facilities in Yongbyon, where plutonium,
one material for nuclear bombs, had been extracted, is "going
smoothly." So attention is now shifting to the contents of the
declaration of nuclear programs. North Korea is expected to submit a
list ahead of its declaration of its nuclear programs, but the North
has reportedly expressed disapproval of including existing nuclear
weapons in the declaration of nuclear programs. Also, the North has
not officially admitted to an uranium enrichment program.

16) Japan-China environment fund to be set up to finance projects in
place of yen loans

MAINICHI (Page 1) (Excerpts)
November 30, 2007

Beijing, Takuya Otsuka

It has been learned that the governments of Japan and China are
looking into the possibility of setting up a joint fund to extend
financial assistance for energy-conservation and
environmental-protection projects in China. More than one
Japan-China diplomatic source revealed the plan. Japan's yen loans
have thus far financed environmental cooperation to China, but the
scheme will end this fiscal year. Accordingly, the government will
secure funds to finance projects with low profitability, as it is
difficult for private banks to do so.

Tokyo and Beijing want to play up bilateral cooperation at the Lake
Toya Summit to be held in Hokkaido next year, where global warming
preventive measures will take the center stage. China's National
Development and Reform Commission and the Japanese government are
now undertaking coordination. They are expected to work out concrete
proposals, including the size of the envisaged fund and their shares
of funds by the time when Chinese President Hu Jintao visits Japan
next spring.

Aforestation to prevent desertification and consolidation of
sewerage systems are envisaged as projects eligible for financial
assistance. The size of the planned fund is estimated to reach at
least billions of yen. Chances are that if government-to-government
talks on joint development of gas fields in the East China Sea make
progress, projects related to the joint gas field development could
also become eligible for financial assistance.

17) Global warming preventive measures: Government likely to reach
agreement with Indonesia for first time, based on fund mechanism

SANKEI (Page 3) (Excerpts)
November 30, 2007

It was found on Nov. 29 that the government will likely reach an
agreement with Indonesia shortly on financial assistance to that
nation, based on the fund mechanism it has mapped out with
developing countries working to come up with measures to prevent
global warming in mind. The government will extend assistance valued

TOKYO 00005388 012 OF 012


at more than 10 billion yen in the form of yen loans for such
projects as boosting geothermal generation. It will formally
announce the agreement at the 13th session of the Conference of the
Parties to the Climate Change Convention (COP13) to be started on
Bali, Indonesia, on Dec. 3. It wants to play up the fund mechanism
to participating countries.

The fund mechanism was incorporated as one key proposal in Cool
Earth 50, a strategy on climate change the government released in
May. Under the fund mechanism, developing countries apply for
assistance for their measures to prevent global warming and present
programs to implement measures to prevent disasters caused by
climate change and promote energy-conservation plans. The Japanese
side then examines the propriety of the proposed measures and
decides whether to finance them or not. The aim is to urge
financially beleaguered developing countries to adopt sustainable
global warming preventive measures. This is the first time for the
government to reach an agreement based on the fund mechanism.

SCHIEFFER

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