Cablegate: Japanese Morning Press Highlights 01/04/10

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UNCLAS SECTION 01 OF 09 TOKYO 000002

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 01/04/10

INDEX:

1) Top headlines
2) Editorials
3) Prime Minister's daily schedule (Nikkei)

Defense & Security
4) Maehara hints at dissolution of coalition if administration fails
to reach decision on Futenma by May (Akahata)
5) MOD to set up cyberspace defense force (Yomiuri)
6) "Yuai boats" to cooperate with NGOs (Nikkei)

Politics:
7) Lawmaker says he received 400 million in cash from Ozawa
(Yomiuri)
8) DPJ to move party headquarters this year (Nikkei)
9) Ordinary Diet session to start on January 18 (Yomiuri)

Foreign relations:
10) Vice Foreign Minister Yabunaka leaves for U.S. (Mainichi)
11) DPJ holds secret meetings with North Korea (Sankei)

Economy
12) Govt. doubles JAL credit to 200 billion yen (Nikkei)
13) JAL president opposed to legal liquidation of airline (Asahi)

Opinion:
14) Tokyo Shimbun poll: 62 PERCENT of companies say economy
unchanged (Tokyo Shimbun)
15) Mainichi poll: more than 50 PERCENT of companies say economy
sagging (Mainichi)
16) Tokyo Shimbun poll: 50 PERCENT would cast vote for DPJ (Tokyo
Shimbun)

17) Japan's population declines in 2009 for third consecutive year
(Yomiuri)

Articles:

1) TOP HEADLINES

Asahi:
Credit line for JAL to be doubled to 200 billion yen

Mainichi:
Majority of Japanese firms surveyed predict economy will stay at
standstill, 30 PERCENT see upturn in 2010

Yomiuri:
DPJ plans to lift ban on online election campaigning

Nikkei:
Staffing agencies shifting business models away from temporary staff
placement

Sankei:
Japan-U.S. expert panel put off

Tokyo Shimbun:
Japan might be excluded from East Asia rice stockpile framework

Akahata:

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Central government, Tokyo should cooperate to reconstruct people's
livelihoods

2) EDITORIALS

Asahi:
(1) Coexistence with Asia: Japan urged to create great cycle in
cooperation with other Asian countries

Mainichi:
(1) 2010 - year of reconstruction: Time to work on nuclear
disarmament

Yomiuri:
(1) Hatoyama diplomacy must rebuild shaky Japan-U.S. alliance

Nikkei:
(1) Rebuild pension and medical systems so that young people can
shoulder burden

Sankei:
(1) 50th anniversary of revision of U.S.-Japan Security Treaty:
Japan urged to assume risks, prevent Japan-U.S. alliance from losing
substance

Tokyo Shimbun:
(1) Fuel the storm outside COP

Akahata:
(1) 50th anniversary of revision of U.S.-Japan Security Treaty: Make
2010 year of national debate calling for abolishing the treaty

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, January 3

NIKKEI (Page 2) (Full)
January 4, 2010

Spent the whole day at his official residential quarters.

4) Okinawa Affairs Minister Maehara tells U.S. Ambassador Roos:
Dissolution of coalition over Futenma relocation, implementation of
current relocation plan possible

AKAHATA (Page 2) (Full)
January 1, 2010

Washington (Jiji) -- It was learned on Dec. 31 that State Minister
for Okinawa and Northern Territories Affairs Seiji Maehara met U.S.
Ambassador to Japan John Roos in Tokyo on Dec. 9 on the plan to
relocate the U.S. forces' Futenma Air Station (in Ginowan City,
Okinawa) and told the Ambassador that if Japan is unable to come up
with an alternative plan acceptable to the U.S. side by May, it is
prepared to pursue the existing plan to relocate the base to the
coastal area of Camp Schwab (in Henoko, Nago City), even at the
expense of dissolving the coalition government with the Social
Democratic Party (SDP) and the People's New Party (PNP). This was
revealed by a U.S. government source based on a report made to
Washington.

According to this source, Maehara explained at the meeting held at

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the Ambassador's official residence that he met Prime Minister Yukio
Hatoyama, Foreign Minister Katsuya Okada, Defense Minister Toshimi
Kitazawa, and Chief Cabinet Secretary Hirofumi Hirano on the
previous day, Dec. 8, and the five agreed that the acceptance of the
existing relocation plan was "impossible" at that point, "due to the
opposition of the SDP."

However, he said that in the process of identifying a relocation
site, efforts will be made to persuade the SDP and the PNP on: (1)
the continuation of the environmental impact assessment in the
coastal area of Camp Schwab; (2) earmarking expenditures relating to
relocation to Camp Schwab in the reserve funds under the FY2010
budget; (3) drawing up an alternative proposal acceptable both to
Okinawa and the U.S.; and (4) accepting the existing relocation plan
if no such proposal can be worked out.

In addition, Maehara said that if an agreement is not reached with
the U.S. on the alternative plan, "the dissolution of the coalition
is possible" around May after the Golden Week holidays (in early
May), when the budget and the related bills will have been enacted,
if the SDP and PNP oppose the current relocation plan. He reportedly
indicated that Japan will accept the existing relocation plan in the
end.

In response to an inquiry from Jiji Press, Maehara stated that he
"did not say anything to that effect."

5) Defense Ministry to create new cyberspace defense unit to
strengthen countermeasures against hackers

YOMIURI (Page 2) (Full)
January 1, 2010

The Ministry of Defense (MOD) has decided to create a specialist
"cyberspace defense unit" in FY2010 to strengthen the protection of
the confidentiality of information against attacks by viruses and
other methods. In light of frequent invasion of government computer
networks by hackers in the U.S., South Korea, and other countries,
this "defense unit" will be responsible for unified collection,
analysis, and research of the latest information on viruses and for
conducting training on dealing with these viruses.

The MOD is allocating some 7 billion yen for dealing with cyber
attacks in its FY10 budget. It will set up a preparatory office led
by a "cyber planning and coordination officer" to promote the
training of team members with specialized knowledge. This "defense
unit" is envisioned to have about 60 members and will report to the
Self-Defense Forces (SDF) Command Control Communication Computers
(C4) System Department.

The U.S. and South Korean government websites suffered intensive
cyber attacks in July 2009, resulting in damages such as disruption
of connectivity. The MOD and the SDF have also been receiving an
increasing number of e-mails containing viruses, causing a
heightened sense of alarm.

6) "Yuai boat" to cooperate with NGOs

NIKKEI SHIMBUN (Page 2) (Full)
January 4, 2010

The outline of the "yuai (fraternity) boat," concept, which calls

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for Maritime Self-Defense (MSDF) ships to visit disaster sites to
provide medical aid, has been disclosed. The MSDF transport ship
"Oosumi" (8,000 tons) will be used for the mission in cooperation
with NGOs. The ship is scheduled to begin humanitarian relief in
Southeast Asia after participating in training in the United States.

Prime Minister Hatoyama laid out the "yuai boat" concept in a speech
in Singapore on Asian policy. The government is considering the
ship's participation in the "Pacific Partnership," a U.S.-led
humanitarian mission in Southeast Asia. Other participants in the
partnership include Canada and Australia. Japan dispatches several
medical doctors to the program every year.

The Japanese government envisions using in the mission MSDF ships of
the "Oosumi' class, which are fully equipped to transport medical
equipment and highly capable of transporting personnel. The
government will soon start to recruit civilians and NGOs for
participation in the initiative.

7) Ishikawa: "I received 400 million yen from Ozawa" after
consulting him on lack of money to purchase land

YOMIURI (Top Play) (Lead paragraph)
January 1, 2010

Rikuzan-kai, the political fund management organization of
Democratic Party of Japan (DPJ) Secretary General Ichiro Ozawa,
failed to report the money it used to purchase land in Tokyo in
2004. In questioning over this case by the special investigation
unit of the Tokyo District Public Prosecutors Office, DPJ lawmaker
Tomohiro Ishikawa, who was in charge of administrative work at the
organization, said that he had received 400 million yen in cash from
Ozawa after consulting him on fund management matters, according to
informed sources. Furthermore, Ishikawa received another 400 million
yen and credited it to the organization's bank account in 2005, but
that money was not reported either. The special investigation unit
suspects that he received this money from Ozawa as well.

8) DPJ to move its headquarters to building near Lower House Diet
Members' Building

NIKKEI (Page 2) (Full)
January 1, 2010

It was learned on Dec. 31 that the Democratic Party of Japan (DPJ)
plans to move its headquarters, now in Nagatacho, Tokyo, as early as
before the end of 2010. This is because the party outgrew its
present headquarters after the number of DPJ lawmakers doubled to
more than 400 since the party's landslide victory in last summer's
House of Representatives election. The DPJ is considering moving its
headquarters into a building now under construction near the Lower
House Diet Members' Building.

The DPJ now rents the fourth to eighth floors and the 10th floor of
a 10-story building located one minute from the Diet building. Other
floors of the building are leased by a camera company and other
firms. DPJ members have complained that parking lots and elevators
are cramped and that it is difficult to check suspicious persons.

9) Regular Diet session to be convened on Jan. 18; Upper House
election most likely to be held on July 11

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YOMIURI (Page 1) (Full)
January 3, 2010

The government and ruling parties decided on Jan. 2 to convene a
regular Diet session on Jan. 18, according to several senior
Democratic Party of Japan (DPJ) members. The session will run for
150 days until June 16. If the term of the session is not extended
and if the House of Councillors election in the summer is held on a
Sunday based on the regulations set in the Public Offices Election
Law, the official campaign for the Upper House election will start
on June 24 and the election will be held on July 11. The ruling
coalition will hold a meeting of the Diet affairs committee chiefs
from the ruling and opposition parties on Jan. 6 and propose the
convocation of the regular session on Jan. 18.

The government and ruling parties aim to start deliberations on a
second supplementary budget bill for fiscal 2009, including a
package of emergency economic stimulus measures, and to enact the
bill before the end of the month.

10) Administrative Vice Foreign Minister Yabunaka to leave for U.S.
today

MAINICHI (Page 2) (Full)
January 4, 2010

The Ministry of Foreign Affairs announced Jan. 3 that Administrative
Vice Minister Mitoji Yabunaka will visit the United States on Jan.
4-6. He will hold talks with Deputy Secretary of State James B.
Steinberg on the afternoon of Jan. 5 (local time) about such pending
bilateral issues as the relocation of the U.S. Marine Corps' Futenma
Air Station (in Nago City, Okinawa Prefecture).

The government intends to make a decision on the Futenma relocation
issue by May. It began looking into a new relocation site since late
last year with the Social Democratic Party (SDP) and People's New
Party (PNP), while leaving the existing plan to move the Futenma
base to the coastal area of Camp Schwab (in Nago City) open as an
option. However, since the U.S. government, which has insisted that
the existing plan is the best and only viable option, has grown
increasingly distrustful of the Japanese side, Yabunaka will
apparently explain the circumstances in Japan once again.

11) DPJ in secret contact with North Korea on abduction issue
through several channels since last summer

SANKEI (Top play) (Abridged)
January 3, 2010

It was learned on Jan. 2 that since last summer, several Democratic
Party of Japan (DPJ) officials have engaged in top secret meetings
with North Korea in China on several occasions on the issue of the
DPRK's abduction of Japanese nationals, asking North Korea to
investigate the whereabouts of the victims. This is the first time
that the Hatoyama administration's contact with North Korea has been
revealed. The North Koreans reportedly told DPJ officials that it is
possible that some of the abductees are still alive. It is now
possible that official talks between Japan and North Korea may
resume before the House of Councillors election this summer,
depending on the North Korean side's response.

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According to a number of sources related to the government and the
ruling parties, the secret meetings started last summer, before the
change of administration took place, and gained momentum after the
Hatoyama cabinet was launched.

One of the channels of secret contact involves an official close to
Secretary General Ichiro Ozawa, and he has been visiting the North
Korean embassy in Beijing about once a month. Another channel
involves a different DPJ official who visited China in mid-October
on orders from the Prime Minister's Official Residence. On this
occasion, "he exchanged views on the various pending issues between
the two countries with a senior North Korean official in the
presence of an intermediary" (according to a source on Japan-DPRK
relations).

Through these secret contacts, the DPJ reiterated its demand for a
re-investigation into the whereabouts of the abductees. The North
Korean side allegedly responded that "some" of the abductees are "in
poor health" but did not give any information on their names and
identities.

According to the source on Japan-DPRK relations, it appears that a
close confidant of General Secretary Kim Jong Il, Workers Party of
Korea United Front Department Director Kim Yang Kon, who is the
working level official in charge of policy toward South Korea, has
been involved with the secret meetings. A senior Japanese Ministry
of Foreign Affairs official observes that, "While the information on
surviving abductees cannot be verified, North Korea is probably
trying to probe the DPJ administration's thinking."

12) DBJ to double its credit line for JAL to 200 billion yen

NIKKEI (Page 1) (Excerpt)
January 4, 2010

Deputy Prime Minister Naoto Kan and Transport Minister Seiji Maehara
on Jan. 3 discussed the rebuilding of Japan Airlines (JAL) and
agreed to boost the state-owned Development Bank of Japan's (DBJ)
credit line for the cash-strapped air carrier from the current 100
billion yen to 200 billion yen. This is aimed at supporting the
carrier's cash flow until the Enterprise Turnaround Initiative
Corporation of Japan (ETIC) decides to comply with JAL's request for
financial assistance. Attention will be focused on the movements of
JAL stocks on the Tokyo Stock Exchange, which will reopen on the
4th.

13) JAL president opposes legal liquidation: Eyes switching airline
groups

ASAHI SHIMBUN (Top play) (Lead para.)
January 3, 2010

Japan Airlines has asked for financial assistance from the
Enterprise Turnaround Initiative Corporation of Japan (ETIC), a
public-private fund. The fund sees bankruptcy filing as the most
viable option available to the cash-strapped air carrier. Responding
to an interview by the Asahi Shimbun, JAL President Haruka Nishimura
revealed his stance of opposing the idea. He indicated his view that
considering strategies for Asia, where future growth can be
expected, it would be advantageous for JAL to switch airline groups.
He said Delta Air Lines would be more desirable as the company's
U.S. business partner than American Airlines. He also stressed that

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he has no intention of having the company pull out of international
flight operations.

14) Survey of 206 leading companies: 62 percent reply, "The economy
will remain unchanged"

TOKYO SHIMBUN (Page 1) (Excerpts)
January 4, 2010

The Tokyo Shimbun on Jan. 3 compiled results of a survey of 206
leading companies throughout the nation on business conditions
(conducted from mid-December through late-December). Regarding the
present state of the Japanese economy, 62.4 percent of pollees
replied that the economy is leveling off, indicating that many
companies sense the economy is stagnating. Asked their outlook for
fiscal 2010, while 49.3 percent think the economy will gradually
improve, 40.5 percent said that the economy will level off,
revealing they believe that it will be difficult for Japan to climb
out of the harsh economic situation due to sluggish personal
consumption, the strong yen, and concern about deflation.

Asked about the Hatoyama administration, 44.4 percent of respondents
were undecided, followed by 23.9 percent who were "dissatisfied" and
10.2 percent who answered "so far so good." No respondents replied
"very good."

15) Mainichi poll of 119 companies: Majority of surveyed companies
see economy at standstill: 30 percent project business turnaround

MAINICHI (Top play) (Excerpts)
January 4, 2010

The Mainichi Shimbun late last year carried out an opinion poll of
economic trends on 119 leading companies throughout the nation. Only
35, or 29.4 percent, of the companies polled replied that the
economy will improve. Sixty-seven companies, or 56.3 percent,
replied that the economy will remain at a standstill. The survey
results indicate that although the Japanese economy has climbed out
of its worst phase right after the Lehman shock in the fall of 2008,
an increasing number of companies predict that the economy will
enter a temporary lull due to sluggish domestic demand, the
deflationary trend, and the continuing strong yen. Sixteen companies
or 13.4 percent of pollees replied that the economy would slip
further. A sense of wariness about the economy suffering a second
dip due to the economic slump and deterioration is heightening.

The presidents and chairmen of 119 leading companies were surveyed
for the poll conducted on from early December through mid-December.

Regarding the present state of the economy, 76 companies (63.9
percent of respondents) said, "The economy is leveling off." The
number of companies that replied that the economy is gradually
declining or has declined totaled 13 (10.9 percent). Only 30
companies (25.2 percent) said that the economy is gradually picking
up.

In the survey, the 35 companies that projected the economy will turn
around were also asked when they think the economy will achieve a
full-scale recovery. Approximately 60 percent gave the answer, "in
the second half of fiscal 2010." Twenty percent replied, "after
fiscal 2011." Respondents in the poll this time projected a
full-fledged economic turnaround later than the first half of fiscal

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2010 - the timeframe given by the largest number of companies
surveyed in the poll carried out last July.

16) Poll: 50 PERCENT say they would vote for DPJ in Upper House
election

TOKYO SHIMBUN (Page 3) (Excerpts)
January 3, 2010

In a nationwide face-to-face opinion survey on Dec. 5-6 by Public
Opinion Research on the House of Councillors election this summer,
50 PERCENT said that they would vote for the Democratic Party of
Japan (DPJ) if the election were held now. Those who picked the
Liberal Democratic Party (LDP) accounted for only 21 PERCENT . Since
the survey was conducted about one month ago, the survey does not
necessarily reflect the current will of the public. The survey,
however, showed that the voters were still placing high expectations
on the DPJ, which won an overwhelming victory in the House of
Representatives election last year.

Regarding the desirable form of a new government, 32 PERCENT opted
for a DPJ single-party administration, while 28 PERCENT each opted
for a three-party coalition, as there is now, and a DPJ-LDP grand
coalition. The survey thus showed that the voters were relatively
cautious about a DPJ single-party administration. Asked about the
campaign pledges the DPJ made in the last Lower House election (with
multiple responses allowed), the survey demonstrated the
unpopularity of the plan to waive express tolls, with 61 PERCENT
disapproving of it.

Asked about which policies should be carried out on a priority basis
(with multiple responses allowed), 51 PERCENT picked the total ban
on agencies arranging post-retirement jobs for senior bureaucrats or
making such arrangements multiple times for retired officials, and
42 PERCENT opted for the elimination of wasteful spending, for
example, for public works projects, by the government. The public's
severe view of bureaucrats and governance stood out in bold relief.

In terms of interest in the Upper House election, a total of 82
PERCENT said they were greatly or somewhat interested in the
election, while a total 17 PERCENT replied they were not greatly
interested or not interested at all in the election.

Regarding the expected points at issue in the election, with
multiple responses allowed, 68 PERCENT chose "the economy,
employment and social disparity"; 54 PERCENT "pension, medical
care, nursing care, and welfare"; 20 PERCENT "tax and fiscal
reforms"; and 14 PERCENT "the framework of the government."

17) Japan's population declines in 2009 for third consecutive year

YOMIURI (Page 2) (Slightly abridged)
January 1, 2010

Japan's population dropped by 75,000 in 2009, recording the third
consecutive annual decline, according to the Health, Labor and
Welfare Ministry's annual population estimate. The population fell
at the largest scale and at the fastest rate since the end of World
War II.

The pace of decrease accelerated in 2009 as the 1.144 million deaths
(an increase of 20,000 over 2008) outpaced the 1.069 million births

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(a decrease of 22,000). The population decline grew by 24,000 from
that of the previous year.

The population decreased in 2005 for the first time since the World
War II. Although the population increased in 2006, it has fallen
every year since 2007.

The total fertility rate, the average number of children expected to
be born to each woman during her lifetime, is estimated to be about
the same as last year's figure of 1.37. The ministry expects the
rate of population decline to increase in the future.

ROOS

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