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Cablegate: Japanese Morning Press Highlights 12/10/07

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UNCLAS SECTION 01 OF 10 TOKYO 005537

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 12/10/07


Index:

Host-nation support agreement:
1) Agreement between U.S., Japanese governments on Japan's
host-nation support essentially freezes the previous levels (Nikkei)

2) Agreement to extend Japan's "sympathy budget" three years, with
only minor cuts, reflects consideration for the MSDF withdrawal from
the Indian Ocean (Asahi)
3) Consideration to the U.S. went into Japan's decision on the
host-nation support budget, but the agreement also reflects great
systemic progress in the alliance (Yomiuri)
4) Impact on Japanese employees at U.S. bases of the host-nation
support agreement yet to be assessed (Yomiuri)

Okinawa base issues:
5) 10 billion yen freed up for Okinawa development projects linked
to Futenma relocation (Sankei)
6) Central government, Okinawa prefecture agree to smoothly carry
out environmental assessment at the site for the Futenma replacement
runway (Yomiuri) 7

Defense scandals:
7) Former Naha DFAB chief being questioned in connection with the
Okinawa aspects of the Moriya bribery scandal (Tokyo Shimbun)
8) MSDF lieutenant commander to be arrested today for leakage of
Aegis secrets, the first application of the U.S.-Japan secrecy
protection accord (Mainichi)

Diet agenda:
9) Bill to allow MSDF refueling mission likely to be passed by
override early in the New Year (Tokyo Shimbun)
10) Socialists threaten censure motion against prime minister if
refueling bill passed by an override vote (Mainichi)
11) After Lower House adopts extension of Diet session to Jan. 15,
ruling camp to call for talks on the social insurance mess (Sankei)

12) Perception that government reneged on promise to settle the
pension problem has created another major headache for the ruling
camp in the Diet (Mainichi)

13) Japan supports U.S. in COP13 on not having reduction targets for
reduction of greenhouse gas emissions (Mainichi)

Articles:

1) In agreement on host-nation support, Japan and U.S. essentially
maintain previous levels

NIKKEI (Page 2) (Full)
December 13, 2007

Japan and the United States reached an agreement yesterday in
negotiations on a revision to the current Special Measures Agreement
on Japan's host nation support (the so-called sympathy budget),
which is due to expire at the end of March. Under the new agreement,
the amount allocated for utility charges will be at the same level
as this fiscal year in fiscal 2008 but will be cut by 400 million
yen in both fiscal 2009 and 2010. Looking at the total amount of
approximately 140.9 billion yen (in the fiscal 2007 budget), it can
be taken that both sides, giving consideration to the importance of
the Japan-U.S. alliance, agreed to maintain almost the same as the

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previous levels in effect.

After meeting with U.S. Ambassador to Japan Thomas Schieffer at the
Foreign Ministry yesterday evening, Foreign Minister Masahiko
Koumura said: "We've reached a satisfactory conclusion. The other
side had said that Japan should increase the budget. We were able to
produce an acceptable result."

The sympathy budget includes two portions -- one based on the
Japan-U.S. Status of Forces Agreement (approximately 76.5 billion
yen in fiscal 2007) that covers maintenance costs for US military
facilities in Japan and other expenses, and another based on the
Special Measures Agreement (approximately 140.9 billion yen) that
covers utility charges and labor costs of Japanese employees working
at U.S. bases.

Japan initially aimed to significantly cut the part of its host
nation support under a renewed special agreement, given its severe
financial conditions. But the U.S. fiercely reacted to Japan's
proposal.

On utility charges, Japan will pay 25.3 billion yen in fiscal 2008,
the same as the fiscal 2007 allocation, and 24.9 billion yen in
fiscal 2009 and 2010 each, 400 million yen less than this fiscal
year under the new agreement. Japan accepted these figures in the
end, out of consideration to the U.S.

To minimize Japan's burden as much as possible, the calculation
method for payment was changed. Japan will replace the cap on annual
usage - as unit prices had risen with the spike in fuel costs - with
a cap in payments.

Fearing a negative impact of the standoff in negotiations on the
sympathy budget on the Japan-U.S. alliance, Japan began to aim to
reach an agreement even if its requests were not accepted 100
PERCENT , as said by a senior Defense Ministry official.

Prime Minister Yasuo Fukuda, Ambassador Schieffer, and former
Ambassador Baker met at a Japanese restaurant in Tokyo on the night
of Dec. 4. A source familiar with the Japan-U.S. talks said: "The
aim of the meeting was to strike a deal between Japan and the U.S.
on Japan's sympathy budget."

2) Japan, US agree on 800 million yen cut in Japan's host-nation
support for U.S. military forces over three-year period

ASAHI (Page 4) (Full)
December 13, 2007

The governments of Japan and the United States agreed yesterday on a
cut of 800 million yen in part of Japan's host-nation financial
support for U.S. military forces stationed in Japan (the so-called
sympathy budget) over a three-year period starting in fiscal 2008.
The current Special Measures Agreement on Japan's host-nation
support is due to expire at the end of March. The special agreement
portion will be reduced for the first time in seven years since
2000. Japan aimed at a drastic cut annually in the special agreement
portion, which had grown to of 140 billion yen, but the US opposed
it, citing such reasons as increasing military expenses in Iraq. As
a result, both sides agreed on only minor cuts.

Foreign Minister Koumura and U.S. Ambassador to Japan Thomas

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Schieffer met at the Foreign Ministry yesterday and agreed to extend
the special agreement for another three years. After the meeting,
Koumura told reporters: "The U.S. was even telling Japan at one
point to increase the sympathy budget, so this is a somewhat
satisfactory agreement."

Asked about whether the suspension of the Maritime Self-Defense
Force's (MSDF) refueling mission in the Indian Ocean affected the
negotiations, Koumura said: "That (the MSDF withdrawal) might have
been behind the U.S. side's strong assertion (that the current state
must be maintained). It is undesirable to see the current very
favorable Japan-U.S. relations deteriorate."

In the new agreement, the amount allocated to utility costs will be
25 billion yen in fiscal 2008 - the same as this fiscal year - but
will be reduced by 400 million yen in fiscal 2009 and 2010 each. The
Japanese government has so far covered the utility charges by
capping the annual usage but will use value instead of usage under
the new agreement so that Japan will be able to cope with oil price
rises.

A senior Foreign Ministry official said: "There will be the effect
of a 5 PERCENT budgetary cut, compared with the amount set in the
rough-estimate budget request for fiscal 2008." The agreement also
stipulated that the U.S. will make further efforts to economize on
these expenditures. Japan was calling for a bold reform of the
sympathy budget, reflecting Japan's increased financial burden
related to U.S. force realignment, such as expenses for transferring
Marines stationed in Okinawa to Guam. On this request, both sides
agreed to make a comprehensive review.

On other portions than the special measures agreement, negotiations
are going on between the parties concerned over cuts in maintenance
costs for offered facilities (45.7 billion yen in fiscal 2007) and
allowances for Japanese workers at U.S. military bases (about 10
billion yen in fiscal 2007).

3) Sympathy budget: Settlement reached with only slight cut based on
consideration given to U.S.; Major progress in terms of cost-sharing
system

YOMIURI (Page 2) (Full)
December 13, 2007

Special agreement talks to discuss Japan's share in the shouldering
of the expenses for the U.S. forces stationed in Japan (host-nation
support outlays) reached an agreement on a slight cut in its share
of the utilities costs. However, the result shows that Japan took a
noticeable stand of willingness to compromise, since it originally
aimed at paving the way for ending the shouldering of water,
lighting and heating expenses.

Meeting the press after talks with Foreign Minister Koumora, U.S.
Ambassador to Japan Schieffer noted, "The agreement this time was
extremely beneficial from the viewpoint of maintaining the
U.S.-Japan alliance." However, one senior Defense Ministry official
revealed, "There were exchanges of views that were close to a
shouting match" in the process of the talks reaching a settlement.

The so-called "sympathy budget" combines portions outlaid under the
special supplemental accord to the Japan-U.S. Status-of-Forces
Agreement (SOFA) and those paid under the SOFA itself. The budget

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totals 217.3 billion yen (for fiscal 2007). Japan's share is 74.5
PERCENT (in 2002), which is outstanding, compared with other
countries that host U.S. forces. That of South Korea is 40 PERCENT .
Germany shoulders 32.6 PERCENT . Regarding utility expenses, in
particular, some Liberal Democratic Party (LDP) members belonging to
the defense affairs policy clique in the Diet have been calling for
a cut, with one noting, "The U.S. side lacks cost awareness."

For this reason, the Japanese government made a "bullish proposal"
for cutting Japan's share in the utility expenses, which came to
25.3 billion yen in fiscal 2007, by 5 billion yen a year over five
years to make the amount zero in the end.

The talks were rough-going, with the U.S. strongly calling on Japan
to increase its share, citing as reasons its shouldering of war
costs stemming from dispatches of an increased number of personnel
to Iraq and the need to respond to the arms buildup by China. In the
end, the U.S. side accepted Japan's assertion that it would be
impossible to obtain public understanding without a reduction, even
if only slightly.

The result was dissatisfactory for the Japanese side in terms of the
sum of the money, but major progress has been made in terms of the
system.

The usual method of setting Japan's share in utility costs was to
set the ceiling for heating, gas and water supplies first. Then the
Japanese government shoulders an amount within the set ceiling.
However, both countries have now adopted a system of setting a total
amount of utility expenses to be shouldered by Japan, replacing the
conventional system.

A certain senior Defense Ministry official explained, "The U.S. will
cover the portion exceeded the ceiling. This would be effective in
the sense of having the U.S. side realize cost awareness." It would
also be possible to avoid the effect of a sharp rise in electricity
expenses due to high oil prices. As such, the same senior Defense
Ministry official said, "The effect of cost reduction would be
larger than the 1.5 PERCENT cut in the budget."

4) "Sympathy budget" to be reduced, affecting Japanese employees;
Cuts in allowances in focus

YOMIURI (Page 4) (Excerpts)
December 13, 2007

Tokyo and Washington reached yesterday an agreement in principle to
reduce Japan's host nation support (commonly called the "sympathy
budget") for U.S. forces in Japan. But in order to slash the overall
budget, the government still needs to have tough talks with Japanese
employees working at U.S. bases in the country. Japanese employees
are reacting strongly to the planned budgetary cuts that would take
a toll on them. The All Japan Garrison Forces Labor Union (Zenchuro)
plans to stage its third strike on Dec. 17.

The salaries and allowances of Japanese employees working at U.S.
bases are paid by the Japanese government in accordance with the
Japan-U.S. Status of Forces Agreement.

The government is planning to abolish what is called the
differential and language allowances that are paid in consideration
of unique circumstances at U.S. bases, such as language and custom.

TOKYO 00005537 005 OF 010


At present, 10 PERCENT is added to base pay. Approximately 10
billion yen has been included in the HNS annually.

In the talks with Zenchuro that started in October, the government
presented this view: "With Japanese people working at foreign firms
in growing numbers today, the difference in language and custom at
U.S. bases is no longer so unique." This is the reason to abolish
the outdated system, according to the government.

There is a tacit understanding in the government, however, that
there lies a bigger reason beneath it. A senior Foreign Ministry
official admitted that behind it, there is consideration for
Japan-U.S. relations, saying, "It is a good plan that does not
directly put a financial burden on the United States and does not
have adverse effects on the Japan-U.S. relations."

5) Government to implement 10 billion-yen economic package in
connection with Futenma relocation plan

SANKEI (Page 2) (Excerpts)
December 13, 2007

The Futenma relocation consultative council composed of the
government, Okinawa, and affected municipalities met yesterday at
the Prime Minister's Official Residence (Kantei). In the session,
the government announced its plan to implement shortly its 10
billion-yen economic package for Okinawa's northern area in fiscal
2007, which has been frozen, and to include about the same amount in
its fiscal 2008 budget. An agreement was reached in principle to
start an environmental impact assessment in areas around Camp
Schwab, the relocation site, as early as January. Although the
dialogue between the government and Okinawa has resumed, there was
no progress on the planned relocation itself.

Tokyo and Washington adopted in May 2006 a plan to build a V-shaped
pair of runways (on Camp Schwab). Okinawa repeatedly urged the
government to move the envisaged runways further offshore, citing
possible noise pollution affecting nearby residents. The government
flatly rejected Okinawa's request by citing the bilateral agreement,
and the consultative council has not met since January this year.
The Fukuda administration, launched in late September, has gradually
softened its stance, however.

Prime Minister Yasuo Fukuda held his first meeting with Okinawa
Governor Hirokazu Nakaima on Oct. 31. Fukuda told the press: "I
would like to push ahead with talks while incorporating Okinawa's
thinking as much as possible." Talks at the consultative council
resumed for the first time in 10 months on Nov. 7 under the
presidency of the chief cabinet secretary instead of the defense
minister and the Okinawa affairs minister, demonstrating the
Kantei-led leadership in addressing the Futenma relocation issue.

Many observers ascribe the government's softened stance to the
resignation of Vice Defense Minister Takemasa Moriya, who had played
a central role in producing an agreement between Japan and the
United States. A government official noted: "Mr. Moriya refused to
budge even an inch regarding the plan he had put together. His
posture hardened Okinawa's stance."

After the meeting yesterday, Governor Nakaima said to the press:
"(The government) begins to show an attitude of listening closely to
Okinawa's views." The government, however, reiterated its position

TOKYO 00005537 006 OF 010


of not making any changes to the plan unless there is a rational
reason. A senior government official said: "Moving (the runways) by
dozens of meters would be within the margin of error, but Okinawa is
trying to extend the distance of the relocation by breaking it up
into a number of times. The U.S. government would not agree to such
an approach." Chief Cabinet Secretary Machimura said in a press
conference yesterday: "The Japan-US agreement is paramount."

6) Futenma relocation council meets: Government, Okinawa reach
agreement to make efforts for smooth environmental assessment

YOMIURI (Page 4) (Full)
December 13, 2007

The Futenma Relocation Consultative Council, a body to discuss the
planned relocation of the U.S. Marine Corps' Futenma Air Station
among the government, Okinawa and affected municipalize, held its
fifth meeting yesterday at the Prime Minister's Official Residence
(Kantei). The government and Okinawa reached an agreement to make
efforts for the smooth implementation of an environmental impact
assessment that will start as early as next January around Camp
Schwab, the relocation site, pushing the matter a step forward. The
government announced that it will implement its fiscal 2007 economic
package (approximately 10 billion yen annually) to the northern area
and include about the same amount in its budget for fiscal 2008.

Governor Hirokazu Nakaima and Nago Mayor Yoshikazu Shimabukuro
reiterated their request to move the government's plan to build a
V-shaped pair of runways as far offshore as possible. In response,
Defense Minister Ishiba said: "Changes cannot be made unless there
is a rational reason." The two sides remain wide apart.

7) Ex-DFAA local chief quizzed over USFJ realignment projects

TOKYO SHIMBUN (Page 1) (Abridged)
December 13, 2007

A task force of the Tokyo District Public Prosecutors Office
yesterday questioned a 61-year-old retiree from the now-defunct
Defense Facilities Administration Agency (DFAA), who was a director
general of the DFAA's Naha bureau in Okinawa Prefecture (currently
the Okinawa Defense Bureau), sources revealed. The former director
general of the DFAA's Naha bureau is said to be a confidant of
former Administrative Vice Defense Minister Takemasa Moriya, 63, who
has been arrested on bribery charges. The former director general
was one of those in charge of realigning the presence of U.S. forces
in Japan. The task force searched the Defense Ministry on Nov. 29
and then confiscated materials related to Futenma airfield's
relocation and other documents. The task force is believed to have
questioned the former DFAA Naha bureau chief about the circumstances
of the U.S. military's realignment.

The questioned retiree was a noncareer senior official, who served
as director general of the DFAA's Naha Defense Facilities
Administration Bureau from January last year through August this
year. His retirement was pushed back on Moriya's authority,
according to the sources.

Japan and the United States have finalized their talks over the
realignment of U.S. forces in Japan, incorporating an agreement to
relocate Futenma airfield in Okinawa Prefecture to a coastal area of
Camp Schwab in the island prefecture's northern coastal city of

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Nago. In exchange for Futenma relocation, the Japanese and U.S.
governments also agreed on a plan to move about 8,000 U.S. Marines
from Okinawa to Guam. The Japanese government plans to build U.S.
military facilities and construct housing for about 3,500 families.
For Guam plans, the Japanese government will invest in a
private-sector corporation that will undertake construction and
management. The total cost of Guam relocation is estimated at 6.09
billion dollars (730 billion yen).

Japanese construction and trading companies are aiming for the Guam
relocation project. In addition, Yamada Corporation, a trading firm
dealing in equipment for the Self-Defense Forces, and Nihon Mirise
Corporation, established by Motonobu Miyazaki, 69, who was a
managing director of Yamada Corp. and has been rearrested on the
charge of bribery, also desired contracts for the project. The task
force seems to be investigating the whole picture of defense
interests, suspecting that Moriya might have favored Miyazaki.

8) Police to arrest MSDF officer today for Aegis data leaks: First
application of the Japan-US secrecy protection law

MAINICHI (Page 1) (Abridged)
December 13, 2007

A 33-year-old Maritime Self-Defense Force petty officer second class
assigned to the MSDF's Escort Flotilla 1 took out classified data
about an Aegis ship. In this incident of information leakage,
Kanagawa prefectural police and MSDF shore police will arrest a
34-year-old MSDF lieutenant commander today on the charge of
violating the Japan-U.S. Secret Protection Law. The lieutenant
commander was with a program unit (currently the Ship Development
Group) in charge of maintaining and controlling systems for
Aegis-equipped ships. The police will shortly send papers to
prosecutors on several MSDF officers, including a 43-year-old
lieutenant commander and a 49-year-old lieutenant, who were both
instructors at the MSDF's 1st Service School in the city of Etajima,
Hiroshima Prefecture.

In 2002, the lieutenant commander allegedly gave classified data
about an Aegis ship to the lieutenant commander who was an
instructor at the MSDF's 1st Service School. The two MSDF officers
got to know each other when they were studying in the United States.
The former 1st Service School instructor is believed to have asked
for Aegis data.

The Aegis data was passed on to the lieutenant who was also an
instructor at the 1st Service School, police said. The lieutenant
copied a data file and gave its copies to several dozen MSDF members
who were trained at the 1st Service School and who were not
authorized to handle classified data. Data file copies were
multiplied and proliferated to the crew of two MSDF destroyers,
Shimakaze and Hatsuyuki. In the end, the petty officer second class
seems to have received the data from a 23-year-old leading seaman,
who was the petty officer second class' colleague when assigned to a
destroyer.

9) Upper House committee likely to take vote on new antiterrorism
bill in early January; Secretaries general of six parties to meet
today

TOKYO SHIMBUN (Page 2) (Full)
December 13, 2007

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The possibility became strong yesterday that the House of
Councillors Committee on Foreign Affairs and Defense will delay
until early next month a vote on a new antiterrorism special
measures bill to resume the Maritime Self-Defense Force's refueling
operation in the Indian Ocean.

In a meeting today of the secretaries general of both Diet chambers
from six ruling and opposition parties, the ruling camp, which aims
to enact the bill during the current Diet session, will convey its
policy of re-extending the ongoing session, which will end on Dec.
15, until the middle of January and seek understanding from the
opposition bloc. However, if a second vote on the new antiterrorism
bill in the Lower House is delayed to next January, the regular Diet
session will convene amid the ruling and opposition remaining in
standoff.

The largest opposition party Democratic Party of Japan (DPJ or
Minshuto) has insisted that its is necessary to shed light on a
series of scandals involving the Defense Ministry before putting the
bill to a vote. The DPJ demands 1) hearing from former Yamada Corp.
executive Motonobu Miyazaki, who is under arrest, 2) Diet testimony
by former Defense Minister Fumio Kyuma and intensive deliberations
on reform of the Defense Ministry. The party thinks about 40 hours,
excluding deliberations on the scandals, are needed.

The committee has spent about 17 hours for deliberations on the bill
as of yesterday. Since only five working days remain before the end
of the year, it is difficult to conclude both the clearing up of the
scandals and deliberations on the bill.

DPJ Secretary General Yukio Hatoyama yesterday told reporters in the
Diet building: "We will have to shed light on the scandals.
Considerable time will be needed. It is not that easy (to take a
vote on the bill before the end of the year)."

Four opposition parties -- the DPJ, the Japanese Communist Party,
the Social Democratic Party, and the People's New Party -- will
decide in a party-head meeting today to oppose a re-extension of the
Diet session. The ruling coalition, however, intends to take a vote
on a re-extension in a plenary session on Dec. 14 of the House of
Representatives.

10) SDP head Fukushima: If new antiterrorism bill is readopted in
Lower House, censure motion against prime minister should be
submitted

MAINICHI (Page 5) (Full)
December 13, 2007

Asked by the press about her party's response if the ruling camp
takes a second vote on a new antiterrorism special measures bill in
the House of Representatives, Social Democratic Party (SDP)
Chairperson Mizuho Fukushima said: "That will lead to useless Upper
House debate. It means neglecting public opinion. I think a censure
motion against the prime minister should be submitted to the Diet."

11) Re-extension of Diet session to be adopted in Lower House
tomorrow: Ruling parties calling for participation of opposition
parties in social security talks

SANKEI (Page 5) (Excerpts)

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December 13, 2007

Following a meeting between Prime Minister Yasuo Fukuda and New
Komeito head Akihiro Ota, the government and the ruling parties
yesterday formally decided to re-extend the extraordinary Diet
session, which is to end on Dec. 15, until January 15 next year.
They will present their decision to the Upper House president and
the Lower House speaker today and adopt it at a plenary session of
the Lower House on the 14th. Prior to this, Liberal Democratic Party
(LDP) Secretary General Bunmei Ibuki yesterday secretly met with
Democratic Party of Japan (DPJ or Minshuto) Secretary General Yukio
Hatoyama and others at a Tokyo hotel. Ibuki during the meeting
called for putting the new antiterrorism special measures
legislation to a vote in the Upper House before year's end. He also
proposed setting up a social security national council, a
consultative panel for the ruling and opposition parties to discuss
social security and the tax system.

Though the secret meeting bogged down, Ibuki intends to call for the
opposition camp's cooperation for the new antiterror legislation and
participation in the envisaged panel by holding a meeting of the
secretaries general of both the ruling and opposition parties today.

SIPDIS
After this meeting, he will hold a meeting of Diet Affairs Committee
chairs of both the ruling and opposition parties of the Lower and
Upper Houses, where the secretaries general of the LDP and the DPJ
are expected to propose re-extending the Diet session.

Four opposition parties yesterday afternoon held a meeting of Diet
Affairs Committee chairs and confirmed a policy of responding to a
meeting of secretaries general but opposing the proposal for
re-extending the Diet session and putting the new antiterror
legislation to a vote before year's end.

The LDP and New Komeito will ask the opposition camp to continue
deliberations at the Upper House Foreign Affairs and Defense
Committee and seek a roll call on the bill when deliberation time
exceeded 40 hours. If matters proceed as envisaged, the legislation
will be voted down in the Upper House and be put to a vote again at
a Lower House plenary session. However, with the opposition camp
standing firm on their stance of giving priority to pursuing
scandals involving the Defense Ministry, prospects for whether this
will go according to plan have yet to be ascertained.

12) Government breaks commitment to resolve pension issue; Ruling
camp worrying about negative impact, DPJ aiming to make it a
campaign issue in Lower House election

MAINICHI (Page 5) (Excerpts)
December 13, 2007

Now that the Liberal Democratic Party's campaign pledge to conclude
by the end of next March the identification of holders of 50 million
pension accounts that remain unidentified will likely be broken,
there was growing concern yesterday in the government and ruling
parties that they may come under heavy fire now from the public.
Meantime, the main opposition Democratic Party of Japan (DPJ or
Minshuto) intends to pursue the responsibility of Health, Labor and
Welfare Minister Yoichi Masuzoe and strengthen its offensive with an
eye on making the pension fiasco a campaign issue in the next House
of Representatives election.

In a session yesterday of the Lower House Committee on Health, Labor

TOKYO 00005537 010 OF 010


and Welfare, DPJ lawmaker Akira Nagatsuma, who discovered the
pension fiasco, questioned Masuzoe and urged him to thoroughly
investigate the ledger of pension records.

Masuzoe: "I expressed my determination to Mr. Nagatsuma to resolve
the ledger problem. But there is a financial and manpower problem."

Nagatsuma: "You are saying that more manpower is needed. It sounds
you have lost your drive."

Masuzoe presumed that if a reinvestigation of the more than 800
million pages of paper work was carried out, more input errors into
the computer system would be found out. Prior the committee session,
Liberal Democratic Party (LDP) Diet Committee Chairman Tadamori
Oshima told Masuzoe: "You should better not make remarks that can be
taken as excuses." His remark indicated that the government and
ruling coalition were alarmed by the pension issue.

13) Bali Climate Change Conference: U.S. comes up with
counterproposal for cuts in greenhouse gas emissions without
numerical targets; Japan supports it

MAINICHI (Page 2) (Excerpts)
December 13, 2007

It was found on Dec. 12 that the U.S. and other countries came up
with a proposal for cuts in greenhouse gas emissions without
numerical targets to counter the Bali roadmap covering the next two
years jointly proposed by the chairmen at the 13th session of the
Conference of the Parties to the United Nations Framework Convention
on (COP13) (Bali Climate Change Conference).

The chairmen's proposal calls on industrialized countries to set
their own reduction targets. The U.S. also opposed this proposal,
contending that future discussions would be biased.

The joint chairmen's proposal was submitted on Dec. 11, and
participating countries expressed their countries' opinions. An
informal meeting led by working-level officials was held on Dec.
12.

The chairmen's proposal called for 25 PERCENT -40 PERCENT cuts by
2020 compared with 1990 levels. However, according to more than one
informed source, Russia made a counterproposal noting that it would
be necessary for all countries to strengthen efforts and act jointly
for more cuts in greenhouse gas emissions. The U.S. and Japan
supported this proposal.

SCHIEFFER

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