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Cablegate: The Japan Economic Scope--December 28, 2007

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FM AMEMBASSY TOKYO
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INFO RUEHFR/AMEMBASSY PARIS 5926
RUEHFK/AMCONSUL FUKUOKA 5230
RUEHNAG/AMCONSUL NAGOYA 3925
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PARIS PLEASE PASS TO USOECD
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E.O. 12958: N/A
TAGS: ETRD ECON JA ZO EAGR
SUBJECT: The Japan Economic Scope--December 28, 2007

1. (U) This cable contains the Japan Economic Scope from
December 28, 2007.

2. (SBU) Table of Contents

Japanese Government Moves
3. Personnel Shuffle at MOFA?
4. Reg Reform is Back
5. Japan Halts Plans to Start Hunting Humpback Whales

Planes and Trains
5. Rail Improvement Cut into Domestic Aviation Business
6. JAL Reforms Increase in Assertiveness, Fail to Make a
Difference
7. ANA Expands Cargo Service but Does Not Expect Immediate
Returns
8. Japan Plans 'Smart' Pass for Asia Mainland

Climate Change
9. METI-MOE Joint Report: "Japan's Kyoto Target Can Be
Achieved"

Fiscal Policy
10. FY08 Budget Approved by Cabinet
11. DPJ Tax Proposals Highlight Tax Cuts

Financial Issues
12. Japan as Number 2 -- And Falling?
13. Tokyo Stock Exchange Threatens to De-list Sanyo over
Accounting Problems
14. FSA Announces Plan to Strengthen Japan's Capital Markets
15. NikkoCitigroup, Keio University Announce Joint Study Group
on Tokyo as Global Financial Center
16. Advantage Partners Offer $2.2B Bid for Tokyo Star Bank

Technology
17. Willcom, KDDI Win Next-generation Licenses for Wireless
Broadband
18. Okinawa Starts Regional GIX Demonstration Experiment

Energy
19. JBIC to Give Its Largest Loan Ever to Abu Dhabi National
Oil Company
20. Japan Firms Ink Nuclear Energy Deal with Kazakhstan

NOVA English School Troubles
21. G.communication Chair Inayoshi Comments on NOVA Acquisition

Royal News
22. Emperor's 74th Birthday

Sports
23. New Crop of Japanese Players to Spice up Majors in 2008
24. Long Suffering Red Sox Fans Finally Have Something to
Divert Attention

25. This Week's Cables

-------------------------
JAPANESE GOVERNMENT MOVES
-------------------------

3. (U) Personnel Shuffle at MOFA?

Media outlets have described a number of upcoming personnel
shifts at the Foreign Ministry, but we have been unable to
confirm any of them.

According to Mainichi, MOFA's senior bureaucrat, Vice Foreign
Minister Shotaro Yachi will retire and be replaced by Deputy
Foreign Minister Mitoji Yabunaka, who is known well to the
Embassy and in Washington. According to a Sankei report,
Yabunaka's appointment will be approved at a cabinet meeting
January 15.

Mainichi indicated that Yachi refused a request to remain in
his post until the G-8 summit next summer. He has accepted a
teaching post at Waseda University.

According to Asahi on December 27, Yabunaka will be replaced by
Kenichiro Sasae, who has been serving as Director General for
MOFA's Asian and Pacific Affairs Bureau. Akitaka Saiki, the

TOKYO 00005689 002 OF 010


DCM in Japan's Embassy in Washington, will replace Sasae.

The newspaper noted that Yabunaka, Sasae, and Saiki have all
been very involved in negotiations with North Korea, and
speculated that their appointments represent an effort by the
Fukuda administration to engage more vigorously on North Korea
than before.

Meanwhile, Asahi also reported that Ichiro Fujisaki will
replace Ryozo Kato as Japan's envoy in Washington. Fujisaki
has been Japan's top diplomat in Geneva. Mainichi also
reported the same shuffle, but said it would not take place
until at least next July's G-8 summit.

According to some sources, Fujisaki is known to be very pleased
with himself--possessing a certain arrogance that sometimes
does not sit well with his interlocutors. Or, as one source
put it, the difference between Fujisaki and Kato is the
difference between night and day.

When we asked a mid-level official at MOFA who would likely be
familiar the personnel shifts being reported in the media, he
was very tight-lipped and said he could not confirm any of the
movements.

This usually means that the reports are accurate and the formal
announcements will come shortly. (ECON: Nicholas Hill)

4. (SBU) Reg Reform is Back

The last round of Regulatory Reform talks between the United
States and Japan took place in December, with a number of
different working groups convening simultaneously in Tokyo.

In the Cross Sectoral Working Group, the two sides agreed to
set aside some agricultural issues, to be taken up January 10-
11, again in Tokyo.

An inter-agency delegation led by USTR and USDA will
participate in those talks.

The U.S. recommendations addressed at that time are maximum
residue limits, food additives, animal products, and plant
quarantine issues. Japanese recommendations are BSE measures,
organic crop products, and Unshu oranges.

The two sides are covering each other's recommendations in
advance of drafting a Report to Leaders, expected to be
exchanged next summer.

For more information on the talks, please contact us. (ECON:
Nicholas Hill)

5. (SBU) Japan Halts Plans to Start Hunting Humpback Whales

In a press conference on December 21, Chief Cabinet Secretary
Nobutaka Machimura announced that Japan will suspend its plans
to start hunting 50 Humpback whales in the Southern Ocean. The
Asahi Shimbun reported that this decision was made as a
response to a request by International Whaling Commission (IWC)
Chair and U.S. Commissioner to the IWC, William Hogarth.
During a mid-December visit to Japan, Mr. Hogarth also promised
to work at normalizing the highly divisive IWC.

Since 2005, Japan has expanded its annual research whaling
program in the Antarctic by catching 50 fin whales and doubling
the Minke whale catch to 850. From the 2007/08 season, it had
also planned to add 50 Humpback whales. This planned addition
faced particularly strong criticism from anti-whaling nations
such as Australia because of the species' popularity with whale
watching tours. As a sign of increased opposition to Japan's
research whaling, Australian PM Rudd announced a plan to
dispatch patrol vessels to monitor whaling activities.

Although whale meat is persistently popular in Japan, the
suspension of the hunt should not negatively affect the
marketplace. Hiroshi Nakada, President of Geishoku Kabo (Whale
Food Lab), a GOJ-created whale meat marketing company, told
Post that because the quality of humpback whale meat is not
high, his business would not suffer. For more information
please see Tokyo 5536 and 2006 Tokyo 4424. (ECON: Keiko
Kandachi)

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PLANES AND TRAINS
-----------------

6. (SBU) Rail Improvement Cut into Domestic Aviation Business

The bullet train line (shinkansen) planned to link the nation's
main island of Honshu and Hokkaido will get a budget boost next
fiscal year as construction barrels toward its scheduled
completion at the end of fiscal 2015, according to a December
26 Nikkei news article.

This is bad news for the domestic aviation industry which has
already been struggling under weak sales and increasing loss of
passengers to the shinkansen. A representative of a Japanese
low cost carrier told us his carriers' few remaining profitable
routes are Hokkaido, Nagoya-Osaka and Naha routes.

JR Tokai announced plans to self-finance a Tokyo-Nagoya
magnetic levitation train line slated to begin operation in
2025. Maglev service would shorten the trip between the two
metropolitan areas to 40-50 minutes. JR Tokai outlined the
initiative in April and estimates the cost of building the 290
km route at 5.1 trillion yen. The decision to use its own
money to build the maglev shinkansen line reflects its concern
over the lack of certainty of future government funding.

ANA officials told us that before the latest "Shinkansen 700"
cars came into service last summer, travel time between Tokyo
and Kansai was about the same by train or by air, if you
include the time needed to pass through airport security. But,
the new train service is now faster than air travel. In
response, both ANA and JAL lowered ticket prices to match the
cost of shinkansen tickets, but have not, so far, seen an
increase in passenger flow. (ECON: Charlotte Crouch)

7. (SBU) JAL Reforms Increase in Assertiveness, Fail to Make a
Difference

JAL has continued its internal reforms with increasing
assertiveness. Despite telling us last week they had no plans
to sell more hotels, news reports this week indicated they sold
hotels in London and Saipan for eight billion yen ($70 million).

JAL finally reached an agreement with its largest labor union,
JALFIO, on company retirement revisions, including a 10 percent
cut in retirement benefits according to a December 21 Nikkei
article. JALFIO represents 70 percent of the JAL's unionized
workforce.

Nikkei December 24 reported JAL has asked a Brazilian company
to provide 20 pilots--a move JAL told us a few months ago they
would not consider. At that time, we noted Korean Air makes
extensive use of lower cost pilots, mostly from Latin America,
but JAL officials said such a strategy would not work for them.

A relatively minor story about JALWAYS attendants serving
leftover food to customers comes at a time the company and its
subsidiaries can least weather bad publicity. JAL's passenger
load is down 3.4 percent from last year, but international load
rose one percent. ANA meanwhile, saw it passenger load rise
8.8 percent to an all-time high. (ECON: Charlotte Crouch)

8. (SBU) NA Expands Cargo Service but Does Not Expect
Immediate Returns

ANA officials confirmed to us details of a Nikkei article
indicating the company will take a 34 percent stake in a cargo
delivery joint venture with Nippon Express and Kintetsu World
Express. The two delivery companies will each hold a 28
percent stake in the venture.

However, ANA officials said cargo business remains slow and it
could be years before it picks up again.

We also discussed Japan's ODA projects supporting road and rail
construction in Laos, Cambodia, Vietnam and Thailand as part of
a GOJ strategic plan to expand markets for Japanese products in
the region. Both ANA and JAL officials were skeptical the plan
could increase the air cargo market into or out of Japan.


TOKYO 00005689 004 OF 010


JAL officials pointed out, despite heavy GOJ investment in the
Shanghai airport, no one in China knows that the Japanese built
it. Officials from both airlines saw no value in the GOJ's
attempts to increase the potential cargo market on the Asia
mainland using ODA funds to increase the region's
transportation infrastructure.

Nippon Express and Kintetsu World Express originally sought to
negotiate a tie-up with JAL but the air carrier, under pressure
from it main lenders to restructure its money-losing cargo
business, could not seal the deal. (ECON: Charlotte Crouch)

9. (U) Japan Plans 'Smart' Pass for Asia Mainland

Japanese transport ministry official Hiroyuki Hotta told
Reuters December 21 the GOJ plans to develop a card which can
be used to pay train fares throughout Asia. Smart cards, which
are held briefly over a scanner to open station ticket gates,
are widely used in Tokyo, Seoul and Hong Kong. But they have
yet to transcend borders, because there are not yet
international standards for the data they contain.

Embassy officials met with Tokyo Metro (subway) officials last
month and they boasted Japan has recently developed a Smart
Card which will work on all trains lines in Japan, regardless
of the operator, increasing the ease with which passengers can
move from one transit system to another.

Japan's transport ministry aims to solve the international
challenge by developing cards with chips that work in different
countries. "It's significant for such a system to be developed
in a region (like Asia) where there are subways and commuter
railways in densely populated areas," Hotta said. The smart
cards should be in use by 2011, Hotta said.

An independent consultant who spoke with Embassy officials last
week detailed plans for GOJ's development of transportation
systems on the Asia mainland. Japan's work on developing
transport systems in Asia makes it the ideal place to also
develop a "Smart Card" that can be used on all system. (ECON:
Charlotte Crouch)

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CLIMATE CHANGE
--------------

10. (U) METI-MOE Joint Report: "Japan's Kyoto Target Can Be
Achieved"

A joint committee of the Ministry of Economy, Trade and
Industry's (METI) Industry Structure Council and the Ministry
of Environment's (MOE) Central Environment Council December 21
published its final report on Japan's revised plan to reduce
greenhouse gas (GHG) emissions to meet its Kyoto Protocol
target.

The report says industry and other sectors will need to
implement extra measures in order to reduce CO2 emissions by
the equivalent of an additional 35-36 million tons.

These new measures include a reinforced industry voluntary
action plan (to cut 18 million-tons), revision of the Energy-
Conservation Law (9.5-11.5 million tons) and national energy
conservation campaigns such as "Cool Biz" and "Eco-Drive"
(6.78-10.5 million tons).

According to the report, if all these plans are successfully
implemented, Japan will be able to attain its target of cutting
GHG emissions by 6 percent from the 1990 level by 2012.

However, according to a December 27 Nikkan Kogyo Shimbun
article, there is some disagreement on the accuracy of the
report's findings. Dr. Yoichi Kaya, chair of the METI-MOE
joint committee and Director-General for the Research Institute
of Innovative Technology for the Earth (RITE, a METI-related
organization), admitted that the report is "full of
uncertainty." (ECON: Keiko Kandachi)

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FISCAL POLICY
-------------


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11. (U) FY08 Budget Approved by Cabinet

Japan's Cabinet December 24 approved the central government
draft regular budget for FY08 (April 2008--March 2009),
clearing the way for its submission to the Diet's ordinary
session to be convened in January.

The regular general account budget for FY08 shows an increase
of 0.2 percent in overall outlays over the initial FY07 budget,
primarily due to increases in mandatory spending items, such as
social security.

However, discretionary outlays have been cut by 1.1 percent
compared to the initial FY07 budget. This includes cuts in
public works spending of 3.1 percent and ODA spending of 4.0
percent.

The budget supports government priorities, such as addressing
regional disparities, with more resources, including an
increase in transfers to local governments of 4.6 percent and
more spending for SMEs (Small and Medium Enterprises), which
will increase 2.2 percent. The FY08 budget projects a slight
decline in government bond issuance (a rough proxy for the
central government fiscal deficit on a national accounts basis)
to 4.8 percent of GDP, compared to a projected 4.9 percent of
GDP in FY07. (FINATT: Shuya Sakurai/Maureen Grewe)

10. (U) DPJ Tax Proposals Highlight Tax Cuts

The Democratic Party of Japan (DPJ) December 25 announced its
FY08 tax proposals, which focus on tax cuts.

Many of the proposals are at odds with those of the ruling
coalition, indicating the budget may face a tough time in the
Diet when consideration of tax bills begins next year. Main
differences include the treatment of the gasoline surcharge tax,
taxes on financial income, and the use of consumption tax
revenue.

In contrast to the ruling LDP/Komeito recommendation to extend
the gasoline tax surcharge for 10 years and maintain its use
for road construction, the DPJ proposes to eliminate the
surcharge, as well as the earmark underlying taxes for roads,
instead having the funds added to general revenue.

Through this measure, the DPJ reportedly wants to reform the
pork-barrel nature of road construction and gain public
approval through lower gasoline prices. Regarding taxes on
financial income, the DPJ proposes allowing the current tax
break on capital gains to expire as planned next year with the
rate to rise back to 20 percent, while extend the special 10
percent rate on dividend income.

The ruling parties have proposed extending the 10 percent rate
on both taxes through 2010 with a ceiling of five million yen
for capital gains and one million yen for dividends. Capital
gain or dividend income above those ceilings would be taxed at
20 percent.

For the consumption tax, the DPJ, like the ruling coalition,
did not call for an immediate hike, but instead proposed use of
all revenues from the current five percent consumption tax
exclusively to fund basic pensions, and for an overhaul of the
nation's social security programs as part of which an increase
in the consumption tax rate could be considered.

A Nikkei report estimated that the DPJ's proposals would result
in the loss to central and regional governments of a combined
2.6 trillion yen in revenues from the elimination of the road
tax surcharge alone. (FINATT: Maureen Grewe)

----------------
FINANCIAL ISSUES
----------------

12. (U) Japan as Number 2 -- And Falling?

Japan may be enjoying its longest sustained economic growth in
the postwar period -- over five years now with no downturn --
but, by other measures, Japan's economy remains in a funk.

According to a December 27 Nikkei report, Japan's share of

TOKYO 00005689 006 OF 010


global gross domestic products slipped below 10 percent for the
first time in almost a quarter of a century. At 9.1 percent of
global GDP, Japan's share of the world's economic pie is 50
percent off its peak in 1994.

According to the Nikkei report, which cited data released by
the Cabinet Office, Japan's nominal GDP was up 1.4 percent in
yen terms in 2006 but down 4 percent in dollar terms at some
4.37 trillion dollars, reflecting the yen's erosion in foreign
exchange markets last year.

Nikkei noted that Japan's ranking in per income data also
slipped, and the country global presence was bound to slip
further if reform efforts bog down. (ECON: Nicholas Hill)

13. (U) Tokyo Stock Exchange Threatens to De-list Sanyo over
Accounting Problems

The Tokyo Stock Exchange December 26 threatened troubled
Japanese electronics manufacturer Sanyo Electric with delisting
after it submitted six years of corrected earnings reports.
Sanyo, which is just starting to recover after a major
restructuring drive, revised earnings reports for six years
beginning with FY2000 and admitted earlier reports, had
underestimated losses.

"We take the earnings correction very seriously," Sanyo
president Seiichiro Sano told a press conference at the
company's base in Osaka while bowing deeply. "We will create a
system so something like this is never repeated."

The Tokyo Stock Exchange said it would consider delisting Sanyo,
whose shares fell 3.60 percent December 26 despite strong gains
on the broader market.

Japan's Securities and Exchange Surveillance Commission
recommended the Financial Services Agency fine Sanyo Electric
Co. for alleged accounting irregularities, according to
December 25 Nikkei article.

The watchdog said Sanyo recorded a smaller loss amount at an
affiliated company than it had actually incurred for the fiscal
first half that ended in September 2005.

The SESC recommended FSA fine Sanyo 8.35 million yen (roughly
$70,000 dollars.) (ECON: Charlotte Crouch)

14. (U) FSA Announces Plan to Strengthen Japan's Capital
Markets

On December 21, the Financial Services Agency (FSA) announced
its Plan for Strengthening the Competitiveness of Japan's
Financial and Capital Markets as part of the government's long
-term plan to develop Tokyo as a global financial center.

Based on this plan, FSA will submit bills to revise the
Financial Instruments and Exchange Law during the 2008 ordinary
Diet session, which begins mid-January, and hopes to implement
the amended law from next summer.

The four main points of the Plan are: (1) bolstering the
confidence and vigor of the markets; (2) ensuring a business
environment that vitalizes the financial services industry and
promotes competition; (3) improving the regulatory environment,
and; (4) improving the broader market environment. For more
details, please click here. (ECON: Satoshi Hattori)

15. (U) NikkoCitigroup, Keio University Announce Joint Study
Group on Tokyo as Global Financial Center

At a December 26 financial Seminar, Nikko Citigroup and Keio
University's Global Security Research Institute (a project of
former minister and Koizumi Cabinet Economic Guru Heizo
Takenaka) announced the launch of a joint study group on the
GOJ's initiative to make Tokyo an international financial
center.

The study group defined three conditions for international
financial centers, i.e. (1) a substantial volume of
transactions of stocks, bonds, and other commodities or
financial instruments; (2) substantial volume of investment
banking practices, such as new issuance of shares, debt

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instruments or M&A deals, and; (3) significant numbers of
regional headquarters of world's leading financial institutions.

For Tokyo to meet such conditions, the study group is convinced
that continued stable growth of the Japanese economy and
expansion of trading markets and new issuances are essential.
They also said opening Japan's financial and business
activities to more foreign competition is inevitable, though
this will present significant hurdles for Japanese businesses.

The study group considers that to make Tokyo as an
international financial center should not be the ultimate goal,
but it should be a vehicle for achieving a larger goal, namely,
for Tokyo to become an international business center.

To that end, the announcement called for Japan to further
rejuvenate its asset management capability and "let money work"
through competition between domestic and foreign asset
management companies.

The study group will conduct a three-year joint research
project and issue a final report in mid 2010. (ECON: Satoshi
Hattori)

16. (U) Advantage Partners Offer $2.2B Bid for Tokyo Star Bank

Japanese private equity fund Advantage Partners said it would
launch a bid for Tokyo Star Bank Ltd worth as much as 252
billion yen , allowing investment fund Lone Star to cash out of
its 68 percent stake in the lender, according to a December 21
Reuter's article.

Advantage Partners said it would offer 360,000 yen for each of
the 700,000 Tokyo Star shares owned by Lone Star, a 2.3 percent
premium over Tokyo Star's December 21 closing share price of
352,000 yen and 8.5 percent above its three-month average price
of 331,661 yen.

The news brings to an end a torturous few months for the funds,
which have had to steer the deal through the storm in global
credit markets and a tough regulatory review. (ECON: Charlotte
Crouch)

----------
TECHNOLOGY
----------

17. (U) Willcom, KDDI Win Next-generation Licenses for
Wireless Broadband

On December 21st, MIC granted new licenses to Carlyle-owned
Japanese PHS (personal handy-phone system) service provider,
Willcom Inc, and a KDDI-led consortium, Wireless Broadband
Planning KK (WBPK) to provide next-generation 2.5 GHz wireless
broadband service.

The services will allow quick Internet access and high-speed
data transmission while the user is traveling by car or train.
WBPK, which also includes a stake by Intel Corp., will provide
the service utilizing WiMAX (Worldwide Interoperability for
Microwave Access) technology, while Willcom will offer its
services via next-generation PHS technology. The two plan to
launch the service in 2009. (ECON: Kaoru Nakata)

18. (U) Okinawa Starts Regional GIX Demonstration Experiment

Two Okinawa IT companies, First Riding Technology Inc (FRT) and
Okinawa Cross Head Inc., have begun a Global Internet Exchange
(GIX) experiment intended to better link Okinawa, mainland
Japan and Hong Kong starting December 15.

The two companies intend to develop a direct internet
connection service to mainland Asia, rather than going through
the internet access hub in mainland of Japan or the U.S., in
order reduce communication costs and increase the speed of data
transmission.

The companies are leasing a submarine cable between Okinawa and
Taiwan and another between Taiwan and Hong Kong from FLAG
Telecom Inc. (an Indian owned company) and provide global
internet access service to the companies who use FRT's data
center.

TOKYO 00005689 008 OF 010

Thus far, four Japanese companies, Calbee Foods, Gaitame.Com,
Index Okinawa and Cybazu Inc. have signed on to use this
service beginning in 2008.

The Okinawa Prefectural Government is preparing a budget of
about $36,000 for FY2007 and about $82,000 for FY2008 to aid
this regional GIX experiment and to reduce users' costs. (NAHA:
Thomas M. Kreutzer/Akinori Hayashi)

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ENERGY
------

19. (U) JBIC to Give Its Largest Loan Ever to Abu Dhabi
National Oil Company

The Japan Bank for International Cooperation (JBIC) will extend
an advance payment loan of three billion dollars to the Abu
Dhabi National Oil Company (ADNOC) for infrastructure, oil
exploration and increased oil production according to JBIC
officials. The loan, estimated to be the largest ever granted
by JBIC, will allow Japanese oil companies access of up to
120,000 barrels of crude oil per day over a five-year or longer
period. The deal is the result of an MOU signed between JBIC
and ADNOC during former Prime Minister Abe's visit to the UAE
in April 2007. In addition to these latest monies, JBIC and
other banks will also extend $2.2 billion in loans to finance a
power and water desalination plant in Abu Dhabi. This will
bring Japan's total commitments to the Emirates in this year
alone to over five billion dollars. Japan currently imports
approximately one-third of its oil from the UAE. (ECON: Sally
Behrhorst/Eriko Marks)

20. (U) Japan Firms Ink Nuclear Energy Deal with Kazakhstan

Sumitomo Trading Company and Kansai Electric Power Co. signed a
deal December 26 with Kazakhstan's state-run energy company,
Kazatomprom, to process uranium for power generation.

Under the deal, Kazatomprom will reconvert enriched uranium
into powder at a nuclear fuel facility in Kazakhstan.

Kansai Electric and Sumitomo will provide expertise and funding
for necessary modifications to the plant which is capable of
producing nearly twice as much nuclear fuel as Japan's current
needs.

The companies released no financial information on the deal,
but Nikkei estimates upgrades to the processing plant alone at
Y70 - Y80 billion ($615 - $700 million).

The move is part of Japan's larger effort to forge closer ties
with uranium-rich Kazakhstan to reduce dependence on Middle
Eastern oil. Several other deals have been inked since
Junichiro Koizumi became the first Japanese Prime Minister to
visit Kazakhstan in August 2006. (ECON: Sally Behrhorst)

----------------------------
NOVA ENGLISH SCHOOL TROUBLES
----------------------------

21. (SBU) G.communication Chair Inayoshi Comments on NOVA
Acquisition

Nagoya-based G.communication will not be able to fulfill its
November promise to hire all former NOVA employees and reopen
branches nationwide.

On December 27, Nagoya-based G.communication Chair Masaki
Inayoshi told us, as of December 24, sub-unit G.education's
buyout of bankrupt NOVA extended to only 126 of the 200 schools
it previously said it would acquire. Inayoshi would prefer to
hire all former NOVA employees with satisfactory performance
records, but his financial backers do not consider such a broad
move financially responsible. He indicated G..education is
having difficulties reopening former NOVA branches in some
areas due to disagreements with landlords about rent arrears.
Inayoshi believes NOVA's failure was primarily the result of
its long-term payment program in which students paid a lump sum
between 500,000 and one million yen per year for "NOVA points"
that could be exchanged for future class time. By shortening

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the prepayment time to one month, G.education will be able to
provide courses and maintain financial and operational
stability.

To attract former NOVA students, G.education will offer a 75
percent discount for holders of NOVA class points. (Nagoya:
Jonas Stewart/Tamiki Mizuno)

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ROYAL NEWS
----------

22. (U) Emperor's 74th Birthday (U)
Japan's Emperor Akihito and members of the royal family greeted
thousands of well-wishers at the Imperial Palace as they
celebrated his 74th birthday on December 23, 2007.

------
SPORTS
------

23. (U) New Crop of Japanese Players to Spice up Majors in
2008

With the 2007 transfer season now more or less over, another
class of top-notch Japanese baseball players have moved to the
major leagues.

Top of the list are four veteran pitchers, three of whom have
recent Japan Series experience or were part of the Japan
National Team that won the 2006 World Baseball Classic. Unlike
in previous years, this year's migrants all came via free-
agency and not the expensive (for U.S. teams, at least) posting
system that brought Red Sox star Daisuke Matsuzaka to Boston
this year.

Meanwhile, three Japanese major leaguers, all World Series
veterans, jumped to new teams in the off-season. As a result
of all these moves, more American fans than ever before will
have the chance next season to witness first hand the high
caliber of current Japanese play.

The chart below lists the Japanese players who signed new
contracts this off-season, their likely positions next season,
and their new and former teams. (ECON: David DiGiovanna)

Name/Age Position New Team Fmr. Team
Masahide KOBAYASHI, 33 RHP (r), Cleveland, Lotte Marines
Yasuhiko YABUTA, 34 RHP (r), Kansas City, Lotte Marines
Kazuo FUKUMORI, 31 RHP (r), Texas, Rakuten
Hiroki KURODA, 32 RHP (s) Los Angeles (NL), Hiroshima
Kosuke FUKUDOME, 30 CF, Chicago (NL), Chunichi
Kazuo MATSUI, 32 2B, Houston, Colorado
Tadahito IGUCHI, 33 2B San Diego, Philadelphia
So TAGUCHI, 38 CF/LF, Philadelphia, St. Louis

24. (U) Long Suffering Red Sox Fans Finally Have Something to
Divert Attention

It has been a long slog for Red Sox fans in Tokyo. Two full
months have passed since they watched their team wrap up their
second World Series title in four years. The days have grown
shorter and the temperatures have slipped downward.

Other than watch Daisuke Matsuzaka and Hideki Okajima appear
endlessly on silly TV talk and game shows, the only solace for
long suffering members of Red Sox Nation is to turn to football.

The New England Patriots are poised to finish a perfect regular
season on December 30 (Tokyo time), but there are no Japanese
players on the Patriots' roster -- therefore, no live coverage
on nationwide television in Japan.

NBA basketball is on Japan's airwaves. The Celtics may have
the best record in the league, but--after watching the Red Sox
sweep eight straight World Series games and the Patriots win 15
straight--can Japan's Red Sox fans find solace slumming it
with a team that's only 24-3? (ECON: Nicholas Hill)

25. (SBU) THIS WEEK'S CABLES
5670 Fukuda's Visit to China
5655 DNSA Price Engages Japanese on Doha, Beef, China and

TOKYO 00005689 010 OF 010


Climate
5644 Japan Donates to Peacekeeping Efforts in Eastern Chad
5629 Beef

26. (U) This SENSITIVE BUT UNCLASSIFIED e-newsletter from U.S.
Embassy Tokyo's Economic Section, with contributions from the
consulates, is for internal USG use only. Please do not
forward in whole or in part outside of the government. The
Scope is edited this week by Charlotte Crouch
(CrouchCA@state.gov) and Joy Progar (ProgarJ@state.gov).
Please visit the Tokyo Econ Intranet webpage for back issues of
the Scope. Apologies, this option is only available to State
users. Please contact Joy Progar if you are from a different
agency and are interested in a back issue.
DONOVAN

© Scoop Media

 
 
 
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