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Cablegate: Daily Summary of Japanese Press 09/20/06

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DE RUEHKO #5399/01 2630810
ZNR UUUUU ZZH
P 200810Z SEP 06
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 6540
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/COMUSJAPAN YOKOTA AB JA//J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/COMPATWING ONE KAMI SEYA JA
RUEHNH/AMCONSUL NAHA 0677
RUEHFK/AMCONSUL FUKUOKA 8123
RUEHOK/AMCONSUL OSAKA KOBE 1477
RUEHNAG/AMCONSUL NAGOYA 7885
RUEHKSO/AMCONSUL SAPPORO 9214
RUEHBJ/AMEMBASSY BEIJING 4232
RUEHUL/AMEMBASSY SEOUL 0362
RUCNDT/USMISSION USUN NEW YORK 1993

UNCLAS SECTION 01 OF 05 TOKYO 005399

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 09/20/06


INDEX:
(1) Editorial: Yokota airspace must be returned to Japan

(2) Itokazu decides to run in Okinawa gubernatorial election; US
force realignment to be top issue in campaign

(3) Itokazu to officially declare candidacy on Sept. 23 in Okinawa
gubernatorial election in response to request from six parties, with
opposition to Futenma coastal relocation plan

(4) Revision to Money Lending Control Law reveals foreign companies
are eating into Japan's consumer financing

(5) Kagefumi Ueno named ambassador to Vatican

ARTICLES:
(1) Editorial: Yokota airspace must be returned to Japan

TOKYO SHIMBUN (Page 5) (Full)
September 20, 2006

Talks on returning air traffic control over the Yokota airspace, now
held by US forces in Japan, are now in the final stretch in
connection with a project to expand Haneda Airport and the agreement
on realignment of US forces in Japan. Japan must win back
sovereignty over its skies so that aircraft can fly more freely.

The postwar era is not totally over for Japanese skies. Flights from
Haneda Airport bound for the Kita-kyushu, Chugoku, or Hokuriku
region have to ascend sharply over Tokyo Bay to head for the west to
fly over the huge "air wall" stretching from the Izu Peninsula to
Niigata Prefecture.

Talks have repeatedly been conducted in the postwar period to
discuss returning the Yokota airspace, a step-like airspace
straddling over Tokyo and eight neighboring prefectures. Under the
airspace sit the Yokota, Atsugi, and Iruma bases. Because the
airspace is restricted to US military aircraft, any civilian plane
that wants to enter the space must obtain permission from US forces
in advance.

The ongoing talks were prompted by the project to expand Haneda
Airport to meet growing passenger demand. The number of annual
flights to and from Haneda Airport will increase from the current
296,000 to 407,000 when its fourth runway is completed at the end of
fiscal 2009.

An additional 2,500-meter runway at Narita Airport is also scheduled
to be operational in the spring of 2010, pushing up the number of
annual flights to and from the airport from the current 200,000 to
220,000.

The Land, Infrastructure and Transport Ministry conducted talks with
the US in close cooperation with the Foreign Ministry and the
Defense Agency, seeking a total return of the Yokota airspace
initially. As a result, the two countries managed to produce a US
force realignment final report specifying that: (1) air traffic
control over the Yokota airspace shall be partially returned to
Japan by September 2008; and (2) airspace subject to reversion shall
be determined by October 2006.

The two countries decided to continue discussing a total return of
the airspace, however. This forced the Transport Ministry to call

TOKYO 00005399 002 OF 005


for a deep cut in the Yokota airspace, a pragmatic response. The
civilian aviation industry is also watching attentively to what
extent the US will reduce its Yokota airspace.

Even a partial return of the airspace is expected to increase flight
safety, reducing near-miss accidents, flight times, fuel
consumption, and carbon dioxide emissions.

The challenges of reversion of airspace control involve the Yokota
base in Tokyo, the Iwakuni base in Yamaguchi, and the Kadena base in
Okinawa. Of them, airspace control at Kadena Air Base is set to be
returned to Japan by the end of fiscal 2007. Japanese air traffic
controllers are undergoing training.

The question of returning airspace is closely associates with
security. Special airspace must be dissolved. The government must
work harder to regain sovereignty over skies once and for all.

Sept. 20 falls on Air Day, which evolved from Aviation Day,
designated in 1940 in commemoration of Japan's first powered flight.
Japan's defeat in WWII disrupted the tradition. The tradition came
back to life in the new name in 1992, the 40th anniversary of
resumed civilian aviation. Let us resolve the longstanding airspace
issue so that we can celebrate the anniversary wholeheartedly.

(2) Itokazu decides to run in Okinawa gubernatorial election; US
force realignment to be top issue in campaign

OKINAWA TIMES (Page 2) (Excerpts)
September 20, 2006

(Commentary)

Six opposition parties have decided to jointly field House of
Councillors member Keiko Itokazu, 58, in the Okinawa gubernatorial
election. In a press briefing to announce her candidacy yesterday,
Itokazu stressed her opposition to constructing new facilities,
including one to relocate the US Marine Corp's Futenma Air Station
to a coastal area of Camp Schwab. In the Nov. 19 election, the
candidates backed by the ruling and opposition camps will engage in
one-on-one fight, centered on the propriety of the realignment of US
forces in Japan. Although the campaign period is extremely short,
the work to lay down basic policies for Itokazu has yet to start. In
the opposition camp, there are wide differences in views on the
Japan-United States security arrangements, the Self-Defense Force
(SDF), and national security. The opposition parties are urged to
coordinate views quickly.

Asked about why she decided to accept the request, Itokazu
emphatically said in a press conference:

"If a person who tolerates plans to build new bases in the
realignment of US forces in Japan is elected as Okinawa governor,
the prefecture's future will be in danger. ... I am opposed to all
decisions that could lead to war. I am determined to convey to the
governments of Japan and the United States Okinawan residents' views
on the base issue that will be affected by the governor's stance."

The six opposition parties share basic views, including opposition
to constructing new military bases in the process of realigning US
forces in Japan. For Itokazu, who was involved in the anti-war peace
movement and later became a politician, her position on the base
issue is a nonnegotiable political item. In order to obtain support

TOKYO 00005399 003 OF 005


from Tokunobu (?) Yamauchi, 71, who declined candidacy, and others,
she cannot allow herself to compromise in that policy stance.

Even so, if Itokazu has a strong reformist flavor, supporters of
Minshuto (Democratic Party of Japan) may step back from her.

Following Itokazu's decision to run in the election, Sozo gave up
fielding its president, Mikio Shimoji, 45, as its candidate. A party
member said: "Now that President Shimoji has dropped his candidacy,
all six parties can back Itokazu."

(3) Itokazu to officially declare candidacy on Sept. 23 in Okinawa
gubernatorial election in response to request from six parties, with
opposition to Futenma coastal relocation plan

OKINAWA Times (Page 1) (Full)
September 20, 2006

House of Councillors member Keiko Itokazu, 58, declared her
candidacy yesterday as a contender jointly backed by six opposition
parties in the Okinawa gubernatorial election set for Nov. 19. The
six parties are the Social Democratic Party; Okinawa Shakai Taishuto
(Okinawa Social Mass Party); the Japanese Communist Party; Minshuto
(Democratic Party of Japan); the Liberal League; and Sozo
(Imagination). Itokazu, also deputy chief of Okinawa Shakai Taishuto
(Okinawa Social Mass Party), said: "I really feel the responsibility
of my role, and it is having a bracing effect on me. I would like to
stride toward victory and regain the helm of the prefectural
administration from the ruling camp." She expects to officially
announce her candidacy on Sept. 23.

With the slogan of "pursuing a peaceful prefectural administration,"
Itokazu takes the stance of opposing the controversial plan to
relocate the US Marine Corp's Futenma Air Station to a coastal area
of Camp Schwab. This plan is included in the final report on the
realignment of US forces in Japan. She will try to win support from
the prefecture's residents by setting forth the debate over the
coastal plan as the central issue in the campaign.

Upon expressing her opposition to the coastal plan, Itokazu said:
"If a person who tolerates the plan is elected as Okinawa governor,
the future of Okinawa will be exposed to risk. In order to defend
our lives and livelihood, I would like to convey Okinawan residents'
feelings to both the Japanese and United States governments."

Asked why she decided to run in the election while in office as a
member of the House of Councillors, Itokazu replied: "Looking back
over the past elections, it is apparent that unless we band
together, it will be impossible to win a victory. Receiving the
request from the six opposition parties to field a unified
candidate, I felt a great sense of mission." She added: "I expect
that arrangements will be made for the parties to take joint steps
and make utmost efforts."

After the political party Sozo, headed by Mikio Shimoji, decided to
support Itokazu, its representative said: "It is necessary to
explain in the general meeting planned for Sept. 22 about why our
party also support the candidate fielded jointly by other five
parties." But he added: "Ms. Itokazu has not presented her policy
stance. It is necessary to take time to look into how we should
support her."

Prior to presenting the request to Itokazu, the six opposition

TOKYO 00005399 004 OF 005


parties confirmed that they would remain unwavering in their basic
stance, including opposition to the Camp Schwab coastal plan. A
decision was made for Okinawa Shakai Taishuto to take charge of
making arrangements for joint struggle. The chairman of the
supporters' group for Itokazu said: "Since this is a quick campaign,
each day is important. We would like to form a united front to
regain the helm of the prefectural political power."

(4) Revision to Money Lending Control Law reveals foreign companies
are eating into Japan's consumer financing

SHUKAN SHINCHO (Page 38)
September 28, 2006

The issue of revising the Money Lending Control Law has drawn public
attention in various ways due in part to lawmaker Masazumi Gotoda's
resignation as Cabinet Office parliamentary secretary. After much
furor, the Liberal Democratic Party (LDP) has decided to lower the
special-exception interest rate from 28 PERCENT to 25.5 PERCENT
and cut short a period in which interest rates topping the level are
allowed under the Interest Rate Limit Law from the original nine
years to five years. A political news section reporter of this
weekly magazine noted: "With an eye on the Lower House by-elections
in October and next year's Upper House election, Policy Research
Council Chairman Hidenao Nakagawa managed to reach a settlement.
However, the high interest rate will remain in place for five years.
The settlement was like a cross between intra-party arguments for
and against the existence of interest rates topping the level
allowed under the law."

Will this legislation really settle the multiple debts issue? The
venue of deliberations on thorny issues, such as the link between
suicides of borrowers insured by lenders and the cause of such
suicides, will shift to the extraordinary Diet session.

The extended furor has revealed clearly the existence of pressure
from foreign companies.

A financial journalist said: "Several organizations representing US
financial institutions have applied pressure on the Financial
Services Agency (FSA). For instance, the Financial Services Forum
(FSF) formed by 20 US leading financial institutions sent a letter
to FSA Director General Kaoru Yosano, urging him not to place a cap
on interest rates, as it will lead to the proliferation of loan
sharks. The letter also noted that they also sent copies to a US
under secretary and assistant secretary at the Treasury Department.

They did this because US companies now have become a formidable
presence in Japan's consumer financing market. The same journalist
added:

"Of the seven leading consumer financing companies in Japan,
Citigroup-affiliated CFJ ranks fifth, followed by GE Capital. These
two companies are members of the FSF. Unlike the saturated credit
industry, consumer financing is a lucrative business area for them.
Furthermore, some foreign companies have stake in Japanese consumer
financing companies, even though they are not directly engaging in
this business. As such, the issue this time was somebody else's
affair for them."

It is not unusual to see blue-eyed loan sharks in Japan these days.

(5) Kagefumi Ueno named ambassador to Vatican

TOKYO 00005399 005 OF 005

SANKEI (Page 2) (Full)
September 13, 2006

The government decided at a cabinet meeting on Sept. 12 to appoint
Kagefumi Ueno, a managing director of the Japan International
Training Cooperation Organization (JITCO), to serve as ambassador to
Vatican, and other ambassadors. The appointments were formally
announced the same day.

Shinichi Kitaoka, who was appointed as deputy permanent
representative of Japan to the United Nations in April 2004, is to
return to the University of Tokyo as of Sept. 13.

Ambassador to Vatican Kagefumi Ueno: Graduated from the University
of Tokyo; entered the Ministry of Foreign Affairs (MOFA) in 1972;
served as managing director of the JITC since February 2004, after
having served as ambassador to Guatemala; age 58; born in Tokyo.

Ambassador to Tanzania Makoto Ito: Graduated from Nagoya University;
entered MOFA in 1972; served as consul general at Detroit since
March 2003, after serving as director general of the External
Affairs (the name of which was changed to protocol chief in August
2003) of the Metropolitan government; age 57; born in Aichi
Prefecture.

Ambassador to Jamaica and to Bahamas and Belize Masahiro Obata:
Graduated from Chuo University; entered MOFA in 1968; served as
consul general at Kota Kinabalu since March 2004, after serving
deputy chief of protocol; age 60; born in Niigata Prefecture.

SCHIEFFER

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