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Cablegate: Japanese Morning Press Highlights 06/10/08

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UNCLAS SECTION 01 OF 09 TOKYO 001574

SIPDIS

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 06/10/08


Index:

Afghan reconstruction:
1) Government has sent a survey team to Afghanistan to determine
possibility of dispatching SDF troops for reconstruction assistance
(Yomiuri)
2) Ambassador Schieffer welcomes SDF dispatch to Afghanistan
(Mainichi)

Impact of Okinawa election:
3) With reversal of power now in the Okinawa prefectural assembly,
opposition to Futenma relocation is building up steam again (Asahi)

4) Ruling parties' loss of Okinawa assembly majority will have a
strong impact on central government politics, centered around the
medical system for the elderly (Yomiuri)

5) Cabinet Office sees possibility of economy slipping into a
recession with two months now of bad indicators (Yomiuri)

Fukuda "vision" for the global environment:
6) Prime Minister Fukuda in environmental policy speech sees
possibility of 14 PERCENT reduction in greenhouse gases by 2020
(Yomiuri)
7) Gist of Prime Minister's speech outlining his environmental
"vision" (Asahi)
8) Fukuda's environmental proposals would cost 52 trillion yen,
impact heavily on family finances (Asahi)
9) Prime Minister Fukuda came out with his environmental vision in
order to take the policy lead at the upcoming G-8 summit at Lake
Toya (Mainichi)
10) Strong opposition to Fukuda environmental proposals from the
business community (Mainichi)
11) Democratic Party of Japan blasts Fukuda "vision" as lacking
substance (Nikkei)

Political agenda:
12) Fukuda says he has no inclination "for the time being" to
dissolve the Lower House for a snap election (Yomiuri)
13) DPJ head Ozawa denies that he is taking the lead in pushing for
a censure motion against the prime minister (Mainichi)

Articles:

1) Survey team off to Afghanistan

YOMIURI (Page 4) (Full)
June 10, 2008

A team of Japanese government officials left for Afghanistan on June
8 to explore the possibility of sending Self-Defense Forces troops
to Afghanistan. The team is made up of Cabinet Secretariat, Foreign
Ministry, and Defense Ministry officials.

The Maritime Self-Defense Force is currently engaged in a refueling
mission in the Indian Ocean under the Antiterrorism Special Measures
Law. This law, however, is set to run out in January next year. The
government therefore judged that it would have to consider
continuing Japan's assistance, including the possibility of SDF
troops working in Afghanistan.

The survey team is scheduled to stay in Afghanistan for about 10

TOKYO 00001574 002 OF 009


days to look into the security situation and needs for assistance in
the capital city of Kabul and other areas. The government is
considering engaging the Ground Self-Defense Force in logistical
support for the International Security Assistance Force (ISAF) and
tasking the Air Self-Defense Force with airlifting supplies. The
survey team includes GSDF and MSDF members.

However, there are also many challenges to clear before sending SDF
troops to Afghanistan. The government will need to create a new law
or revise the antiterror law in order for Japan to send SDF troops
there. However, it would not be easy to coordinate with the
opposition-controlled House of Councillors led by the Democratic
Party of Japan (Minshuto). In Afghanistan, many people have been
victimized in Taliban insurgents' terrorist attacks. Afghanistan is
not expected to recover its public security for now.

2) SDF dispatch welcome: Schieffer

MAINICHI (Page 2) (Full)
June 10, 2008

U.S. Ambassador to Japan Schieffer, meeting the press yesterday at
the U.S. Embassy in Tokyo, expressed his welcome for the fact that
the Japanese government is now exploring the possibility of
dispatching the Self-Defense Forces to Afghanistan. Schieffer said:
"Japan is welcome to step up its contribution to Afghanistan. Japan
is now in a preliminary phase to look into its options, so we'd like
to see progress."

3) Futenma to face stronger opposition

ASAHI (Page 4) (Full)
June 10, 2008

The ruling camp in Okinawa Prefecture's assembly led by the Liberal
Democratic Party and New Komeito has now lost its majority as a
result of the recent election. The government and the ruling parties
presume that the outcome of the election will have no impact on the
planned relocation of the U.S. Marine Corps' Futenma Air Station in
the prefecture's central city of Ginowan because there will be no
situation for the time being to ask for the prefectural assembly's
consent or agreement. However, Futenma relocation within the
prefecture will inevitably face stronger opposition. Gov. Hirokazu
Nakaima is likely to face difficulties over the Futenma issue.

"The ruling parties faced a setback in the Okinawa prefectural
assembly election, but we'd like to push ahead with the realignment
of U.S. forces in Japan and other important issues without making a
fuss," Prime Minister Fukuda stressed in a liaison meeting of the
government and the ruling parties yesterday. Chief Cabinet Secretary
Machimura also said in a press conference: "We need the governor's
permission for reclamation from the sea, but there are not so many
things that need the prefectural assembly's agreement."

However, one LDP lawmaker, who once served in one of the LDP's three
top executive posts, predicts a major impact, indicating that the
governor will face difficulties in managing his prefectural
administration on the whole. Some government officials are also
concerned about the potential impact. "I can't say we will not be
affected when we listen to Okinawa Prefecture's people in an
environmental impact assessment," a senior official of the Foreign
Ministry said.

TOKYO 00001574 003 OF 009

The government plans to build an alternative facility for Futenma
airfield in the prefecture's northern coastal city of Nago. In this
regard, Nakaima has asked the government to move the relocation site
offshore. Basically, however, he has accepted Futenma relocation
within the prefecture. Meanwhile, the opposition camp is poised to
square off with the governor while seeking to submit a no-confidence
motion against him. "We can't say we have only to move the
relocation site just a little bit into the sea," said Kantoku
Teruya, a House of Representatives member of the Social Democratic
Party, who chairs the SDP's Okinawa prefectural federation. The
government is paying close attention to the governor and the
prefectural assembly.

4) Ruling parties defeated in Okinawa assembly election due to
strong opposition to new health insurance system for the elderly;
Deliberations on opposition-drafted bill abolishing the system to be
continued

YOMIURI (Page 4) (Excerpts)
June 10, 2008

The ruling coalition of the Liberal Democratic Party (LDP) and New
Komeito lost its majority in Sunday's Okinawa prefectural assembly
election probably because of strong opposition to the new health
insurance system for those aged 75 and older. Taking into account
such public opinion, the ruling camp intends to continue
deliberations on an opposition-drafted bill to abolish the new
health insurance scheme for the elderly, not voting it down in the
House of Representatives. The opposition camp, meanwhile, has
stepped up its offensive, calling for an early Lower House
dissolution.

In the 48-member assembly election, the ruling parties lost five
seats to 22 from their pre-election strength of 27, while the
opposition camp gained five seats to 24. Two seats are neutral. (One
seat had been vacant.) All four candidates backed by the main
opposition Democratic Party of Japan (DPJ) were elected, while most
LDP candidates had uphill battles in the election.

In a meeting yesterday between the government and ruling coalition,
LDP Secretary General Bunmei Ibuki pointed out:

"The reasons (for our defeat) are likely the (changes in the fixed
numbers of electoral districts because of) merger of municipalities,
generational changes of candidates, and the new health insurance
system for the elderly."

The government and ruling coalition will hurriedly hammer out
concrete measures, such as reducing the burden on low-income
elderly, while pointing out problems in the opposition-drafted bill
through Diet deliberations. In a session yesterday of the House of
Councillors Audit Committee, Fukuda took a stance of keeping the
framework of the new health insurance system, saying: "I cannot
approve of the view calling for immediately abolishing the system.
It's a rash view."

However, LDP Election Strategy Council Chairman Makoto Koga
yesterday told the press at the Prime Minister's Official
Residence:

"There is an emotional argument as to whether (the new health

TOKYO 00001574 004 OF 009


insurance system was introduced) for the sake of the elderly people.
It is very difficult (to get public understanding for the system)."

There is the possibility that calls for a drastic review of the
system will gain ground in the ruling camp.

5) Cabinet Office sees possibility of economy slipping into
recession with two months of bad indicators

YOMIURI (Page 2) (Excerpt)
June 10, 2008

The Cabinet Office yesterday revised its judgment of the state of
the economy, based on four months of economic indicators, from last
month's "seesaw-like movement" to this month's "possibility that
aspects are changing." This was the first time for the forecast to
hint at the possibility that the economy was moving toward a
recession, the longest expansion period in the postwar period
(since Feb. 2002) having peaked a few months before.

6) Greenhouse gas emissions can be cut 14 PERCENT by 2020: Prime
minister announces introduction of emissions trading system in fall
on trial basis

YOMIURI (Page 1) (Excerpts)
June 10, 2008

Prime Minister Fukuda during a press conference held at the Japan
National Press Club in Uchisaiwai-cho, Tokyo, on the evening of June
9, released Japan's new guidelines for the battle against global
warming. Regarding a mid-term goal of cutting greenhouse gas
emissions by between 2020 and 2030, an issue in the spotlight, the
prime minister indicated an estimate that it would be possible to
cut carbon emissions by 14 PERCENT by 2020, compared with the 2005
level. He then revealed his plan to release a nation-specific cap,
which would serve as Japan's mid-term goal, within next year. He
also announced his intention to introduce an emissions trading
system for companies to trade carbon emissions quotas, saying, "The
government will introduce a domestic market on a trial basis this
fall."

The new guidelines could be viewed as the Fukuda Vision of a package
of his ideas on global warming measures. His aim is to lead domestic
and overseas discussions in the run-up to the G-8 to be held in
Hokkaido in July. The prime minister underscored, "Tackling a
low-carbon revolution seriously would enhance Japan's presence in
the international community and solidify the Japanese economy."

The prime minister categorically mentioned a long-term goal of
cutting emissions by 60 PERCENT to 80 PERCENT by 2050 from the
present level. Concerning a mid-term goal, he said, "We have no time
to play political games with a mid-term target." Concerning the
basis for achieving a 14 PERCENT cut by 2020, he proposed combining
sector-specific reductions with the introduction of cutting-edge
energy-conservation systems and new energy technologies.

7) Main points of prime minister's speech

ASAHI (Page 7) (Full)
June 10, 2008

The following is a gist of Prime Minister Fukuda's speech on turning

TOKYO 00001574 005 OF 009


Japan into a low-carbon society, delivered on June 9:

(Preface)

In order to realize a low-carbon society, global efforts and a
national movement are essential. The envisioned shift to a
low-carbon society must be taken as an opportunity for new economic
growth.

(Japan's long- and mid-term targets)

Japan's long-term target is to reduce CO2 by 60 PERCENT -80 PERCENT
from current levels by 2050.

The country cannot afford to spend time on setting (mid-term) goals.
The sector-by-sector approach (proposed by Japan) is a means to find
pragmatic solutions. Japan has recently announced that it is
possible to reduce emissions by 14 PERCENT -- about the same level
as the EU -- from current levels by 2020. Japan would like to
announce nation-by-nation targets at an appropriate time next year.

(Development of innovative technologies)

Japan will contribute up to 1.2 billion dollars to the establishment
of a new multilateral fund to support developing countries along
with the United States and Britain. I will propose the International
Partnership for Energy Efficiency Cooperation in the upcoming Lake
Toya Summit.

The ratio of renewable energy, such as solar power, wind, and water,
and "zero-emission energy sources," such as nuclear power, must be
raised to over 50 PERCENT . One out of two new cars to be sold must
be next-generation automobiles. In order to win the world's No. 1
position in solar-energy generation (back from Germany), increase
the volume 10-fold by 2020 and 40-fold by 2030, over 70 PERCENT of
houses to be built must be equipped with a solar-energy generation
system.

(Emission trading and tax reform)

Japan must shift to a stance active enough to propose more effective
rules on emissions trading. In the fall, the government will
implement a domestic emission trading system on a trial basis joined
by as many businesses and companies as possible.

In a fundamental tax reform meeting, planned for the fall, the
government will comprehensively review the taxation system,
including the handling of an environment tax, from the perspective
of promoting a low-carbon society, and will push ahead with the
envisioned environment tax.

(Public as central player)

The introduction of daylight saving time is under consideration by
the ruling parties. I hope for a conclusion at an early time.
Designating July 7 as Cool Earth Day, the country will carry out a
movement to turn off all lights and other events.

(Conclusion)

To deal with the situation, our lifestyle, everything from the
economy to society to community, must be changed. We must work hard

TOKYO 00001574 006 OF 009


so that future generations can look back and describe our efforts
for a low-carbon revolution with pride.

8) Realizing prime minister's proposal would cost 52 trillion yen;
Households likely to be affected

ASAHI (Page 7) (Excerpts)
June 10, 2008

Prime Minister Yasuo Fukuda's set of proposals to combat global
warming underlines the need for a "national movement," such as the
dissemination of solar power and next-generation automobiles, while
urging the industrial sector to join a domestic emissions trading
system. The proposal, which is certain to run huge costs, might make
electricity, automobiles, and home appliances cost more.

The prime minister emphasized: "A low-carbon society cannot function
without actions by the people." When the fiscal 2006 domestic CO2
emissions levels are compared with 1990 levels, the amount produced
by the industrial sector dropped by about 5 PERCENT while that of
the livelihood-connected and transport sectors combined increased by
about 28 PERCENT . Of the total, the industrial sector accounted for
40 PERCENT , the livelihood-connected sector for over 30 PERCENT ,
and transport 20 PERCENT .

The proposal calls for reducing emissions by 14 PERCENT from
current levels by 2020. The proposal lists such specific means as
making half of all new cars sold next-generation automobiles and
installing a solar-power generation system in over 70 PERCENT of
new houses with the aim of raising the introduction of solar-power
generation ten-fold. The Economy, Trade and Industry Ministry
estimates that purchasing such cutting-edge equipments would cost
approximately 52 trillion yen.

The ratio of hybrid cars sold today is less than 10 PERCENT and
that of electric cars is essentially zero. The promotion of sales of
such automobiles might require enhanced subsidies, something that
would make the use of tax revenues inevitable.

Electric transmission facilities would be a bottleneck for the rapid
dissemination of solar power. The country's solar-power generation
capability was 1.7 million kilowatt at the end of 2006. The
Federation of Electric Power Companies of Japan says that existing
electric transmission facilities can handle up to 10 million
kilowatts -- six times that volume -- and that a volume over that
level would require huge investment.

9) Fukuda Vision: Conscious of displaying leadership at G-8; Rivalry
with EU over emissions trading

MAINICHI (Page 2) (Full)
June 10, 2008

Prime Minister Yasuo Fukuda on June 9 released a set of global
warming measures, which included proposals for the introduction of a
domestic emissions trading system this fall on a trial basis and the
setting of a mid-term goal next year of cutting global warming
greenhouse gas emissions. The Fukuda Vision goes half a step farther
than his usual cautious stance. This is because the prime minister
has determined that it would be inevitable for Japan to announce its
stance on those issues in order for it to display leadership as the
host nation of the G-8, which is only a month away.

TOKYO 00001574 007 OF 009

The prime minister made this decision in view of the present
situation in which the EU is taking the lead in an international
discussion on global warming measures with the introduction of
emissions trading and the adoption of a mid-term goal of cutting
global warming greenhouse gas emissions 20 PERCENT from the level
of 1990 by 2020. One government source noted, "Japan would lose
ground in future talks, unless it tackles global warming on a common
ground."

However, regarding a mid-term goal, the prime minister argued, "We
have no time for engaging in a political propaganda-like
target-setting game." He thus tacitly criticized the approach of the
EU, which attaches importance to setting a numerical target. He is
sticking to a sector-specific approach of each industry piling up
achievable emissions, increasing feeling alarmed that Japan with
advanced energy-saving technology would find itself in a
disadvantageous situation, unless it digs its heels in the basis for
emissions cuts.

In formulating the Fukuda Vision, the prime minister adopted the
specifics in a meeting with a small number of staff members of the
Prime Minister's Office (Kantei) without prior coordination of
views, such as talks with ministers from related ministries,
including the Foreign Affairs, Economy, Trade and Industry, and
Environment Ministries. He thus tried to give the impression that
he had displayed leadership in switching the policy on global
warming measures.

The prime minister wants to stop the international trend of giving
priority to numerical targets. However, there are no prospects of
other G-8 nations riding on Japan's approach.

10) Deep-rooted opposition in business circles to emissions trading


MAINICHI (Page 2) (Full)
June 10, 2008

Business circles are strongly against the adoption of a domestic
emissions trading system, the showcase of the Fukuda Vision of
global warming measures. The Japan Business Federation (Nippon
Keidanren) was quick to dismiss the proposal, noting that since the
system is only one option among various policy means, it is
important to pursue discussion cautiously and completely.

The EU in 2005 adopted an emissions trading system, under which an
upper limit (emissions quota) of greenhouse gas emissions is imposed
on individual companies, and companies trade their balances.
Emissions trading under the Fukuda Vision is viewed as voluntary for
the time being. It thus gives moderate consideration to the
corporate side.

However, the power industry is increasingly alarmed about the
adoption of an emissions trading system, with the Federation of
Electric Power Companies of Japan announcing continued opposition to
the setting of binding emissions quotas. Cooperation from business
circles is indispensable in adopting a system. However, too much
deference could emasculate the system.

Regarding the setting of a mid-term goal, another focus of
attention, the prime minister steered clear of making a clear-cut

TOKYO 00001574 008 OF 009


comment, simply saying, "I will announce such a goal at an
appropriate time next year." He referred to a 14 PERCENT reduction
by 2020 compared with the 2005 level as a technically feasible
target. However, this is just a quotation from the Long-Term Outlook
for Energy Supply and Demand, which the Ministry of Economy, Trade
and Industry's council mapped out in March this year. He underscored
that Japan's reduction rate could be equal to the EU's goal, if the
base year is changed, citing that the EU's mid-term goal of cutting
carbon emissions by 20 PERCENT , compared with the 1990 level, can
be translated into a 14 PERCENT cut compared with the 2005 level.

However, Japan's emissions increased 7.7 PERCENT in 2005, compared
with the 1990 level, while the EU steadily decreased its emissions
in comparison with the level of the same base year. Many countries,
including EU members, are bound to oppose Japan if it insists on the
adoption of a base year favorable to it. Deputy Representative
Yurika Ayukawa of the G-8 Summit NGO Forum criticized the prime
minister: "That number is phony. It's just a different base year was
used. Developing countries will not get the message that Japan is
seriously tackling the issue."

11) DPJ criticizes Fukuda vision for lack of content

NIKKEI (Page 2) (Full)
June 10, 2008

Katsuya Okada, chair of the anti-global warming headquarters of the
main opposition Democratic Party of Japan (DPJ), released yesterday
a statement criticizing the so-called Fukuda vision that Prime
Minister Yasuo Fukuda unveiled the same day. The statement wrote
that the contents (of the prime minister's climate change
initiative) are extremely poor. Okada stated: "I cannot see at all
how he will deal with the matter at the Group of Eight summit in
Hokkaido." DPJ Upper House Policy Deliberation Committee Chairman
Tetsuro Fukuyama also said: "Setting a mid-term goal for (reducing
greenhouse gas emissions), an environment tax, and a greenhouse gas
emission trading scheme were all put off."

12) Prime Minister Fukuda: No Lower House dissolution for time
being

YOMIURI (Page 4) (Full)
June 10, 2008

In a speech yesterday at the Japan National Press Club, Prime
Minister Yasuo Fukuda revealed his intention of not dissolving the
House of Representatives for the time being and of giving priority
to resolving policy issues. He stated this on the timing for a Lower
House dissolution and snap election: "I want to choose the right
timing so that we can first come up with various policies and
implement them."

Regarding the timing for dissolving the Lower House, Fukuda said:

"Considering various circumstances, I will try not to have an
impact, especially on politics. I think there is a reason for a
rumor that I may dissolve the Lower House after the Group of Eight
summit in July."

He then added:

"I wonder what will happen if a political situation similar to the

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present one continues even after dissolving the Lower House. We must
deal with issues that should be resolved. I want to prioritize
them."

He said this about a cabinet shuffle: "That's a blank. It's a clear
blank sheet."

13) Ozawa denies taking initiative to submit censure motion against
Fukuda

MAINICHI (Page 2) (Full)
June 10, 2008

Democratic Party of Japan (Minshuto) President Ichiro Ozawa, meeting
the press yesterday in the city of Niigata, said his party's
decision to submit a censure motion against Prime Minister Fukuda in
the House of Councillors at the end of the current Diet session is
to "sum up" political issues for the present, such as the
controversial new healthcare system for the elderly, pension
record-keeping flaws, gasoline surcharges, and scandals involving
the Defense Ministry. Meanwhile, Ozawa denied taking the initiative
to submit a censure motion against the prime minister. "I didn't
tell them to do so," Ozawa said. He added, "If that's their
consensus, I told them that's good."

SCHIEFFER

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