Cablegate: Daily Summary of Japanese Press 10/06/06

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UNCLAS SECTION 01 OF 05 TOKYO 005831

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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 10/06/06

INDEX:

(1) Anti-terror Law: Government makes decision to extend it for the
third time and continue MSDF's maritime supplying activities

(2) Whether government's intelligence function is strengthened
depends on prime minister's "determination"

(3) FTA: Rising mood for resuming talks with South Korea, possibly
before year's end following summit meeting

(4) Restart of Japan's relations with China and with South Korea
(Part 2): Urgent need for resolving pending issues

ARTICLES:

(1) Anti-terror Law: Government makes decision to extend it for the
third time and continue MSDF's maritime supplying activities

MAINICHI (Page 1) (Excerpt)
Eve., October 6, 2006

The government this morning held a cabinet meeting to approve an
amendment to the Anti-Terror Special Measures Law allowing a
one-year extension. This would be the third extension of the law
since it was passed, and it will allow the Maritime Self-Defense
Force to continue its supplying activities in the Indian Ocean that
it started in 2001. The MSDF will enter a sixth year of providing
such services. The government and ruling parties plan to have the
Diet pass the bill quickly, but the opposition camp, including the
Democratic Party of Japan (Minshuto) remains opposed.

(2) Whether government's intelligence function is strengthened
depends on prime minister's "determination"

SANKEI (Page 5) (Full)
October 5, 2006

The Abe administration needs to strengthen the government's
intelligence function. Before it stands a mountain of challenges,
such as strengthening the intelligence-gathering system for the
Prime Minister's Official Residence (Kantei), creating a foreign
intelligence agency, and establishing a legal system to protect
intelligence. Such systems have already been completely set up in
the United States, Europe, South Korea, and other democratic
countries. To what extent Japan will be able to introduce these
functions hinges on Prime Minister Shinzo Abe's "determination."

"If Japan had prepared a satisfactory intelligence function in the
postwar period, a large number of Japanese nationals would never
have been abducted," said Chief Researcher Katsuhisa Furukawa of the
Research Institute of Science and Technology for Society.

The National Police Agency and the Public Security Intelligence
Agency are engaged in gathering intelligence pertaining to domestic
security. When it comes to overseas intelligence, however, the
government's analysis system is quite poor. The Cabinet Information
Research Office was set up in September 1952 under the lead of
Taketora Ogata, who was chief editor and a close aide to Prime
Minister Shigeru Yoshida. Although more than 50 years have passed
since then, the Cabinet Intelligence and Research Office (CIRO), its
successor, is still understaffed. Although CIRO is regarded as the
Japanese counterpart of the CIA (US Central Intelligence Agency) and

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the MI 16 (Military Intelligence, section 6) of Britain, the office
has yet to be labeled as a full-fledged operation.

Under such a situation, as a senior Liberal Democratic Party
official said, "Since Japan was hardly able to obtain intelligence
on its own on whether Iraq had weapons of mass destruction," it had
no choice but to trust the US" on the occasion of war initiated
against Iraq. When Japanese nationals were taken hostage by
terrorists in Iraq, Japan remained unable to collect information or
to take measures in an effective way. Naturally, Japan has no way of
knowing what policy China and North Korea are mapping out toward
Japan.

There are two types of foreign intelligence: confidential and open
intelligence. Confidential intelligence includes: (1) imagery
intelligence taken by spy satellites or aircraft; (2) signal
intelligence obtained by intercepting radio or other transmissions;
and (3) intelligence received from humans. In the case of Japan, the
Defense Agency has collected intelligence through three
information-gathering satellites, but what is lacking most is human
intelligence.

Japan has yet to establish a satisfactory system to accurately
analyze the intelligence collected by the Foreign Ministry, CIRO,
the Defense Agency, and the National Police Agency and to provide
such information to the nerve center of the government, including
the prime minister and the chief cabinet secretary in the form of
data or briefings.

The Cabinet Information Conference holds a meeting only twice or so
a year. The deputy chief cabinet secretaries preside over a joint
information conference with bureau director-level government
officials twice a month. Even in such meetings, government agencies
try to sequester their most valuable information and provide it
directly to the prime minister or the chief cabinet secretary in an
attempt to score points. This is a typical evil effect of the
factious bureaucracy. The prime minister and the chief cabinet
secretary are also not eager to ask for necessary information for

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policymaking.

National Institute of Informatics Professor Hajime (or Gen?) Kitaoka
said: "The Kantei should have staff specialized in assessing and
analyzing intelligence, like Britain, and be given authority to
access to important information kept by other government agencies.
It is necessary to scrap the vertically organized system of
administration." Kitaoka served as General Management Division
director in the Foreign Ministry's Intelligence and Analysis Bureau
and later General Administrative Division director in the Cabinet
Satellite Information Center.

It is said that it would take at least 10 years to prepare even
primary equipment for a foreign intelligence agency. Based on the
view that personnel are the key to this task, former CIRO head
Yoshio Omori said: "It is necessary to foster personnel and also to
establish a school to train them."

(3) FTA: Rising mood for resuming talks with South Korea, possibly
before year's end following summit meeting

NIHON KEIZAI (Page 2) (Slightly abridged)
October 6, 2006

A mood for resuming the suspended talks to sign a free trade

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agreement (FTA) with South Korea is rising prior to Prime Minister
Shinzo Abe's visits to China and South Korea. A plan has emerged to
include a statement of both countries' intention to accelerate FTA
talks in an agreement to be reached at the upcoming bilateral summit
meeting on the 9th. Some observers see talks resuming late this
year, at the earliest, once coordination of views of concerned
government agencies gets underway.

A senior Japanese Foreign Ministry official involved in FTA talks
with South Korea yesterday indicated he was pinning hopes on a
political decision by President Roh Moo Hyun, noting, "I hope the
Korean side will return to the negotiating table at the upcoming
summit meeting."

Prime Minister Junichiro Koizumi and President Roh Moo Hyun agreed
to aim at reaching a general agreement before the end of 2005 when
the met in October 2003.

Though both countries started talks in December 2003, no
working-level meeting has been held since November 2004. South
Korea, which imports a great deal of mined and manufactured products
from Japan, wants to correct the trade imbalance between the two
countries by reducing deficits with Japan through aggressive exports
of agricultural products. It is urging Japan to further open its
markets, making it a condition for Japan to liberalize 90% of its
agricultural sector. Japan is reluctant to meet this request,
arguing that such conditions for resuming talks should not be set.
It continues to remain at odds with South Korea over liberalizing
the agricultural area.

Some, however, take the view that the real reason for suspending the
talks was the political factor of strained bilateral relations due
to Prime Minister Koizumi's visits to Yasukuni Shrine, according to
one informed source connected to Japan-South Korea relations. Deputy
Prime Minister and Minister of Finance and Economy Kwon O-kyu, who
is in charge of South Korea's economic policy, during a recent
interview with the Nihon Keizai Shimbun said, "Given the size of
trade and investment between Japan and South Korea, I would like to
resume FTA talks with Japan before the end of the year."

South Korea is currently promoting FTA talks with the US. It is also
expected to enter into FTA talks with the European Union (EU) in the
near future. It plans to launch industry-academic-government studies
with China with the aim of launching FTA talks.

Japan is the ROK's largest investment partner, following the US, and
the third largest trade partner, following China and the US. Some
Japanese observers think that South Korea may have reached a
judgment that it would be advantageous to resume the FTA talks with
Japan at an early date, as a senior official of the Foreign Ministry
put it. Quiet coordination of views is proceeding ahead of the
upcoming bilateral summit meeting.

(4) Restart of Japan's relations with China and with South Korea
(Part 2): Urgent need for resolving pending issues

YOMIURI (Page 1) (Full)
October 6, 2006

It is unprecedented for a Japanese prime minister to set an
extremely tight schedule for his first overseas trip.

Prime Minister Shinzo Abe will arrive in Beijing at around noon

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tomorrow. On the afternoon, he will attend a welcoming ceremony at a
square in front of the Great Hall of the People and meet with
separately President Hu Jintao, Prime Minister Wen Jiabao, and
Standing Committee of the National People's Congress Chairman Wu
Bangguo. He is then expected to attend a dinner party hosted by
President Hu.

Staying overnight there, Abe will leave for Seoul next morning. He
will meet in the afternoon with President Roh Moo Hyun. He will then
hold a press conference. After attending a dinner party hosted by
Roh, Abe will hurryingly return home that night.

Abe's tight diplomatic schedule demonstrates that the main purpose
of his trips to Beijing and Seoul is to resume summit diplomacy with
the top leaders of China and South Korea. The summits were suspended
during the Koizumi government. Abe regards his meetings with Hu and
Roh as a political and diplomatic message. He does not necessarily
place weight on reaching agreements with them.

If Abe can gain a foothold for rebuilding Japan's relations with
China and South Korea, it can be said that his visits to Beijing and
Seoul are successful. He, however, should not be happy with "mere"
summitry. Abe's major challenge is to break away from the kind of
relationships with China and South Korea in which much energy is
spent on the issue of prime ministerial visits to Yasukuni Shrine.

There remain many pending issues between Japan and China and between
Japan and South Korea. The tug-of-war between Tokyo and Beijing and
between Tokyo and Seoul has intensified over such aspects of their
respective national interests as territorial claims and marine
resources.

A touch-and-go situation has continued between Japan and China over
exploration of undersea gas reserves in the East China Sea because
China is now ready to produce gas from the Shirakaba (Chunxiao in
Chinese) field located near the median line between Japan and China,
and Japan meanwhile has started preparations for test drilling in an
area closer to the Japanese territorial waters than to the medial
line between the two countries. There are no prospects to terminate
the vicious cycle that a confrontation between Tokyo and Seoul
intensifies every time there is an ocean current survey near the
disputed Takeshima/Dokdo islets, located in waters where the
exclusive economic zones claimed by Japan and South Korea overlap.

The Chinese government has toughened its control over Japanese
products, announcing that it has discovered harmful substances in
frozen mackerel pikes, soybean paste, soybean oil and cosmetics
imported from Japan. The dominant view in Japan is that this is
China's retaliation against Japan, which has tightened its
regulations on residual pesticides that have resulted in Chinese
products exported to Japan drastically declining. It is also urgent
to deal with cross-border environmental problems, including yellow
sand (loess) being carried in the currents from China, which
allegedly causes damage to human health. Some have noted that
Japan's diplomacy toward China and South Korea tends to swing
between being resentful toward China and South Korea or being
apologetic toward those countries. It is crystal clear that such
extremes in diplomacy cannot resolve issues.

Whether the Abe administration will be able to pave the way for a
new diplomacy toward China and South Korea is unclear, as it seeks
to break away from the postwar regime and mover toward a more active
stance.

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