JAPANESE MORNING PRESS HIGHLIGHTS 05/16/06

UNCLAS SECTION 01 OF 10 TOKYO 002672

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 05/16/06

Index:

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

Opinion polls:
4) Kyodo poll: Gap narrowing between top Koizumi contenders,
with Abe at 40% popularity rating, and Fukuda gaining with 31%
5) Yomiuri poll: Abe still on top with 40% as public favorite
to succeed Koizumi, but Fukuda rapidly rises to 23%
6) Only 17% see Basic Education Law passing this Diet session
in Asahi poll, with public split over use of patriotic wording in
the text
7) Nikkei poll: 28% find it unavoidable that Japan must pay
part of the USFJ realignment costs, but 40% would exclude Guam
relocation portion
8) Okinawa poll: 46% against the Nukaga-Inamine agreement on
Futenma relocation, with many angry at Okinawa governor

Defense issues:
9) In deference to Okinawa, government not clearly stipulating
V-shaped runway at Camp Schwab in alignment document set for
Cabinet approval
10) ASDF may transport UN personnel, goods in Iraq as
reconstruction assistance
11) China interfered in scheduled charter flight carrying GSDF
troops to Samawah, forcing equipment change

12) Prime Minister Koizumi denies press rumors of his making
another trip to Pyongyang

Koizumi reforms:
13) Government's measures to counter low birthrate focus on
changes in the work place, assistance to local districts
14) USG criticizes NTT in public comment for "Impeding
competition"
15) Government readying program to encourage inward investment
into Japan

16) Minshuto head Ozawa embarks on nationwide stumping tour
already preparing for next year's Upper House race

Articles:

1) TOP HEADLINES

Asahi:
Measures on low birth rate: Government panel to map out package
with focus on work styles and local assistance

Mainichi: Yomiuri: Sankei: Tokyo Shimbun:
Roster for Japanese World Cup team selected

Nihon Keizai:
Honda Motors to construct new plant with annual production
capacity of 150,000 units in North America to meet demand for
fuel-efficient vehicles

2) EDITORIALS

Asahi:

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(1) Drugs: Cut off North Korean route
(2) Chinese yuan: Revaluation will provide springboard for
development

Mainichi:
(1) Changing sponsorship of shogi tournament: Make a fresh start
(2) Measures on low birth rate: Ideas and money should not be
spared

Yomiuri:
(1) DPJ's counterproposal on bill amending Basic Education Law:
The opposition party should find common ground with government
stance
(2) Police fabricate report in Setagaya murder case: Culprit
won't be caught this way

Nihon Keizai:
(1) Child-rearing assistance measures lack feasibility and
funding
(2) 2006 World Cup in Germany: Opportunity to make friends

Sankei:
(1) Basic Education Law: DPJ plan not so bad
(2) 2006 World Cup: We want to see exciting games again

Tokyo Shimbun:
(1) 2006 World Cup in Germany: We want to see improved play by
Japanese team
(2) Fake police investigation report on Setagaya murder case:
Police should go back to basics of investigation

3) Prime Minister's schedule, May 15

NIHON KEIZAI (Page 2) (Full)
May 16, 2006

10:31
Arrived at Kantei.

11:30
Met Health, Labor, and Welfare Ministry's Health and Labor Bureau
Deputy Director General Tsuji, Policy Planning Director General
Shiota, and others.

15:00
Met Foreign Ministry's Middle Eastern and African Affairs Bureau
Director General Yoshikawa, and former Samawah Office head
Kobayashi.

16:30
Met Nihon Keizai Shimbun President Sugita.

17:01
Attended an executive meeting in the Diet building.

17:38
Arrived at Kantei.

19:00
Met Upper House Diet Affairs Committee Chairman Yano, Deputy
Chief Cabinet Secretary Suzuki, and others.


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4) Poll: Abe stands at 40%, Fukuda at 31% in post-Koizumi race

TOKYO SHIMBUN (Page 1) (Abridged)
May 16, 2006

Kyodo News conducted a telephone-based nationwide public opinion
survey on May 13-14, in which respondents were asked who they
thought would be appropriate for the next prime minister after
Prime Minister Junichiro Koizumi. In this popularity rating,
Chief Cabinet Secretary Shinzo Abe ranked at the top with 40.1%
(51.9% in a previous survey conducted in April). However, one of
Abe's predecessors, Yasuo Fukuda, rose to 31.4% in the latest
survey from 22.1% in the last survey. Fukuda closed in on Abe
with their margin narrowed down from 29.8 percentage points in
the last survey to some 20 points in the survey this time. The
ruling Liberal Democratic Party is scheduled to elect its new
president in September, and Yasukuni Shrine is likely to become a
point of contention in the LDP presidential race. In the survey,
respondents were asked if they thought the next prime minister
should visit the shrine. In response to this question, "no"
accounted for 51.8%, with "yes" reaching 35.8%. As seen from the
figures, negative answers outnumbered positive ones.

Fukuda is willing to redo Koizumi diplomacy in an aim to improve
Japan's soured relations with China and South Korea. In the
survey, his remarks seem to have given a favorable impression to
the public and led to an increase in public support for him.
Among other post-Koizumi candidates, Foreign Minister Taro Aso
stood at 4.5%, Finance Minister Sadakazu Tanigaki at 2.7%, and
Taro Kono at 1.6%. "Others" accounted for 1.4%.

In the survey, respondents were also asked what the next prime
minister should do about Koizumi's restructuring drive. In
response to this question, 30.1% said the next prime minister
should take over the Koizumi reforms, with 30.6% insisting on
revising and 32.3% insisting on overhauling. The Koizumi
cabinet's approval rating was 49.6%, up 2.4 points from the last
time, and its disapproval rating at 37.6%, down 2.3 points.

In the breakdown of public support for political parties, the
leading opposition Democratic Party of Japan (DPJ or Minshuto)
stood at 24.2%, up from the 19.9% rating in the last survey
conducted right after Ichiro Ozawa became the party's head. The
DPJ has now recovered its popularity to the level in March 2005,
overcoming its email fiasco. The LDP was at 39.0%, down 4.4% from
the last time, and the New Komeito party, a coalition partner of
the LDP, was at 3.8%, up 0.8 points. Among other parties, the
Japanese Communist Party was at 1.9%, down 0.7 points; the Social
Democratic Party (SDP or Shaminto) at 1.9%, up 0.4 points; the
People's New Party (PNP or Kokumin Shinto) at 0.1%, down 0.2
points; the New Party Nippon (NPN or Shinto Nippon) at 0.2%, up
0.1 points. Those with no particular party affiliation accounted
for 27.2%, down 0.1 points.

In the survey, respondents were further asked which political
party they would like to vote for in the House of Councillors
election slated for the summer of next year. In response to this
question, 37.1% picked the LDP, with 28.9% preferring the DPJ.

5) Poll: Fukuda surges to 23% in post-Koizumi race, Abe still in
top position with 40%


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YOMIURI (Page 2) (Abridged)
May 16, 2006

The Yomiuri Shimbun conducted a face-to-face nationwide public
opinion survey on May 13-14, in which respondents were asked to
pick one from among nine persons in the ruling Liberal Democratic
Party as the most appropriate person for the next prime minister
after Prime Minister Koizumi, who will step down in September. In
this popularity ranking, Chief Cabinet Secretary Shinzo Abe still
topped all others at 40%, and one of his predecessors, Yasuo
Fukuda, ranked second at 23%. Abe was down 4 percentage points
from a survey conducted in April. In the meantime, Fukuda was up
10 points, rising sharply in public support. Their margin has
narrowed down from 31 points in this April's survey to 17 points
in the latest survey. Many more people are apparently looking
ahead into the LDP presidential race in the Abe-vs.-Fukuda
showdown.

Among other post-Koizumi candidates, Foreign Minister Aso stood
at 4%, down 1 point from last month; former LDP Secretary General
Koichi Kato at 3%, up 1 point; Internal Affairs and
Communications Minister Takenaka at 2%, down 1 point; Finance
Minister Tanigaki at 1%, leveling off from last month.

In the breakdown of public support for political parties, the LDP
stood at 42.3%, showing a slight decrease of 0.5 points from last
month. The leading opposition Democratic Party of Japan (DPJ or
Minshuto) was at 15.8%, up 1.8 points. The DPJ has topped 15% for
the first time in one and a half years since a survey conducted
in November 2004.

The Koizumi cabinet's approval rating was 54.4%, showing a slight
decrease of 1.6 points from the last survey.

6) Poll: 17% want education law amended in current Diet session

MAINICHI (Page 2) (Abridged)
May 16, 2006

In a recent telephone-based poll conducted by the Mainichi
Shimbun on May 13-14, respondents were asked if they thought the
Diet should pass a government-introduced bill now before the Diet
to amend the Basic Education Law in the current session. In
response to this question, "yes" answers accounted for only 17%,
with "no" reaching 66%. As seen from these figures, the general
public apparently does not think the Diet should fast-track the
bill, though how to handle this legislative measure will likely
affect whether to extend the current Diet session. Among other
answers, 7% insisted that the Diet should vote down the bill in
the current session and scrap it.

The government bill also incorporates patriotism, which is
expressed as "respecting Japan's traditions and culture and
loving Japan and its land." In the survey, respondents were asked
about this wording. In response to this question, 40% said it was
fine. However, 26% insisted on even more clear-cut wording, with
25% saying there is no need to incorporate patriotism in the law.
As seen from these figures, critical views totaled about 50%.

7) Poll: 28% see Japan's payment for USFJ realignment as
unavoidable


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NIHON KEIZAI (Page 2) (Full)
May 16, 2006

Japan and the United States released a final report on May 2,
incorporating an agreement on the realignment of US forces.
Meanwhile, the Nihon Keizai Shimbun conducted a public opinion
survey on May 12-14, asking respondents if they thought it
unavoidable for Japan to pay for the US military's realignment in
Japan. In response to this question, 28% answered "yes." However,
40% were cautious about paying for the relocation of US Marines
from Okinawa to Guam, insisting that Japan's payment for the
force realignment should be limited to base relocation in Japan
only. Negative answers about Japan's cost sharing for the
realignment accounted for 19%.

Japan planned to carry out a survey of the sea near the disputed
group of Takeshima islets (Dokdo in Korean),to which Japan and
South Korea have been claiming territorial rights. Asked about
South Korea's backlash against the planned survey, 50% said Japan
should forego the sea survey for the time being and see South
Korea's attitude, with 31% insisting that Japan should carry it
out right away even though it may worsen the two countries'
relation and only 3% saying Japan should never ever carry it out.

8) Poll of Okinawa residents: 46% don't approve of agreement on
Futenma relocation plan

ASAHI (Page 1) (Full)
May 16, 2006

Only 30% of respondents expect that the planned realignment of US
forces in Japan based on the agreement between the Japanese and
US governments would lighten the base burden on Okinawa, while
66% did not have such an expectation, according to a joint survey
of Okinawa voters on May 13-14. Asked about the recent agreement
reached between Okinawa Governor Keiichi Inamine and Defense
Agency Director General Nukaga on the government's plan to
relocate the US Marine Corps' Futenma Air Station to Cape Henoko
in Nago, 46% said: "I don't approve it," overtaking those who
said: "I approve it."

According to the telephone survey, conducted jointly by the Asahi
Shimbun and the Okinawa Times, 6% said: "The security burden on
Okinawa will be significantly reduced" through the US force
realignment, and 24% replied: "It will reduce it to some extent."
But 47% said: "The burden will not be significantly lightened,"
and 19% said: "It will not be lightened at all." The poll showed
that many are not expecting the realignment to lighten the base
burden on Okinawa.

On the entire picture of realignment of US forces in Japan, as
well, 55% expressed "opposition," while only 27% expressed
"support."

Asked about the government's Futenma relocation plan, 69% gave a
negative view, whereas 19% were positive. These figures are
almost the same as those in the survey (72% against it, 15% in
favor) conducted just after the interim report on US force
realignment was announced last November.

Although public support for Governor Inamine dropped to 58% from
the 64% last November, many still support the governor. Asked

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about his agreement with Nukaga on the government's Futenma
relocation plan, however, only 36% expressed "approval."

9) Futenma relocation: Government not to specify V-shaped plan in
cabinet decision out of consideration for local communities

MAINICHI (Page 2) (Full)
May 16, 2006

The government decided yesterday not to specify the Japan-US
agreement on V-shaped 1,800-meter-long runways to replace the one
at Futenma Air Station in the document to be adopted by the
cabinet for implementation of US force realignment. The decision
reflects the government's consideration to the Okinawa
prefectural government, which is calling for a temporary
heliport, and the Nago municipal government, which is insisting
on shorter runways. The document is likely to use ambiguous
expressions, such as "based on the government's plan." But the
government has no intention of revising the V-shaped plan,
specified in the final agreement with Washington. The decision,
therefore, is aimed at facilitating talks with municipalities for
realizing the plan.

A cabinet decision will formerly determine the government's
policy to take necessary measures to implement the final report.
The government has been making arrangements for making a cabinet
decision on May 23 ahead of the Pacific Islands Summit to be held
on May 26-27 in Okinawa in the attendance of Prime Minister
Junichiro Koizumi. After a cabinet decision, the government plans
to set up a consultative panel with Okinawa and Nago and
accelerate coordination in the government to establish
legislation for facilitating US force realignment.

The governments of Japan and the United States are in accord to
relocate Futenma Air Station to the coastline of Camp Schwab in
Nago. Their final agreement incorporated a plan to build two
1,800-meter runways including 100-meter overruns in a V shape as
alternative facilities. An absence of the V-shaped plan from a
cabinet decision may draw fire from the US calling for the
implementation of the relocation plan without fail.

10) Government considering expanding ASDF Iraq mission to include
airlifting of UN personnel, supplies

YOMIURI (Page 1) (Excerpts)
May 16, 2006

The government is considering expanding the Air-Self Defense
Force's mission to include the airlifting of United Nations
personnel and supplies from Kuwait to Baghdad in accordance with
the Law Concerning Special Measures on Humanitarian and
Reconstruction Assistance in Iraq. The government is considering
such a step in compliance with an informal request of the world
body, which is aiming to expand activities in Iraq. UN Secretary
General Kofi Annan is expected to ask for Japan's cooperation in
transport in his talks with Prime Minister Koizumi tomorrow. If
there is such a request, Koizumi is likely to express his
willingness to consider it positively.

The United Nations substantially reduced its activities in Iraq
following the August 2003 bombing of its headquarters in Baghdad.
Currently, some 660 personnel with the United Nations Assistance

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Mission for Iraq (UNAMI) are operating in the country. The world
body, which plans to beef up the functions of its Iraq office and
expand its activities timed with the establishment of a new Iraqi
government, has informally asked a number of countries, including
Japan, to assist in airlifting UN personnel and supplies.

11) Japan's chartered plane transporting GSDF troops to Iraq
unable to fly due to China's pressure

SANKEI (Page 3) (Excerpts)
May 16, 2006

Japan's 10th detachment from the Ground Self-Defense Force (GSDF)
yesterday arrived in Samawah in southern Iraq for reconstruction
assistance, but this unit had been forced to reschedule their
departure due to China's pressure, several high-level government
officials revealed yesterday. Specifically, Chinese authorities
raised a red flag toward a flight plan by a commercial plane
chartered by the Japanese government to send GSDF troops to Iraq.
Reconstruction assistance to Iraq is part of Japan's
international contributions and is a major pillar of its foreign
policy. The government, being unable to fathom Chinese
authorities' intentions, plans to review the previous way of
dispatching personnel abroad for international contributions.

According to government officials, the 10th detachment had
initially planned to depart from Haneda Airport on May 7.
Following the plan, it had chartered a plane from the Hong Kong-
based Cathay Pacific Airways to fly to Kuwait, a transit point
for Iraq.

However, the moment Chinese authorities learned of this flight
plan, they called on the airline company to cancel the flight
plan. Coming under Chinese pressure, Cathay Pacific reportedly on
May 5 informed the Defense Agency (JDA) via a Japanese
intermediate agent of a last-minute cancellation of the flight
plan.

The JDA hastily rearranged the dispatch plan and sent the GSDF
unit by using two regular flights, such as that of Qatar Airways,
which departed from Kansai International Airport late at night on
May 7. The unit of 140 troops was divided into two groups to get
on two planes: one consisting of 25 troops and the other of 115.
They got into the planes in plain clothes, although under the
initial plan, they would have boarded in uniform. They arrived in
Iraq via Qatar.

12) Former diplomat doubtful about Prime Minister Koizumi's third
visit to North Korea

SANKEI (Page 5) (Full)
May 16, 2006

Former Deputy Foreign Minister Hitoshi Tanaka, who behind the
scenes orchestrated the first visit to North Korea by Prime
Minister Junichiro Koizumi, yesterday delivered a speech in Tokyo
in which he expressed doubt that the prime minister would make a
third visit to North Korea before he steps down in September,
saying: "(The prime minister) will not go unless elaborate
preparations are made and certain achievements are expected."

13) Government council on declining birthrate to consider work

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styles and local support, puts discussion of funding on the
backburner; Will hammer out differences between two proposals
floated by ruling coalition

ASAHI (Top play) (Lead paragraph)
May 16, 2006

The government's Council on Measures for the Declining Birthrate,
chaired by Chief Cabinet Secretary Abe, yesterday shaped a
package of measures to be adopted in June. The focus of the
package is plans for economic support like improving child-care
allowances, a review of work styles that includes corporate
subsidies child-care leave, and the establishment of a child-
rearing support system in each region, such as establishing a
system of "child-rearing managers" (tentative name). But when it
comes to financial resources for such plans, the Council cited
only the need to establish "child-care insurance" and "a child-
care fund." Based on this package, as well as proposals to deal
with the declining birthrate the ruling Liberal Democratic Party
(LDP) and its junior coalition member New Komeito presented late
April, the government will now begin final coordination regarding
items for measures to be incorporated into the government's Basic
Policies for Economic and Fiscal Management and Structural
Reform, which will be approved at a cabinet meeting in June.

14) NTT under fire from domestic competitors, US government;
Communications Ministry releases publicly solicited views;
Strengthening of group ties criticized as hindering competition

MAINICH (Page 9) (Full)
May 16, 2006

The Ministry of Internal Affairs and Communications (MIC)
yesterday released the results of views solicited from the public
regarding Japan's new competition policy for telecommunications.
The US government and KDDI and other domestic companies expressed
strong concern that NTT's strategy of strengthening ties with its
group companies, such as NTT East, NTT West, and DoCoMo, which it
released last fall, would mar the competitive environment in the
telecommunications sector. They all called for the strengthening
of regulations to restrict consolidated business management by
the telecom giant and the introduction of a radical competition
policy that would break up the monopoly.

The US government pointed out that the reorganization of NTT
Group under a holding company in 1999 has not been effective in
terms of promoting competition. NTT in its mid-term management
strategy issued last November unveiled a policy of integrated
management of group companies. The US government also harshly
criticized that policy as undermining the competitive
environment.

An interim report issued by the Panel to Consider
Telecommunications and Broadcasting (chaired by Toyo University
Professor Satoshi Matsubara),a private council that reports to
MIC Minister Heizo Takenaka, incorporated a plan to spin off
NTT's fixed-line service into a separate entity and not allow the
new entity to use the NTT brand. The US government praised the
report, noting, "The US is paying attention to the development of
the proposal with interest."

Domestic competitors, such as KDDI and Softbank, have expressed

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concern about a plan for NTT East, NTT West, and DoCoMo to offer
services integrating fixed lines and mobile phones, saying that
tie-ups between dominant players stifle competition. NTT has
countered such criticism, claiming that in developing next-
generation telecommunications services, it will open the door to
other carriers. Howls of criticism from the US and domestic
competitors will likely affect the mapping out of a new
competition policy by the MIAC.

15) Government drafts proposals to encourage investment in Japan

NIHON KEIZAI (Page 5) (Full)
May 16, 2006

The government's Inward Investment Council, chaired by Prime
Minister Junichiro Koizumi, presented during its expert panel
meeting yesterday a set of proposals to expand investment in
Japan from overseas.

The proposals were included in an Inward Investment Acceleration
Program (tentative name) it submitted to the meeting yesterday.
This program is composed of three parts: (1) strengthening the
exploitation of and assistance to inward investment projects; (2)
arranging an environment to facilitate investment in Japan; and
(3) promoting PR. The panel plans to adopt specific measures by
mid-June and incorporate them in the government's 2006 Basic
Policies for Economic and Fiscal Management.

Included in the program are measures to hold investment seminars
joined by relevant cabinet ministers and governors and to set up
a website on inward investment that posts information related to
investments across the nation, such as industrial integration and
R&D (research and development). In addition, the panel will study
measures to (1) establish employment, education, and medical
systems for investing companies; (2) prepare foreign-language
brochures about administrative procedures for investment in Japan
and digitize them; and (3) give special aid for regions eager to
draw in investment.

16) Ozawa kicks off nationwide tour for Upper House election
beginning with Yamagata

YOMIURI (Page 4) (Full)
May 16, 2006

Minshuto (Democratic Party of Japan) President Ichiro Ozawa
visited Yamagata City yesterday to exchange views with
prefectural chapter executives for the 2007 Upper House election.
Ozawa, who places importance on single-seat constituencies,
picked Yamagata as the first leg of his nationwide stumping tour
for the upcoming election. In his talks with persons connected
with influential local groups, such as Yamagata Keizai Doyukai
(Association of Corporate Executives) and Rengo (Japanese Trade
Union Confederation) Yamagata, Ozawa asked for their support for
the party in the election next year.

Based on the fact that labor unions affiliated with the All Japan
Prefectural and Municipal Workers' Union backed Social Democratic
Party candidates in the 2004 Upper House election, Ozawa told
Rengo executives: "We are considering joining hands with parties
against the LDP-New Komeito coalition. It is important to achieve
our common goal (of forcing the ruling coalition into a

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minority)." Rengo executives also expressed their willingness to
work closely with Minshuto.

Ozawa held a press conference in Yamagata City in which he
exhibited confidence about his party making a leap in the
upcoming election, stating, "The Upper House election next year
will lead to a change in administration. We have the edge."

Diet approval of amendments to the Public Offices Election Law in
the current session will create 29 single-seat constituencies for
the election next year. Of them, Minshuto has yet to determine
its candidates in about 20 constituencies. Ozawa is scheduled to
visit Kagawa and Tokushima later this month. He plans to visit
all single-seat constituencies at a pace of a couple of places a
week to determine candidates by mid-August.

DONOVAN