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Cablegate: Japan-Asean Fta Ratification Temporarily Stalled

VZCZCXRO2765
PP RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHKO #1549 1580717
ZNR UUUUU ZZH
P 060717Z JUN 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 4841
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 3762
RUEHBY/AMEMBASSY CANBERRA 2647
RUEHPE/AMEMBASSY LIMA 0413
RUEHME/AMEMBASSY MEXICO 0524
RUEHMO/AMEMBASSY MOSCOW 2336
RUEHOT/AMEMBASSY OTTAWA 9674
RUEHSG/AMEMBASSY SANTIAGO 0167
RUEHUL/AMEMBASSY SEOUL 9761
RUEHWL/AMEMBASSY WELLINGTON 1032
RUEHHK/AMCONSUL HONG KONG 6535
RUEHGH/AMCONSUL SHANGHAI 0433
RUEATRS/TREASURY DEPT WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHGV/USMISSION GENEVA 3345
RUEHIN/AIT TAIPEI 7050

UNCLAS TOKYO 001549

SENSITIVE
SIPDIS

DEPT FOR EAP/FO, EAP/EP, EAP/J AND EAP/MTS
DEPT ALSO FOR EEB/TPP/DTC
DEPT PASS USTR FOR CUTLER, BEEMAN, WEINER
USDOC FOR 4410/ITA/MAC/OJ
TREASURY DEPT FOR IA/CARNES AND POGGI
GENEVA FOR USTR

E.O. 12958: N/A
TAGS: ETRD PREL ASEAN JA
SUBJECT: JAPAN-ASEAN FTA RATIFICATION TEMPORARILY STALLED

REF: 07 TOKYO 5402

Sensitive But Unclassified. Please Protect Accordingly.

1. (SBU) Summary: Ratification of the ASEAN-Japan
Comprehensive Economic Partnership Agreement (AJCEP) is
stalled temporarily in the Japanese Diet. The
opposition-controlled Upper House suspended deliberations on
the agreement the week of May 29 over an unrelated procedural
dispute with the ruling bloc. If the Upper House fails to
approve the measure before the current legislative session
ends June 15, the ratification process will need to begin
again when the Diet reconvenes for an extraordinary session,
perhaps at the end of August. Ministry of Economy, Trade and
Industry (METI) officials, however, are confident that, even
in the worst case scenario, the agreement will take effect as
scheduled December 1. End Summary.

2. (SBU) The more powerful House of Representatives (Lower
House) of the Japanese Diet ratified the AJCEP May 22.
Deliberations in the House of Councillors (Upper House)
Committee on Foreign Affairs and Defense, however, were
suspended the week of May 29 because of a dispute between the
ruling Liberal Democratic Party (LDP) and the opposition
Democratic Party of Japan (DPJ) over allowing cameras into a
committee hearing on the scandal involving former Vice
Minister of Defense Takemasa Moriya. Under the constitution,
a treaty bill can become law regardless of Upper House action
30 days after Lower House approval, but only if the Diet is
in session. The current Diet session is set to end June 15.
If the Upper House fails to act before then, the ratification
process would have to start over again in the Lower House in
the next extraordinary Diet session. Recent press reports
suggest this session could begin in late August or early
September.

3. (SBU) According to METI's Economic Partnership Division,
none of Japan's political parties object to the AJCEP. Both
LDP and DPJ members supported the ratification bill in the
Lower House vote. Nonetheless, since Japan had made
extraordinary efforts to get the treaty signed expeditiously
by all parties, METI is concerned the Diet's failure to act
would send a negative signal to its ASEAN trade partners.
The Ministry is making quiet efforts to spring the measure
free in the Upper House, but recognizes its ability to spur
Diet action is limited. For that reason, it welcomed a June
4 Nihon Keizai Shimbun editorial urging quick Upper House
action and expressing concern that failure to do so "would be
viewed as Japan lacking enthusiasm for economic
partnerships." Even in the worst-case scenario, however,
METI says Japan will be ready to implement the AJCEP on
schedule December 1.
SCHIEFFER

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