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Cablegate: Japanese Morning Press Highlights 09/14/06

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ZNR UUUUU ZZH
P 140224Z SEP 06
FM AMEMBASSY TOKYO
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RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
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RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
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RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/COMPATWING ONE KAMI SEYA JA
RUEHNH/AMCONSUL NAHA 0605
RUEHFK/AMCONSUL FUKUOKA 8049
RUEHOK/AMCONSUL OSAKA KOBE 1395
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RUEHBJ/AMEMBASSY BEIJING 4160
RUEHUL/AMEMBASSY SEOUL 0294
RUCNDT/USMISSION USUN NEW YORK 1934

UNCLAS SECTION 01 OF 09 TOKYO 005286

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: JAPANESE MORNING PRESS HIGHLIGHTS 09/14/06


Index:
1) Top headlines

2) Editorials

3) Prime Minister's daily schedule

4) Japan, Iran to continue talks on Azadegan oil field project
beyond Sept. 15 deadline

5) Japan, China vice minister talks in late Sept. aim at clearing
the way for the new prime minister to visit China

6) Japan, South Korea to restart FTA negotiations next year, says
ROK deputy premier

7) Poll: Support rate for Shinzo Abe as choice prime ministerial
candidate has leveled off, as rates for other candidates rise

8) Coordination going on to select Hidenao Nakagawa as next LDP
secretary general

SIPDIS

9) SDP head Fukushima calls expected Abe government a
"postwar-denying cabinet"

10) New Komeito action plan will seek to constrain new premier on
visiting Yasukuni Shrine, avoid mention of use of collective
self-defense

11) Agreement between LDP, New Komeito to continue ruling coalition
not likely to refer to constitutional revision

12) Minshuto President Ozawa in interview says that amending the
Constitution will not be possible for some time

13) Abe if elected plans "second-chance" bill for next regular Diet
session that would help job searches, start-up companies

14) Internal Affairs and Communications Ministry to launch program
allowing IT-related employees to work at home

Articles:

1) TOP HEADLINES
Asahi:
Divided Japan (Part 1): Koizumi reform causes "sense of being
scattered apart"

Mainichi:
Insurance money paid to five major consumer loan firms, with causes
in more than half of deaths unknown in FY2005

Yomiuri:
Assaults on teachers at elementary schools increase 38 PERCENT in
FY2005

Nihon Keizai:
Deficits in fixed-phone services in remote areas to be covered by
users of all types of phone services

Sankei:
Ban on power line communications to be removed

TOKYO 00005286 002 OF 009

Tokyo Shimbun:
Abe willing to submit bill to promote second-chance program to
regular Diet session

Akahata:
Study of businesses created through deregulation (Part 1): Medical
and nursing services

2) EDITORIALS
Asahi:
(1)Politicians must speak of their historical views
(2)Fines for bid-rigging imposed to prevent illegalities

Mainichi:
(1)Restrictions on materials might reflect libraries' overreaction
(2)LDP presidential election: Measures for sustainable social
security should be presented

Yomiuri:
(1)Consumer loan firms: Contracts with life as security outrageous
(2)Survey in seven Asian countries: Expectations of Japan growing in
Asia

Nihon Keizai:
(1)2006 LDP presidential election: Swiftly normalize economic and
fiscal conditions by accelerating reform

Sankei:
(1)Candidates for LDP presidency must openly discuss tax hikes
(2)Restrictions on materials at libraries might lead to censorship

Tokyo Shimbun:
(1)Government tax panel's deferment of submission of interim report
tantamount dereliction of duty
(2)Special interest rates: Who will be saved?

Akahata:
(1)Society must eliminate drunk driving

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, September 13

NIHON KEIZAI (Page 2) (Full)
September 14, 2006

10:35:
Met Kanagawa Central Union of Agricultural Cooperatives Chairman
Okawa and others at Kantei.
14:20:
Held a commemorative photo shoot with supporters from his hometown.
Later, met Agriculture Minister Nakagawa and others.
18:45:
Dined with the staff for his office at the eel restaurant, Nodaiwa,
at Higashi Azabu.
20:41:
Returned to his residence.

4) Japan, Iran to continue talks on development of Azadegan oil
field even after Sept. 15 time limit


TOKYO 00005286 003 OF 009


YOMIURI (Page 1) (Full)
September 14, 2006

The prospect now seems certain that Japan and Iran will continue
talks on the development of Iran's Azadegan oil field, in which
Japan has a 75 percent stake, even after the Sept. 15 deadline.
Economy, Trade and Industry Minister Toshihiro Nikai and Iranian
Petroleum Minister Kazem Vaziri-Hamaneh during interviews with the
Yomiuri Shimbun indicated their intention to continue the
negotiations. However, amid growing international criticism of Iran
over its nuclear program issue, it appears that reaching an
agreement at an early date will be difficult.

Azadegan is one of the largest oil fields in the Middle East with
estimated reserves of 26 billion barrels. The two countries agreed
that INPEX, Japan's oil development company, would be given a 75
percent stake in the project. Azadegan is characterized as a trump
card for Japan in obtaining a stable oil supply.

INPEX is now pursuing talks with Iran's state-run company to begin
developing the Azadegan oil field. However, talks have become
protracted, following the US' call on Japan to halt its efforts due
to Iran's nuclear issue. The Iranian side warned Japan that unless
an agreement is reached by Sept. 15 as stipulated in the contract,
it would switch negotiations to China or Russia.

Petroleum Minister Vaziri-Hamaneh, now in Vienna, stated: "We want
to bring a successful end to our talks with Japan. We will continue
talking." He took a positive stance toward reaching agreement,
commenting: "The talks are going in a favorable direction. A
settlement will be reached." Nikai also said on the 13th, "We will
deal with the matter from an overall perspective in hopes of
reaching an amicable agreement."

5) Japan, China to hold vice ministerial dialogue later this month
in bid to set stage for new prime minister to travel to China;
Bilateral summit may occur next month

NIHON KEIZAI (Page 2) (Excerpts)
September 14, 2006

The Japanese and Chinese governments have begun moving to arrange
both sides' schedules for the new prime minister to visit China
after launching his administration as early as Sept. 26 after Prime
Minister Koizumi steps down. Japan aims to hold a summit with
Chinese President Hu Jintao as early as October. If Chief Cabinet
Secretary Shinzo Abe, the leading candidate for the Liberal

SIPDIS
Democratic Party (LDP) presidency, assumes the post of prime
minister, he has indicated that he will not state whether he will
visit Yasukuni Shrine. By avoiding that question for the time being,
Japan wants to resume top-level exchanges.

As part of the efforts to set the stage for the new prime minister
to visit China, the two governments will hold a comprehensive policy
dialogue of vice foreign ministers in Tokyo. Both sides are
arranging their schedules to get this dialogue to occur on Sept.
22-23 immediately after the presidential election. Senior Vice
Foreign Minister Yasuhisa Shiozaki already visited China on Sept.
9-10 and held informal talks with Chinese Communist Party officials.
He apparently exchanged views with them on a visit to China by the
new prime minister.


TOKYO 00005286 004 OF 009


Reportedly, China has been positive about the plan, and a mid-level
lawmaker close to Abe commented: "It depends on how China responds,
but chances are strong that Abe will choose China as the first
country for him to visit as prime minister."

6) FTA with South Korea: South Korean Vice Prime Minister expresses
desire to resume talks next year

NIHON KEIZAI (Page 1) (Full)
September 14, 2006

Commenting on a free trade agreement between Japan and South Korea,
Deputy Prime Minister and Finance and Economy Minister Kwon O-kyu,
who is in charge of the South Korean government's economic policy,
during an interview with the Nihon Keizai Shimbun noted, "We want to
resume talks with Japan's next administration within the next year."
Regarding his government's policy toward North Korea, he pointed
out, "The basic principle is to promote economic cooperation for the
sake of security on the Korean Peninsula." He then indicated a
stance of restarting economic assistance to that nation if it
presents a positive sign, such as returning to the six-party talks.

South Korea is now pursuing FTA talks with the US. It will also
enter into negotiations with the EU, possibly in October. It is thus
set to shortly launch industry-academic-government studies on FTA
talks with China, as Kwon put it. He also predicted that the two
countries would reach an agreement to start FTA talks during a
China-ROK summit to be held on the sidelines of the Asia-Pacific
Economic Cooperation forum meeting to be held in Vietnam in
November.

Working-level FTA talks between Japan and South Korea have been on
the backburner since Nov. 2004. Deputy Prime Minister Kwon noted,
"Since Japan and South Korea are mutually important partners in all
spheres, including trade and investment, I hope talks with the new
administration of Japan will be resumed at an early date." At the
same time, he stated, "An FTA between Japan and South Korea must be
put on a high level." He indicated his government's intention to
firmly maintain its liberalization condition that 90 percent of
agricultural products should be liberalized. Japan is reluctant to
open its market to this extent.

7) Poll on LDP presidential election: Support rate for Abe reaches
plateau

TOKYO SHIMBUN (Page 1) (Full)
September 14, 2006

The Tokyo Shimbun yesterday tallied the results of a survey of its
political monitors on the Internet. In response to the question of
who will be desirable for the president of the Liberal Democratic
Party (LDP), the poll showed that Chief Cabinet Secretary Shinzo Abe
was picked by 45.7 percent of the respondents and ranked at the top,
but his support rate slightly dropped from the level in the previous
survey. Although Abe is certain to win a victory in the Sept. 20
presidential race, his popularity seems to be reaching a plateau,
compared to the 2001 presidential race in which thanks to what was
called the "Koizumi fever," the support rate for Junichiro Koizumi
continued to soar until election day.

The survey, conducted among 500 monitors chosen by this newspaper,
was carried out Sept. 8-11 on the Internet. Of the monitors, 407 or

TOKYO 00005286 005 OF 009


81.4 percent answered the questions. The survey this time was the
fourth one of this kind.

The support rate for Abe dropped by 1.6 points from the 47.3 percent
level it was at in the previous survey. Abe's support rate has
declined in two consecutive polls after peaking at 51.5 percent in
the second survey at the end of July, when former Chief Cabinet
Secretary Yasuo Fukuda declared he would not run in the LDP race.

SIPDIS

Finance Minister Sadakazu Tanigaki came next after Abe with a
support rate of 24.3 PERCENT (24.5 percent in the previous survey)
and Foreign Minister Taro Aso was third, supported by 13.5 PERCENT
(10.3 percent in the previous survey).

But looking at supporters of the LDP, 73.0 percent of them favored
Abe, 17.1 percent picked Aso, and 6.3 percent backed Tanigaki. Abe
is certain to win an overwhelming victory.

By gender, 58.1 percent of Abe supporters were women, while 65.5
percent of supporters for Aso were men, revealing a clear gender gap
between the two candidates. In the case of Tanigaki, he was
supported almost equally by men and women.

8) Coordination underway in LDP to name Nakagawa secretary general

MAINICHI (Page 1) (Full)
September 14, 2006

Chief Cabinet Secretary Shinzo Abe, who is now viewed as certain to
become the next Liberal Democratic Party president, started
coordination yesterday to appoint Policy Research Council Chairman
Hidenao Nakagawa (62) of the Mori faction, to which Abe also
belongs, as secretary general. For the two other key party executive
posts -- Executive Council chairman and Policy Research Council
chairman -- Abe intends to select appropriate persons from factions
other than the Mori faction. As candidates for the post of chief
cabinet secretary -- a key post in the cabinet -- former Foreign
Minister Nobutaka Machimura (61) of the Mori faction and State
Minister in Charge of Financial, Economic and Fiscal Policy Kaoru
Yosano (68) have been mentioned, according to several aides to Abe.

Nakagawa has been like a guardian for Abe. Nakagawa has supported
the Koizumi reform line from the standpoint of the party since
assuming his current post in the reshuffle of the cabinet and party
officers last October. With an eye on the extraordinary Diet session
this fall and the House of Councillors election next summer, Abe
appears to have judged Nakagawa, who is well versed in party
business and has close ties to New Komeito, as appropriate for the
post.

Nakagawa has been elected from the Hiroshima No. 4 district nine
times. He served as Science and Technology Agency director general,
acting secretary general, chief cabinet secretary, and Diet Affairs
Committee chairman. In the LDP, it is conventional practice to
select the secretary general from a different faction from the one
to which the president belongs. But Abe indicated on Sept. 6 that he
would pick someone from the Mori faction for the post of secretary
general, remarking: "Given that the nature of factions itself has
greatly changed, continuing the practice is becoming meaningless."

It is also a traditional practice to appoint someone from the
president's faction for the post of chief cabinet secretary, but if

TOKYO 00005286 006 OF 009


the post of secretary general is awarded to Nakagawa, the focus of
attention will be on whether a member of the Mori faction becomes
chief cabinet secretary. For this post, besides veteran lawmakers
like Machimura and Yosano, some recommend such mid-ranking lawmakers
as former Land, Infrastructure and Transport Minister Nobuteru
Ishihara (49), a lawmaker who is close to Abe and belongs to no
faction, and Vice Foreign Minister Yasuhisa Shiozaki (55) of the
Niha-Koga faction.

9) SDP's Fukushima: Abe cabinet would be "postwar-denying cabinet"

MAINICHI (Page 5) (Full)
September 14, 2006

Social Democratic Party head Mizuho Fukushima made this critical
comment at a press conference at the Japan National Press Club
yesterday:

"An Abe government would be a postwar-denying cabinet. (In his
book), Mr. Abe rejects the postwar period's starting point of not
letting Japanese ever again have to die for their country."

Fukushima also took a cautious posture about cooperating with
Minshuto (Democratic Party of Japan) in election campaigning,
saying, "Without a policy accord, our party would be invisible to
the voters."

10) New Komeito's action policy discourages Yasukuni visits by next
prime minister, does not mention collective self-defense

YOMIURI (Page 2) (Excerpts)
September 14, 2006

The New Komeito at its executive meeting yesterday decided on the
party's draft action policy for the next two years. Criticizing the
prime minister's visits to Yasukuni Shrine in connection with
relations with China and South Korea, the policy said, "For
resolving issues, Japan has no other option but to pursue ceaseless
dialogue between top leaders," envisaging that Chief Cabinet
Secretary Shinzo Abe will become the next prime minister. The

SIPDIS
policy, however, stopped short of referring to the question of
exercising the right of collective self-defense and building a new
national war memorial - matters that may result in a conflict with
the Liberal Democratic Party. The party plans to officially adopt
the action policy at the Sept. 30 party convention.

As achievements by the coalition government with the LDP, the action
policy listed the revitalized economy, reform of political funds and
collusive ties between politics and the bureaucracy, and the
revamped social security system. The policy also listed five future
challenges: (1) educational reform; (2) new economic growth; (3)
revitalizing local economies; (4) reining in social disparity; and
(5) the declining birthrate and the rapidly graying population.

11) LDP, New Komeito draft new coalition agreement not mentioning
constitutional revision

SANKEI (Page 2) (Excerpts)
September 14, 2006

An outline of the new agreement on the coalition government of the
Liberal Democratic Party and the New Komeito, worked out behind the

TOKYO 00005286 007 OF 009


scenes by the two parties assuming an Abe cabinet, was revealed
yesterday. The two parties have reached an agreement to follow the
past coalition agreement and document only pressing priorities for
the new administration. Although Chief Cabinet Secretary Shinzo Abe
is expected to be elected the new LDP president in the Sept. 20
poll, chances are that the final coalition agreement will stop short
of mentioning constitutional revision and a review of the right of
collective self-defense - matters on which Abe placed high priority
in his policy platform.

According to the outline, the agreement will cover four policy
areas: educational reform, correcting social disparities, Asia
diplomacy, and social security. In particular, educational reform --
Abe's top priority -- is defined as a core element of the coalition
agreement.

At the same time, the agreement is likely to specify such steps as
bridging the gap between large cities and rural areas, building a
social system that allows second chances for those who have failed,
and reforming the civil service system as means to correct social
disparities.

With Lower House by-elections in October, next year's unified local
election, and the Upper House election approaching, the two parties
have begun consultations centering on policymaking officials before
seeing the results of the LDP presidential election.

12) Ozawa: Constitutional revision not possible for time being

SANKEI (Page 2) (Full)
September 14, 2006

In an interview with the Sankei Shimbun yesterday, Minshuto
(Democratic Party of Japan) President Ichiro Ozawa expressed a
positive view about amending the Constitution, including Article 9,
saying:

"The parts that need to be revised can be. . . . Lawmakers need to
educate the public, but they cannot conduct politics that the public
is uninterested in. A list of priorities must be decided upon based
on the situation at the time, but I don't think it's possible (to
revise the Constitution) for the time being."

Ozawa also said of the right of collective self-defense:

"As is stipulated in the UN Charter, Japan has the right, but the
ability to exercise it is restricted under Article 9. Japan is not
allowed to use force unless it is directly attacked. . . . If it
involves UN peacekeeping operations, then the Self-Defense Forces
can be dispatched (overseas)."

He also indicated that even if the ruling coalition were forced into
the minority in next year's Upper House election, Minshuto would not
be able to wrest power from the ruling coalition until after the
next Lower House election. Selecting a new lineup of party
executives to win elections is his top priority, according to
Ozawa.

13) Candidate Abe intends to submit "second chance promotion bill"
to ordinary Diet session as part of efforts to lead measures for
employment and starting businesses


TOKYO 00005286 008 OF 009


TOKYO SHIMBUN (Top play) (Full)
September 14, 2006

Chief Cabinet Secretary Shinzo Abe, one of the three candidates for
the Liberal Democratic Party (LDP) presidency, yesterday made up his
mind that once he is elected as president and assumes the post of
prime minister, he would submit to the next ordinary session of the
Diet a bill for promotion of second chances, aimed at helping
jobless people, freelance part-timers (freeters), the baby boomers
to find jobs or start businesses.

After establishing his administration, Abe intends to come up with
the philosophy of second chance promotion measures and basic
guidelines for them in order to put them into practice continuously.
He also intends to specify a timetable for those measures in a law
on second chance promotion, as well as to systematize relevant
specific steps to be taken.

This past March, Abe launched a second chance promotion council to
be chaired by himself. In May, the council came up with an interim
report dealing with specific measures to rectify social disparities,
such as helping jobless people to find jobs and improving treatment
toward nonregular workers. A portion of the report is likely to be
reflected in the compilation of budget for fiscal 2007.

The council is a hodgepodge of officials from various ministries and
agencies, so bureaucratic bickering over leadership could occur in
the weeks ahead. There is also concern that if each ministry or
agency stretches the meaning of the second chance promotion measures
and appropriate their own budgets for them, the result would go
against the trend of cutting expenditures.

Given those possibilities, Abe has judged it necessary to enact a
law in order to aggressively promote the measures, while placing
coordination of views with ministries and agencies under the
leadership of the Prime Minister's Official Residence.

As for a set of measures for rectifying social disparities that
requires amendment to the existing law, Abe intends to improve the
legislation. He will consider submitting a social disparity
correction bill and a second chance promotion bill as a package.

14) MIC to adopt IT-related work-at-home system for first time as
government agency; Staffers raising children eligible for using new
system

YOMIURI (Page 2) (Excerpts)
September 14, 2006

The Ministry of Internal Affairs and Communications (MIC) yesterday
revealed a plan to introduce a teleworking system starting on Sept.
15. This system is more common among private companies. Some central
government agencies and local government have introduced this system
on a trial basis. However, MIC is the first government agency that
will adopt it on a full scale. The government aims to increase the
ratio of telecommuters to 20 percent of the working population by
2010. MIC, which is in charge of promoting the system, wants to
encourage other agencies, which are lagging behind the private
sector, to adopt it, by spearheading the dissemination effort.

Telework system users will be connected to MIC's LAN system through
their personal computers at home using broadband access service, and

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perform office work, such as clerical work.

Information and messages to be exchanged will be encrypted for
safety. PCs to be used for this will be a special model business use
PC. Its main unit cannot store data, as such it is impossible for
home-based workers to save intra-ministry information and sneak it
out.

SCHIEFFER

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