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Cablegate: Japanese Morning Press Highlights 08/24/09

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TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA

SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 08/24/09

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Index:

Foreign and security affairs:
1) Japan to host in Tokyo this November an Afghan peace conference
(Asahi)
2) Ministry of Economy, Trade and Industry (METI) to set up 100
billion yen infrastructure fund that will be disbursed to Asian
countries (Yomiuri)
3) Government readying new infrastructure building program using
official development assistance (Nikkei)
4) Government revising assistance program for the northern islands
(Nikkei)
5) New treaty to cope with Asian piracy will be joined by two
European countries (Tokyo Shimbun)
6) 200 demonstrate against the arrival of the super carrier USS
Nimitz in Yokosuka (Asahi)
7) DPJ President Hatoyama says he will explain to President Obama
his party's stance on not allowing nuclear weapons into Japan
(Sankei)
8) Hatoyama stresses need for Status of Forces Agreement to be
revised (Nikkei)

Election surveys:
9) Mainichi in survey estimates that Liberal Democratic Party (LDP)
could drop from 300 seats to around 100 in upcoming Lower House
election (Mainichi)
10) Nikkei opinion survey finds the LDP's support base unraveling
(Nikkei)
11) Yomiuri poll finds that a DPJ-centered administration is most
favored by the electorate (Yomiuri)
12) Democratic Party of Japan (DPJ) analysis sees 100 districts as
being close races with the LDP (Nikkei)
13) Campaign trail: Trying to get back in the game, the LDP goes on
the attack against the DPJ in Sunday's campaign (Mainichi)
14) Hatoyama will constrain issuance of new deficit bonds (Nikkei)


(MHIX090824)

FOREIGN AND SECURITY AFFAIRS

1) Suprapartisan lawmakers plan international Afghanistan
peace-building conference in Tokyo in November

ASAHI (Page 1) (Full)
August 22, 2009

A Japanese suprapartisan parliamentary group will hold an
international conference on peacemaking in Afghanistan in Tokyo in
late November. Japan plans to demonstrate its eagerness to promote
diplomatic efforts to build peace in Afghanistan and continue
assistance for that nation. At the conference, participants will
discuss solutions to complicated problems involving religion and
terrorism in light of the current stalemate in the fight against
terrorism in Afghanistan to which the U.S. has dispatched military
troops to combat ongoing terrorism by Islamic extremists.

The conference will be jointly sponsored by the Japan committees of
the Parliamentarians for Global Action (PGA) and the World
Conference of Religions for Peace (WCRP). The sponsors expect to
bring together representatives from the Afghan government; the
United Nations; Pakistan, whose border is a breeding ground for

TOKYO 00001944 002 OF 009


armed insurgents; Saudi Arabia, which has acted as mediator in civil
wars; religious leaders from various countries; and others.

Former Finnish President Martti Ahtisaari, who won the Nobel Peace
Prize for 2008 for working to end conflicts in troubled spots around
the world, is likely to chair the conference. The sponsors are
bearing in mind the possibility of conducting a dialogue with
moderate Taliban elements in an effort to bring about peace in
Afghanistan. They expect Ahtisaari, who took the initiative in the
comprehensive peace process involving all parties concerned in 2005
in the Aceh dispute in Indonesia, to demonstrate his skills.

The list of names on the PGA Japan Committee before the dissolution
of the House of Representatives included (then) Lower House speaker
Yohei Kono, a former foreign minister of the Liberal Democratic
Party, Democratic Party of Japan (DPJ) President Yukio Hatoyama, and
others. The DPJ has looking into pursuing active diplomacy toward
peace for Afghanistan to replace the ongoing Maritime Self-Defense
Force's refueling operation in the Indian Ocean. DPJ lawmakers have
been deeply involved in preparations for the planned conference. In
the event that a DPJ government is inaugurated, the conference will
be strongly linked to its diplomatic policy.

2) Government to set up 100 billion yen infrastructure fund for
Asia

YOMIURI (Page 1) (Abridged slightly)
August 24, 2009

The Economy, Trade, and Industry Ministry has decided to set up a
government-led fund that will be invested in improvement of
infrastructure, such as railways, power, and water-supply
facilities, in other Asian countries.

Since the financial crisis and the global recession last fall, the
flow of investment funds to many Asian countries has declined. The
purpose of the Japan-led infrastructure fund is to provide funds to
countries that lack capital and the necessary support to maintain
steady economic growth. The fund also will encourage Japanese
economies to make efforts to tap the growth of other Asian
countries, now that the domestic market in Japan has started to
plateau due to the increasingly aging population and a fall in the
number of children born.

In addition to cash from domestic pension funds, life insurance
companies, other institutional investors, and government-affiliated
financial institutions, the ministry is considering bringing in
foreign funds, such as oil money from the Middle East, for the
infrastructure fund.

The ministry plans to launch the infrastructure fund in fiscal 2010
with more than 100 billion yen, and to then expand it. The ministry
is planning to set up an expert study group for the project in
September that will be tasked with promoting the fund's
realization.

Until now, Japan has mainly used public funds, such as official
development assistance, to support social overhead capital
investment in emerging and developing countries. As such, one
notable difference in the proposed infrastructure fund is that it
also makes use of funds from the private sector.


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Possible destinations of the infrastructure funds the ministry has
in its mind includes social overhead capital investments in Hanoi,
Jakarta, and the regions that stretch from Chennai to Bangalore, two
midsize cities in southern India.

If the infrastructure fund is realized, Japan will expect certain
benefits to flow from its investments, such as improved
opportunities for Japanese firms to regarding receiving orders tied
to infrastructure-linked businesses or easier access for Japanese
manufacturers and retailer chains to expand into those countries'
markets.

3) Government to inject ODA funds in less profitable works in
infrastructure projects in developing countries

NIKKEI (Page 1) (Excerpts)
August 23, 2009

The government has decided to introduce a new scheme to assist
infrastructure construction in developing countries in cooperation
with the private-sector capital by using its official development
assistance (ODA) funds. The government plans to inject yen loans in
less profitable works while having private companies invest in more
profitable parts in a large-scale project. The aim is to reduce
private firms' financial burden in pursuing more effective
assistance. By reducing risks in projects, the government will back
up private firms' advancement overseas.

After studying risk-management methods, the government will
introduce the new scheme within this fiscal year. The Foreign
Ministry has taken the view that the nation's basic principles on
aid will not change regardless of the outcome of the Aug. 30 House
of Representatives election.

The "viability gap funding" scheme - to classify a project and cover
less profitable parts with public funds - is expected to make the
project more profitable as a whole.

In an infrastructure project for physical distribution, for
instance, yen loans are used for low-margin areas, such as
expropriation of land and land readjustment, while private capital
would be invested in high-margin areas, such as road construction.

4) Government eyes review of aid to Northern Territories to shift
weight from provision of goods to human-resource training

NIKKEI (Page 2) (Full)
August 23, 2009

The government is eyeing a review of its assistance program for the
four Northern Territories starting next fiscal year. The Russian
government notified Japan early this month of its decision to no
longer receive pharmaceuticals and other goods from Japan. Following
this, the government has decided to suspend the provision of goods,
which suggests emergency aid, starting next fiscal year and instead
offer more assistance in soft areas such as human-resource training.
Based on the view that some residents on the islands are still
seeking aid from Japan, the government intends not to reduce the
scope of the aid program.

The Japanese government's assistance program is composed of three
projects: (1) provision of goods; (2) human-resource development,

TOKYO 00001944 004 OF 009


such as nurses; and (3) acceptance of patients from the islands. The
Russian government unilaterally notified the Japanese Embassy in
Moscow early this month that it will no longer receive goods.

The government has set aside about 15 million yen for the provision
of goods, but this amount will be allocated to measures to foster
human resources in the next fiscal year. It intends to keep the
current annual budget amounting to approximately 50 million yen
unchanged.

5) Norway, Netherlands to participate in Asia anti-piracy pact

TOKYO SHIMBUN (Top play) (Slightly abridged)
Evening, August 22, 2009

Norway, a Scandinavian country, will likely become a member of the
Regional Cooperation Agreement on Combating Piracy and Armed Robbery
in Asia (ReCAAP) initiated by Japan for joint anti-piracy operations
by Asian countries. Norway will be the first member state from
outside Asia. The Netherlands is also considering joining the pact,
which means the Japan-led framework that has been effective against
piracy in Asia will expand even to Europe.

ReCAAP was proposed by then Prime Minister Junichiro Koizumi in 2001
after a cargo ship with a Japanese captain on board was hijacked by
pirates in the Strait of Malacca. The agreement took effect in 2006.
Its members consist of Japan, the Southeast Asian countries, India,
South Korea, China, and others. A center for sharing information on
pirates was set up in Singapore in 2006, and 15 officials from six
countries, including officials from Japan's Ministry of Foreign
Affairs (MOFA) and Japan Coast Guard, are stationed there. This
center sends out information on piracy to the member states, which
cooperate on arresting pirates, seizing their ships, and rescuing
the victims.

Indonesia and Malaysia, which were unsuccessful in their bids to
host the center, are not yet members, but they cooperate at the
working level by providing information and pursuing pirates.

According to MOFA, Norway conveyed its interest in becoming a member
to Singapore, which serves as the secretariat, last March. The
group's rules say that membership will be rejected if there is
opposition from existing members, but so far, there has been none.
Therefore, Norway is likely to be accepted as a member before the
end of 2009, at the earliest. The Netherlands has also indicated its
desire to become a member in May 2008 and is currently in the
process of building a domestic consensus. If Norway and the
Netherlands become members, their ships navigating in the Strait of
Malacca and other Asian waters will be able to obtain information on
piracy. If these ships are attacked, coast guards and maritime
police of the member states will cooperate in rescuing the ships,
pursuing the pirates, and arresting them through a request from the
ReCAAP center.

6) Protest rally against port call by Nimitz

ASAHI Kanagawa Edition (Page 37) (Full)
August 23, 2009

Two hundred people gathered in Verny Park in Yokosuka, Kanagawa
Prefecture, to protest a call by the nuclear-powered aircraft
carrier USS Nimitz. They were members of peace groups and labor

TOKYO 00001944 005 OF 009


unions in and outside of the prefecture. After the rally they
marched near the U.S. Navy Base in Yokosuka.

The Nimitz is scheduled to call at Yokosuka Aug. 24-28 to give its
crew rest. "The nuclear-powered aircraft carrier George Washington
is not enough for the war in Afghanistan," commented Mineyuki Uno,
chairman of the Center for the Kanagawa Peace Front. "Yokosuka may
become the home port of two nuclear-powered aircraft carriers."

7) DPJ's Hatoyama will seek to persuade President Obama on issue of
not bringing nuclear arms into Japan

SANKEI (Page 5) (Abridged)
August 24, 209

Democratic Party of Japan (DPJ) President Yukio Hatoyama appeared on
Fuji TV's "New Hodo 2001" and TV programs on TV Asahi and NHK on
August 23. Discussing the three non-nuclear principles, he said that
after taking over the administration, he will meet with U.S.
President Barack Obama and seek to persuade him not have nuclear
weapons brought into Japan.

Regarding an alleged secret agreement on U.S. military vessels
carrying nuclear arms passing through Japan or calling on its ports,
Hatoyama said that he will disclose the facts to the people after
conducting an investigation in the U.S. On the issue of the U.S.
forces' Futenma Air Station, he said, "Basically, this base should
be relocated outside Okinawa, and if possible, outside Japan." He
indicated that he would like to resolve this issue through a meeting
with the U.S. President.

8) DPJ's Hatoyama says SOFA revision necessary at debate of six
party leaders on foreign and security policy

NIKKEI (Page 2) (Full)
August 22, 2009

The leaders of six ruling and opposition parties discussed foreign
and security policy during the recording for a TV Tokyo program on
August 21. Discussing Japan-U.S. relations, Democratic Party of
Japan (DPJ) President Yukio Hatoyama stressed that: "President Obama
has shifted to a policy of dialogue. This is a good time to build an
equal Japan-U.S. relationship." He also said that "basically," the
Japan-U.S. Status of Forces Agreement (SOFA) "needs to be revised."
He indicated that if the DPJ takes over the reins of government,
SOFA will be examined within a comprehensive review of the
Japan-U.S. alliance.

Commenting on the fact that Japan is protected by the U.S. nuclear
umbrella, Hatoyama said: "Considering the situation in North Korea,
this is inevitable. We are not advocating that Japan should leave
the umbrella right away."

Prime Minister Taro Aso (Liberal Democratic Party president) noted
that the DPJ has indicated that it will ask the U.S. not to use
nuclear arms for a preemptive strike and said: "It is not realistic
to ask Japan's ally, the U.S. not to use nuclear weapons first in
consideration of Japan's security." He cited North Korea's nuclear
tests and other activities and indicated his opposition to the DPJ's
proposition.

ELECTION SURVEYS

TOKYO 00001944 006 OF 009

9) Poll: DPJ likely to garner more than 320 seats, LDP may fell
below 100

MAINICHI (Top play) (Abridged)
August 22, 2009

Ahead of the upcoming 45th general election to be held Aug. 30 for
the House of Representatives, the Mainichi Shimbun conducted an ad
hoc nationwide public opinion survey from Aug. 19, the day after the
election was announced, through Aug. 21, in order to look into the
situation in campaign battles (for 480 seats, broken down into 300
seats in single-seat electoral districts and 180 seats in
proportional representation blocs). According to findings from the
survey, the Democratic Party of Japan is leading the race in most of
the nation's 300 single-seat constituencies, where the DPJ has
fielded 271 candidates. The DPJ is likely to garner a total of more
than 320 seats, including those for proportional representation.
Depending on the number of candidates elected in single-seat
constituencies, all DPJ candidates may be elected, including those
who are defeated in single-seat constitutions but elected in
proportional representation blocs. The Liberal Democratic Party,
which won a landslide victory in the 2005 general election for the
House of Representatives, is doing poorly both in single-seat
constituencies and in proportional representation blocs. The LDP is
even likely to fall below 100 seats.

In the survey this time, about 40% of respondents in the nation's
single-seat constituencies and about 20% of them in its proportional
representation blocs did not clarify their voting behavior. Given
this, the situation could become fluid.

The DPJ is gaining momentum to sweep all single-seat constituencies
of Hokkaido, Iwate, Niigata, Fukui, Yamanashi, Nagano, Aichi, Shiga,
Nara, Wakayama, and Nagasaki, looking for a chance to garner 230
seats or more. The DPJ is leading all other political parties in all
11 proportional representation blocs and is likely to secure over 90
seats.

The DPJ has indicated that it would form a coalition government with
the Social Democratic Party and the People's New Party. However, if
the DPJ wins a landslide victory with two thirds (320 seats) or more
of the seats in the Diet's lower chamber, the DPJ can take a
single-party vote second time on its bills even though they are
voted down in the House of Councillors.

10) Poll: LDP support base unraveling

NIKKEI (Page 2) (Abridged)
August 22, 2009

With the election for the House of Representatives just around the
corner, the Liberal Democratic Party's support base is becoming
shaky. Among LDP supporters, those who answered in a Nikkei poll
taken Aug. 18-20 that they would vote for the LDP accounted for no
more than 75%, with 10% saying they would vote for the Democratic
Party of Japan. Among DPJ supporters, 89% said they would vote for
the DPJ.

In the poll, the public approval rating for the Aso cabinet was 20%,
the same as in a previous spot survey taken in late July. The
disapproval rating was 62%, down 9 points. In the breakdown of

TOKYO 00001944 007 OF 009


public support for political parties, the DPJ stood at 38%, down 2
points. The LDP also dropped 1 point to 29%. Recent polls show a
similar trend of public support for the DPJ and the LDP. In the
public preference of political parties, however, the gap between the
two parties is larger than that between their support rates.

What can be seen in particular from the poll is that a certain
proportion of LDP supporters tends to vote for the DPJ. In all of
the nation's 11 proportional representation blocs, 9-11% of LDP
supporters said they would vote for the DPJ.

Meanwhile, floating voters with no particular party affiliation are
expected to have a great impact on the election's outcome. Among
them, 12% chose the LDP for proportional representation, with 25%
opting for the DPJ. The DPJ is overwhelming the LDP in the general
election more than the gap between the two parties' support ratings
shows.

11) Poll: "DPJ-led coalition" takes top position for 1st time

YOMIURI (Page 1) (Abridged)
August 22, 2009

Ahead of the upcoming general election for the House of
Representatives, the Yomiuri Shimbun conducted a telephone-based
nationwide public opinion survey on Aug. 18-20. In the survey,
respondents were asked which political party they would vote for in
their proportional representation blocs. In response to this
question, 40% answered that they would vote for the Democratic Party
of Japan, with 24% saying they would vote for the Liberal Democratic
Party. There was no marked change from the last survey taken Aug.
4-6. In the last survey, the DPJ was at 41% and the LDP at 24%.
Respondents were also asked which political party's candidate they
would vote for in their single-seat constituencies. To this
question, 38% chose the DPJ (39% in the last survey), with 25%
picking the LDP (24% in the last survey). The survey this time also
showed a similar trend.

The DPJ has been leading all other political parties in campaigning
for the general election announced Aug. 18. In the public preference
for a desirable government, "DPJ-led coalition government" accounted
for 27% (24% in the last survey), topping all other choices for the
first time. "New framework through political realignment," which
topped all other choices in the three previous surveys, was at 25%
(30% in the last survey), followed by "LDP-DPJ grand coalition" at
24% (27% in the last survey) and "LDP-led coalition" at 16% (11% in
the last survey).

The Aso cabinet's support rate was 24.7% (21.6% in the last survey),
and its nonsupport rate was 64.3% (69.0% in the last survey). In the
breakdown of public support for political parties, the DPJ stood at
33.2% (31.6% in the last survey), with the LDP at 26.9% (24.2% in
the last survey).

12) DPJ's analysis of general election: Election will be close race
in 100 single-seat districts

NIKKEI (Page 2) (Full)
August 24, 2009

Democratic Party of Japan (DPJ) President Yukio Hatoyama, Secretary
General Katsuya Okada, Deputy President Ichiro Ozawa and other party

TOKYO 00001944 008 OF 009


leaders discussed the party's election strategy for the final stage
of ongoing campaigning at party headquarters yesterday evening. They
analyzed the outcomes of opinion polls conducted by media companies,
and confirmed their policy to do everything in their power to win
the race, predicting that there are about 100 single-seat
constituencies in which its candidates and candidates on the Liberal
Democratic Party's ticket will engage in close battles.

The meeting was also attended by Deputy President Naoto Kan and
Azuma Koshiishi, chairman of the party's caucus in the House of
Councillors. After the session, Hatoyama sent emails to all DPJ
candidates titled: "Don't let yourself be deluded. Let's claim a
real victory!" In the emails, he said: "Although media polls show
that we will win 300 seats, are you confident that you will win? Be
aware of reality."

13) LDP steps up criticism against LDP to get back in the game in
general election, DPJ guards against letting advantage slip

MAINICHI (Top play) (Excerpts)
August 24, 2009

On Aug.23, with one week left until the 45th House of
Representatives election, political parties took to the streets to
campaign for support and leading politicians appeared on TV talk
shows. According to a Mainichi Shimbun poll on the predicted outcome
of the upcoming general election, the Democratic Party of Japan
(DPJ) will likely win 320 seats. Prime Minister Taro Aso (president
of the Liberal Democratic Party (LDP)) stepped up criticism of the
DPJ to overcome its inferior position in the campaign, while DPJ
President Yukio Hatoyama stressed that his party will implement its
campaign pledges (manifesto). The 40-day election campaign period --
which actually kicked off on July 21 when the Lower House was
dissolved -- has now entered its final stage.

Aso yesterday delivered speeches at four locations in Chiba
Prefecture and attended a meeting hosted by students in Tokyo. He
played up the achievements of economic stimulus by the LDP-New
Komeito coalition administration in his stumping speeches. He
criticized the DPJ's pledge to create a child-allowance system and
to make all highway tolls free. He said: "It is unacceptable to
pledge something that will bring about a pork-barrel society." He
then pointed out the inconsistency of the DPJ's foreign and security
policies, saying: "Deliberations on in the House of Councillors on
(bill on cargo inspections against North Korean ships) were dragged
out and the bill was scrapped. I think North Korea was pleased."

Hatoyama gave his speeches in five locations in Tokyo. Criticizing
the LDP-New Komeito government for its politics relying on
bureaucrats created pension and medical problems, he emphasized: "In
an attempt to lead politics to the right direction, the DPJ will
have to take over the reins of government at any cost." With media
reports that the DPJ could win by a landslide, he said: "We should
be on guard to the last," repeatedly making such remarks.

14) Hatoyama: No increase in issuance of government bonds for fiscal
2010

NIKKEI (Page 2) (Excerpts)
August 24, 2009

Democratic Party of Japan (DPJ) President Yukio Hatoyama said on a

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TV Asahi program: "We won't increase (the issuance of government
bonds). If we did, the country would fall apart," when asked whether
the issuance of government bonds in the budget for fiscal 2010 would
be increased (should his party assume the political helm). His
remarks were taken as a promise to curtail issuances of government
bonds in the budget for fiscal 2010, as well as the extra budget, to
a level less than the amount issued in fiscal 2009. The government
has already issued bonds totaling 44 trillion yen.

Asked about a resolution of the loss of millions of pension records,
Hatoyama said: "We won't be able to resolve it 100 percent." He
continued: "If receipts and evidence are required, the problem will
not be resolved. We will have to put an end to the issue by setting
certain conditions."

The DPJ includes in its manifesto a pledge to concentrate on
resolving the pension record issue for two years. He said: "We will
immediately start" checking the pension records on computer and
books. He also said: "We won't be able to take too much time for
it," stressing the need for lump-sum compensations.

ROOS

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