Cablegate: Daily Summary of Japanese Press 08/07/06

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UNCLAS SECTION 01 OF 07 TOKYO 004431

SIPDIS

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: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

(9) Japan-ROK joint poll: No way out of anti-Japanese sentiments in
South Korea; Pro-ROK mood cools down in Japan

ARTICLES:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern

NIHON KEIZAI (Top Play) (Almost full)
August 7, 2006

The Nihon Keizai Shimbun has conducted a survey of 100 corporate
presidents and compiled the results on August 6. In the poll, 95
PERCENT of respondents replied that they saw the economy as
expanding, and 44 PERCENT of them took the view that the economy
would continue to expand for more than a year. More than 80 PERCENT
of surveyed corporate managers cited the US economy and rising crude
oil prices as matters of concern. Nearly 80 PERCENT of respondents
were proactive about corporate mergers and acquisitions (M&A), which
are increasing throughout the world.

The poll was conducted on presidents (including chairmen) of major
Japanese companies from late July through early August, and 113
replies were received. To a question on the present state of the
economy, the number of pollees who replied, "expanding," dropped
3.7points from the previous survey carried out in March. However,
more than 90 PERCENT of corporate pollees still see the economy as
robust.

Among those who replied that the economy is growing, 93.6 PERCENT
replied that the expansionary trend would continue through October
2006 and on to December or beyond. Of these, 44.8 PERCENT thought
the trend would continue into the July to September period of 2007.
If the current economic expansion continues until November this
year, marking 58th months of expansion, it wouldl top the Izanagi
boom, the longest period of prosperity and rapid economic expansion
in Japan (1965-1970). Most respondents are confident that the
current economic expansion will top the Izanagi boom and that the
trend will continue.

As future matters of concern, rising prices of natural resources,
such as crude oil, were cited by 86.5 PERCENT of respondents and
the political and economic situations in the US by 85 PERCENT
(plural replies were allowed). The number of respondents who singled
out rising crude oil prices above other factors rose 37.7 points
from the previous survey. The surge in crude oil prices is serving
as a downside risk factor to corporate performances in the
transportation and petrochemical areas. There is also a growing view
that soaring gasoline prices will have an impact on the now solid
trend of personal consumption.

As countries whose economies are posing concern about a downturn,
77.4 PERCENT cited the US, a jump of 21.5 points from the preceding
survey, largely topping Europe, cited by 6.8 PERCENT , and Japan,
cited by 4.5 PERCENT . Due to the impact of the belt-tightening
policy, which has been in place since 2004, investment in housing

TOKYO 00004431 002 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

and personal consumption are slowing in the US. Pollees are
concerned about the future of the US economy.

Amid the progress of global reorganization in such sectors as steel,
71.4 PERCENT replied that they would consider M&As in a positive
manner, if the offer were favorable. A total of 76.75 of
respondents, combining 4.5 PERCENT , who replied that they would
consider M&A proposals, if they were friendly bids, and 0.8 PERCENT
, who replied that they would consider the offer, if necessary, even
if they were hostile bids, view M&As in a positive manner.

Regarding the aim of accepting M&As, the largest number of 73.5
PERCENT replied, "in order to strengthen weak areas in the main
business line or existing businesses," followed by 69.6 PERCENT ,
who replied, "in order to put new projects or overseas projects on a
smooth track in a short period of time."

To a question on the lifting of the zero interest rate policy by the
Bank of Japan, the largest number of 61.7 PERCENT said, "There will
be no major impact." Though interest rates are expected to rise in
the future, 84.2 PERCENT of corporate managers said they would
carry out their capital investment plans for fiscal 2006 as
originally planned.

(9) Japan-ROK joint poll: No way out of anti-Japanese sentiments in
South Korea; Pro-ROK mood cools down in Japan

YOMIURI (Page 12) (Full)
August 7, 2006

Questions & Answers
(Figures shown in percentage)

Q: What's your impression of South Korea?

Japan ROK
Very good 4.9 ---
Good to a certain degree 38.6 ---
Bad to a certain degree 39.7 ---
Very bad 11.5 ---
No answer (N/A ) 5.4 ---

Q: What's you impression of Japan?

Japan ROK
Very good --- 0.2
Good to a certain degree --- 16.9
Bad to a certain degree --- 60.9
Very bad --- 21.2
N/A --- 0.8

Q: What about North Korea?

Japan ROK
Very good 0.3 1.3
Good to a certain degree 0.1 29.6
Bad to a certain degree 10.0 55.0

TOKYO 00004431 003 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

Very bad 88.2 12.8
N/A 1.4 1.3

Q: Which country or area do you think will pose a military threat to
your country? Pick one or more from among those listed below if
any.

Japan ROK
Japan --- 55.2
ROK 10.9 ---
U.S. 17.6 32.0
China 44.0 36.0
ASEAN 0.5 0.5
EU 0.5 0.2
Russia 12.7 6.0
Taiwan 0.5 0.4
North Korea 77.7 59.1
India 2.9 0.2
Middle East 7.8 2.8
Oceania 0.3 0.1
Africa 0.3 0.2
Central & South America 0.8 0.1
Other answers (O/A) 0.2 ---
Nothing in particular (NIP) 4.3 1.3
N/A 3.3 0.3

Q: Japan has sent Self-Defense Forces personnel to Iraq for
humanitarian reconstruction assistance. Would you like Japan to
continue its SDF deployment overseas for humanitarian reconstruction
assistance?

Japan ROK
Yes 23.1 5.8
Yes to a certain degree 27.2 36.3
No to a certain degree 23.6 40.5
No 22.3 15.1
N/A 3.8 2.3

Q: The United Nations Security Council is currently made up of five
countries-the United Sates, France, Britain, China, and Russia.

For Japanese respondents: Do you think Japan should join the UNSC as
a permanent member?

Japan (1995)
Yes 57.3 (47.4)
No 17.4 (25.4)
Not interested 19.3 (20.3)
N/A 6.0 (6.8)

For South Korean respondents: Do you think Japan should be seated on
the UNSC as a permanent member?

ROK (1995)
Yes 12.3 (19.1)
No 70.3 (48.4)
Not interested 15.5 (19.5)

TOKYO 00004431 004 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

N/A 1.9 (13.0)

Q: The so-called Class-A war criminals, who were held responsible
for the past war in the International Military Tribunal for the Far
East (Tokyo Trials), are also enshrined at Yasukuni Shrine, where
the war dead and others are enshrined. Is this acceptable to you?

Japan ROK
Yes 23.8 2.8
Yes to a certain degree 22.3 13.2
No to a certain degree 20.8 42.5
No 23.1 39.8
N/A 10.0 1.7

Q: Do you think it all right for a Japanese prime minister to pay
homage at Yasukuni Shrine?

Japan ROK
Yes 59.8 10.0
No 35.4 85.8
N/A 4.8 4.2

Q: Do you think Japan may become a military power in the future, or
do you otherwise think Japan is already a military power?

Japan ROK
Yes 19.0 40.9
No 71.1 37.8
Already a military power 6.4 19.9
N/A 3.5 1.4

Q (in Japan): What's your interest in Japan's relations with China
and South Korea? Pick as many as you like from among those listed
below.

Q (in South Korea): What's your interest in South Korea's relations
with Japan? Pick as many as you like from among those listed below.

Japan ROK
Resume mutual visits between top leaders
33.2 15.8
Yasukuni Shrine homage 37.9 42.8
Territorial row over Senkaku, Takeshima (Dokdo) isles
59.0 88.0
Joint study of history 17.1 32.5
Earth environment 22.4 8.2
Trade, economic exchanges 23.6 24.3
Economic, technological cooperation
16.6 22.9
Accepting workers from China, South Korea to Japan
7.9 5.3
Cultural, human exchanges 23.6 17.7
Sightseeing, shopping 10.6 15.0
O/A+NIP+N/A 8.4 0.5

Q: Do you think the relationship between Japan and South Korea is
now in good shape, or in bad shape?

TOKYO 00004431 005 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

Japan ROK
Very good 3.2 0.1
Good to a certain degree 32.8 12.0
Bad to a certain degree 48.3 73.6
Very bad 11.1 13.6
N/A 4.8 0.7

Q: Do you think South Korea (Japan) is trustworthy?

Japan ROK
Very trustworthy 4.7 0.4
Somewhat trustworthy 38.7 10.5
Not very trustworthy 37.8 59.2
Not trustworthy at all 13.4 29.4
N/A 5.4 0.5

Q: Do you think what Japanese troops did on the Korean Peninsula or
in other Asian countries during World War II still prevents Japan
and South Korea from developing their relations?

Japan ROK
Yes 74.8 75.0
No 19.6 23.5
N/A 5.6 1.5

Q: Do you think it possible to resolve the territorial row over
Takeshima (Dokdo) through intergovernmental talks between Japan and
South Korea?

Japan ROK
Yes 12.6 2.7
Yes to a certain degree 17.0 17.9
No to a certain degree 28.2 53.0
No 37.3 25.8
N/A 4.9 0.6

Q: South Korean President Roh Moo Hyun has blamed Japan for its
territorial claim to the Takeshima (Dokdo) isles and stands firm
against Japan. Do you think such an attitude assumed by the South
Korean president is appropriate?

Japan ROK
Yes 3.1 37.7
Yes to a certain degree 7.0 34.5
No to a certain degree 32.7 22.0
No 51.2 4.7
N/A 5.9 1.1

Q: Do you feel a threat from North Korea's ongoing nuclear
development? Pick only one from among those listed below.

Japan ROK
Yes, very much 55.3 13.6
Yes, somewhat 31.8 45.8
No, not very much 9.6 32.5
No, not at all 1.9 7.8

TOKYO 00004431 006 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

N/A 1.4 0.3

Q: (Only for those who answered "yes" to the foregoing question)
What do you think is needed to have North Korea give up on its
nuclear development programs?

Japan ROK
Dialogue 24.2 66.3
Pressure 56.7 20.0
Can't say which 18.0 13.5
N/A 1.1 0.2

Q: Do you think Japan and South Korea should cooperate to resolve
the issue of Japanese and South Korean nationals abducted to North
Korea?

Japan ROK
Yes 67.7 16.3
Yes to a certain degree 20.2 52.0
No to a certain degree 5.0 28.7
No 5.2 2.5
N/A 1.9 0.5

Q: Do you think the relationship between Japan and South Korea will
change for the better, or change for the worse?

Japan ROK
Very good 5.1 0.9
Good to a certain extent 32.4 19.7
Unchanged 49.3 61.2
Bad to a certain extent 8.4 16.6
Very bad 1.5 1.0
N/A 3.4 0.6

Q (in Japan): Prime Minister Koizumi's term as his ruling Liberal
Democratic Party's president will end in September this year. Do you
expect the next prime minister to improve Japan's ties with China
and South Korea?

Q (in South Korea): Prime Minister Koizumi's term as his ruling
Liberal Democratic Party's president will end in September this
year. Do you expect the next Japanese prime minister to improve
South Korea's ties with Japan?

Japan ROK
Yes, very much 39.4 2.4
Yes, somewhat 36.4 30.8
No, not very much 16.7 57.1
No, not at all 5.4 5.6
N/A 2.2 4.1

Q (in South Korea only): What's your interest in Japan? Pick as many
as you like from among those listed below if any.

Japan ROK
TV programs --- 8.5
Animations, comics --- 25.6

TOKYO 00004431 007 OF 007

SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/07/06
Part-2
INDEX:
(8) Poll on 100 corporate presidents: 44 PERCENT says economic
expansion will continue for more than a year; 76 PERCENT positive
about M&As; US economy, high crude oil prices are matters 0f
concern8

Pop music --- 5.8
Movies --- 9.7
Talent --- 3.8
Autos, motorcycles --- 21.1
Home electric appliances --- 43.5
Personal computers --- 5.9
Japanese food --- 17.2
Fashion --- 14.6
Japanese business management --- 11.5
Japanese language --- 12.5
Japanese thinking --- 19.5
TV, PC games --- 8.5
Sumo wrestling, baseball, other sports
--- 9.2
Kabuki, other traditional cultures
--- 2.4
O/A --- 0.8
NIP+N/A --- 9.7

Polling methodology

Japan: The survey was conducted July 8-9 by the Yomiuri Shimbun on
the basis of door-to-door visits for face-to-face interviews. For
the survey, a total of 3,000 persons were chosen from among the
nation's voting population at 250 locations on a stratified
two-stage random-sampling basis. Answers were obtained from 1,867
persons (62.2 PERCENT ). In the breakdown of respondents, males
accounted for 48.6 PERCENT and females 51.4 PERCENT .

ROK: The survey was conducted from June 22 through July 3 by the
Hankook Ilbo (Korea Times), a South Korean daily, and its
contractor, Millward Brown Media Research Inc., on the basis of
door-to-door visits for face-to-face interviews. For the survey,
pollees were chosen from among males and females, aged 20 and over,
at 106 locations across the nation, on a stratified multi-stage
sampling basis. Answers were obtained from a total of 1,000 persons.
In their breakdown, males accounted for 49.5 PERCENT and females
50.5 PERCENT . The previous surveys in 1995, 2002, and 2005 were
conducted in the same way as the latest survey. The survey in 1996
was conducted in five cities, including Seoul.

SCHIEFFER

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