Identifier
Created
Classification
Origin
06TOKYO2854
2006-05-24 01:11:00
UNCLASSIFIED
Embassy Tokyo
Cable title:  

JAPANESE MORNING PRESS HIGHLIGHTS 05/24/06

Tags:  OIIP KMDR KPAO PGOV PINR ECON ELAB JA 
pdf how-to read a cable
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RUCNDT/USMISSION USUN NEW YORK 0399
UNCLAS SECTION 01 OF 11 TOKYO 002854 

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 05/24/06

Index:
UNCLAS SECTION 01 OF 11 TOKYO 002854

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 05/24/06

Index:

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

Defense and security issues:
4) Joint US-Japan security statement places alliance in a
"global scale" to respond to terrorism, natural disasters
5) Minshuto President Ozawa includes Taiwan in definition of
"regional contingency" under Japanese law
6) New Komeito internally seems ready to accept bill creating a
defense ministry that will be submitted to current Diet session
7) Full-scale coordination begins on withdrawing GSDF troops
from Iraq
8) Cyberterror: Fake e-mails purported from JDA chief and
Japan's top SDF brass came through China

ROK relations:
9) Japan, South Korean foreign ministers agree in meeting to
restart negotiations on EEZ boundary demarcation on June 12
10) No meeting of minds of Japan, ROK foreign ministers on
resolving North Korean abduction issue

11) China asks Japan to assume additional burden in cleaning up
poison chemicals left behind by Japan Imperial Army in WWII

12) Japan ready to pledge 40 billion yen in fresh aid for
environment, tsunami measures at upcoming Pacific islands summit

Political agenda:
13) IBM chairman rebuts Prime Minister Koizumi on the Yasukuni
issue
14) Minister Takenaka criticizes government's economic and
fiscal policy council
15) Gap in enthusiasm in government, ruling camp as Diet
committee starts deliberating bill amending Basic Education Law
16) Farm lobby Nokyo upset with Koizumi reforms, pushing LDP
to support Nokyo candidate in next summer's Upper House elections

17) Fast-food chains that had served beef bowls before ban on US

imports are split over returning to US beef after trade resumes

Articles:

1) TOP HEADLINES

Asahi:
Welfare Minister orders Social Insurance Agency to replace head
of Osaka office for illegal pension payment wavers

Mainichi, Yomiuri, Nihon Keizai & Tokyo Shimbun:
Six major banking groups book record 3.12 trillion yen in
combined profit

Sankei:
Bogus e-mails entering the e-mail address of ASDF Staff Office
sent to unspecified majority through Chinese provider

2) EDITORIALS

Asahi:

TOKYO 00002854 002 OF 011


(1) Unauthorized pension payment waivers by Social Insurance
Agency really stun us
(2) In final phase of Diet session, what should be tackled on
priority basis?

Mainichi:
(1) For safe withdrawal of SDF from Samawah, full preparations
necessary
(2) We expect new Keidanren chairman to display leadership to
create fair economic society

Yomiuri:
(1) Major banks should thank public in words, deeds
(2) Palestinian Authority should take responsible stance as
party concerned with Middle East peace process

Nihon Keizai:
(1) User-friendly financial revitalization should be aimed at
(2) Monopolized mail-delivery service must be rectified

Sankei:
(1) Parents are first teacher for children
(2) Hit-and-run incident involving 11-year-old boy: Police must
reflect on improper investigation

Tokyo Shimbun:
(1) There is no need to hurriedly enact referendum bill
(2) Detailed measures needed to prevent illegal parking

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, May 23

NIHON KEIZAI (Page 2) (Full)
May 24, 2006

09:01
Attended a cabinet meeting in Diet.

09:19
Arrived at Kantei.

10:58
Met with Singapore Minister Mentor Lee Kuan Yew.

14:00
Met with Cabinet Intelligence Director Mitani and JDA
Intelligence Headquarters chief Mukunoki. Later, met Environment
Minister Koike.

16:03
Education Minister Matsuda.

16:50
Met with Council of Experts on Administrative Reduction and
Efficiency Chairman Iida, its Chief of Secretariat Matsuda, and
others, joined by State Minister for Administrative Reform
Minister Chuma.

17:30
Attended a meeting of Council for Science and Technology Policy.


TOKYO 00002854 003 OF 011


19:02
Dined with US Ambassador to Japan Schieffer at Steak House
Katsura at Takanawa Prince Hotel.

21:22
Returned to residence.

4) Japan-US alliance to go global in scope

NIHON KEIZAI (Page 1) (Abridged)
May 24, 2006

Japan and the United States have entered into intergovernmental
coordination to issue a joint statement on the Japan-US alliance
and its significance when Prime Minister Junichiro Koizumi visits
the United States in late June. The two countries have now agreed
to realign US forces in Japan. In response to this agreement and
other factors, the joint statement will announce that the
bilateral alliance has now entered a new phase of global
cooperation. In the joint statement, the two governments will
clarify that Japan and the United States will act in concert to
deal with changes in the international situations following the
Sept. 11, 2001 terrorist attacks on the United States.

Koizumi will arrive in the United States on June 28 after
visiting Canada and will meet with President Bush on June 29.

Koizumi and Bush last documented a joint statement at their first
meeting in June 2001. The two leaders will set forth a stronger
alliance in their joint statement for the first time. Defense
Agency Director General Fukushiro Nukaga proposed documenting the
joint statement in his meeting with Defense Secretary Rumsfeld
following the final agreement reached between the Japanese and US
governments on the realignment of US forces in Japan.

The joint statement will sum up bilateral cooperation that has
substantially expanded in the security area through Japan's
antiterror backup measures, such as dispatching Self-Defense
Forces troops to Iraq and refueling US and other foreign naval
vessels in the Indian Ocean. The two leaders will underscore the
Japan-US alliance and its significance over again for the Asia-
Pacific region's peace and stability, thereby envisioning a new
framework for bilateral cooperation.

In their joint statement, Koizumi and Bush will specify a course
of action to overhaul the current setup of cooperation between
the SDF and US forces through "bilateral defense planning" in
anticipation of emergencies in Japan and through "mutual
cooperation planning" in anticipation of emergencies in areas
surrounding Japan. Based on that new framework, the two leaders
will proclaim that Japan and the United States will step up their
cooperation in order to deal with international terrorism and
respond to major disasters and diseases.

The Japan-US Security Treaty restricts Japan's cooperation to the
Far East. In addition, the Japan-US Security Joint Declaration of
1996 also goes no further than to describe bilateral cooperation
in the event of emergencies in Japan and contingencies in the
periphery of Japan. However, Japan and the United States have
already expanded the scope of their nonmilitary cooperation on a
global scale, including antiterror backup measures and disaster
relief activities.

TOKYO 00002854 004 OF 011



As it stands, Japan and the United States will confirm in the
joint statement that the two countries will further their
cooperation in various areas that are not covered in the security
pact.

5) Ozawa: Taiwan is included in contingencies in areas
surrounding Japan

SANKEI (Page 4) (Full)
May 24, 2006

In a press conference yesterday at party headquarters, Minshuto
(Democratic Party of Japan) President categorically said that
Taiwan is included in "areas surrounding Japan," as stipulated in
the regional contingency law: "It (Taiwan) is naturally
included." Ozawa told a key Chinese government official when he
was visiting China: "There would be trouble if China fires at
Taiwan and the shells fly in the direction of Okinawa as a
result. Such would be an attack (on Japan)."

6) Growing endorsement seen in New Komeito of submission of bill
to upgrade JDA during current Diet session

MAINICHI (Page 5) (Almost full)
May 24, 2006

By Hirohiko Sakaguchi

A growing number of New Komeito members are moving to endorse the
submission of a bill to upgrade the Defense Agency (JDA) to
ministry status to the current Diet session. Behind this move is
the party executives' desire to settle pending questions under
the current lineup of party executives whose terms in office will
expire in October in order to avoid any impact on the Upper House
elections set for next summer, as the bureaucrat-initiated bid-
rigging scandal involving the Defense Facilities Administration
Agency (DFAA) is likely to be concluded shortly. But some in the
party remain cautious about submission of the bill. The party
executives intend to coordinate views internally to decide on
their position before June 18, when the current Diet session is
to close, as to whether to allow the submission of the bill.

Consultations over what to do with the bill have continued
between the ruling Liberal Democratic Party (LDP),which is
positive about the bill, and its junior coalition partner New
Komeito, which is cautious. But the New Komeito turned even more
cautious with the revelation of the DFAA-led bid-rigging
scandals. As a result, many in the ruling parties believed that
it would be hopeless to submit the bill to the current Diet
session.

One reason why the New Komeito is moving to endorse the
submission of the bill to the current Diet session is because its
executives' terms of office expire in October. Representative
Takenori Kanzaki has hinted he will retire from his post. One
senior official explained: "We don't want to leave pending
questions in the hands of a new party lineup, which will have to
contest the Upper House election." Also, by allowing the
submission of the bill to the current Diet session, the New
Komeito intends to include its own pet measures, such as
expansion of child allowances, in the Basic Policies for Economic

TOKYO 00002854 005 OF 011


and Fiscal Management and Structural Reform the government will
shape in June and thereby to play up its identity ahead of the
Upper House election.

The gap between the LDP and the New Komeito over the JDA
upgrading bill has already been almost bridged. The major point
at issue was how to rename the JDA. The LDP insisted on renaming
it as "Kokubosho" (National Defense Ministry),while the New
Komeito asserted that the name of the JDA should be changed to
"Boei Kokusai Heiwasho" (Defense and International Peace
Ministry). But the new name of the JDA is likely to be "Boeisho"
(Defense Ministry) with the LDP's concessions to the New Komeito.

Some in the New Komeito are still opposed to the submission of
the bill, arguing that the DFAA scandal has yet to be concluded.
But if things go smoothly, the JDA is scheduled to announce a
final report on the scandal, as well as punitive measures,
possibly by the middle of next week. Taking this as an
opportunity to put an end to the scandal, the New Komeito
executives intend to speed up the process of coordinating views
in the party.

7) Government to make full-fledged coordination with US, Britain,
and Australia for GSDF withdrawal

YOMIURI (Page 2) (Abridged slightly)
May 24, 2006

Now that security authority in the southern Iraqi city of Samawah
is likely to be transferred from the multinational forces to the
Iraqi military and police in June, the government plans to make
full-fledged coordination with the United States, Britain, and
Australia to withdraw Ground Self-Defense Force troops from the
country. For starters, the government will send officials in
charge from the Foreign Ministry and the Defense Agency to the US
and Britain shortly and study a specific timeline and steps
through talks of working-level officials of Japan, the US,
Britain, and Australia.

Iraqi Prime Minister al-Maliki indicated at a press conference
May 22 that security authority in Muthanna Province, including
Samawah, would be transferred to Iraq in June.

Prime Minister Junichiro Koizumi welcomed al-Maliki's statement
before reporters yesterday, saying: "The statement showed his
government's enthusiasm for maintaining public order
independently."

The government has conditioned GSDF withdrawal on the
establishment of a stable Iraqi government and the transfer of
security and administrative authority to Iraq. If matters develop
as al-Maliki predicted, the government's scenario of beginning
withdrawal in June to complete it in July could become a reality.

When New Komeito Representative Takenori Kanzaki held talks
yesterday in Tokyo with Australian Ambassador to Japan Alistair
McLean, he said: "(The security situation in Samawah) has
improved, and Japan may decide to withdraw GSDF troops from Iraq
sometime soon."

But because the Iraqi government is still devoid of interior and
defense ministers, there is some skepticism in the Japanese

TOKYO 00002854 006 OF 011


government about the possibility of transferring security
authority to a full-fledged Iraqi government, as al-Maliki
predicted. Japan's concern is being fueled by continued terrorism
in Iraq. The government intends to carefully observe the security
situation in Iraq.

The government will also study specific ways to assist Iraq after
GSDF withdrawal. A plan has surfaced to invite senior Iraqi
government officials and cabinet minister to Japan while
continuing providing economic assistance, such as yen loans, and
humanitarian and reconstruction assistance in Iraq.

8) Fake emails sent via China, disguised as "Air Staff Office"

SANKEI (Top play) (Abridged)
May 24, 2006

A large number of fake emails were disseminated under Defense
Agency Director General Fukushiro Nukaga's name or the Air Self-
Defense Force Air Staff Office. Those fake emails were sent
through a Chinese server, sources said yesterday. The Defense
Agency suspects that the incident could be a cyberattack
involving Chinese hackers. The agency will shortly send a damage
report to the Tokyo Metropolitan Police Department in order to
identify the source of those emails.

In the middle of this month, an email message was sent to Self-
Defense Forces personnel and many other PC users. The email
showed the address of the Air Staff Office's public relations
section, and its subject was "Destroyer Fleet 16 and its 3
weeks." The email was from the "Defense Agency Air Staff Office
General Affairs Department." This section name, however, is not
actually used. It is therefore suspected of being a spoofed.

The email, in its text, was written in unnatural Japanese with an
attached file. If PC users receiving that email had opened the
attached file, their PC hardware could have been infected with
viruses and might have automatically forwarded the fake email to
their contacts listed in their PC address books.

The ASO public relations section received more than 1,000 inquiry
emails a day from those who received that fake email, so the
section was troubled in its daily operations. The MPD will likely
file a criminal case over this incident as an illegal act of
interfering with the Defense Agency's operations.

The Defense Agency tracked down the path of this fake email and
discovered that the email came through a server in China. The
attached file was a reproduction of information pages and photos
from a Japanese civic group's website, saying a nuclear-powered
submarine of the US Navy entered port at its Yokosuka base.

9) Japanese, South Korean foreign ministers agree to resume talks
on June 12 to negotiate on disputed EEZ demarcation between their
two countries

NIHON KEIZAI (Page 1) (Full)
May 24, 2006

Foreign Minister Taro Aso arrived in Qatar to participate in the
Asia Cooperation Dialogue (ACD). He met with his South Korean
counterpart Ban Ki Moon for about an hour and a half hours at a

TOKYO 00002854 007 OF 011


Doha hotel. They agreed to resume talks on June 12 and 13 to
discuss the two countries' exclusive economic zones (EEZ)
demarcation issue.

Ban also stated that the results of DNA analysis on Kim Yong Nam,
a South Korean abducted by North Korea, would be released by the
end of this month. Kim is most likely the husband of Megumi
Yokota, a Japanese national also abducted by that country. Ban
and Aso agreed to closely work together in order to settle the
abduction issue involving North Korea.

They also discussed ways to mend the strained relations between
the two countries due to Prime Minister Koizumi's visits to
Yasukuni Shrine. Ban called for prudent treatment of the issue.
Aso responded, "Japan's position is the same as it has repeatedly
announced." He then noted, "I, on my part, will make a judgment
properly taking into account my beliefs as a private citizen and
position as a public official."

They shared the view that it is important for the two countries
to continue efforts to resume the six-nation talks to discuss the
North's nuclear development issue. They also agreed to hold a
government-level meeting in June regarding a survey on remains of
former military personnel and drafted civilians who came from the
Korean Peninsula and conduct a joint field survey in July.

10) Tokyo-Seoul talks on EEZ demarcation bound to encounter
difficulties; Gaps also in views on abduction issue

YOMIURI (Page 2) (Excerpts)
May 24, 2006

By Tetsu Okazaki, Doha

In an attempt to prevent strained bilateral relations from
worsening further due to the issue of Japan's marine research
around a group of the disputed Takeshima/Dokdo islets in the Sea
of Japan, the foreign ministers of Japan and South Korea decided
yesterday to resume in June talks on the exclusive economic zones
of their countries. It will be difficult, however, for the two
countries to repair the strained relations.

Although the two ministers have confirmed cooperation in dealing
with the abduction issue after a visit to Seoul by Shigeru
Yokota, the father of abductee Megumi Yokota, there are major
differences in the two countries' approaches.

South Korea has pledged to extend economic assistance to North
Korea in place of cooperation to resolve issues, while Japan has
strengthened pressure. Therefore, one official said, "Since the
two countries have completely different views, there is a limit
for their cooperation at present."

11) Facility to dispose of chemical weapons abandoned by former
Japanese Army: Plan suspended after China demands more funding

MAINICHI (Page 2) (Full)
May 24, 2006

It was learned yesterday that a plan to construct a facility with
China to dispose of chemical weapons abandoned by the former
Japanese Army was suspended after China called on Japan to share

TOKYO 00002854 008 OF 011


additional costs. Tokyo and Beijing last October agreed to aim
for an early start-up of the disposal plant, by setting up a
Japan-China Consortium Organization that would serve as a vehicle
to construct the envisaged facility. However, no prospects have
been obtained even for signing a memorandum of understanding on
the establishment of such an organization, with China making a
fresh demand.

The disposal plant will be constructed in Jilin Province, China.
According to a Japanese government source, China during a meeting
in March called for additional outlays for cutting trees at the
construction site. A Chinese negotiator explained that since the
forest, where the plant is to be constructed, is a government-
designated forest reserve, it needs to have Japan pay additional
money for the removal of the designation.

A senior Cabinet Office official revealed Tokyo's position that
it is not possible to share such a cost with no clear legal
grounds provided. Since the Chinese side has not even presented a
specific amount of money, Tokyo remains unable to grasp its real
intent.

12) Government in Pacific Islands Summit plan to offer ODA worth
40 billion yen for environment and tsunami countermeasures

SANKEI (Page 2) (Excerpts)
May 24, 2006

The government started coordination yesterday to provide 14
island states in the Pacific region with 40 billion yen worth of
official development assistance (ODA) over the next three years
to allow them to finance measures to protect the environment and
to prevent flooding from tsunami. Prime Minister Junichiro
Koizumi will announce this plan during the fourth Japan-Pacific
Islands Forum Summit to be held in Nago City, Okinawa, on May 26-

27.

In the region, China has been trying to bring over to its side by
offers of economic assistance six countries that have not
established diplomatic relations with Taiwan. In response, the
government aims to hold China's moves in check by increasing its
ODA disbursements to these countries in an attempt to keep them
in Japan's camp.

The government provided the island states in the region with 30
billion yen in grant aid and technical cooperation in the past
three years.

According to government sources, the government will come up with
a plan in the summit to increase ODA funds for measures to
introduce an early warning system as a tsunami countermeasure; to
offer technical assistance to contain SARS; to construct
infrastructure; and to protect the environment.

13) Kitashiro rebuts Koizumi again, saying that business and
politics are not separate matters

ASAHI (Page 2) (Abridged slightly)
May 24, 2006

The Prime Minister's Official Residence (Kantei) and Keizai
Doyukai (Japan Association of Corporate Executives) have been

TOKYO 00002854 009 OF 011


increasingly at odds over the organization's urging Prime
Minister Junichiro Koizumi to halt his visits to Yasukuni Shrine.
In reaction to Koizumi's rebuttal that business and politics were
two separate matters, Doyukai Chairman and IBM Japan Chairman
Kakutaro Kitashiro said in a press conference yesterday: "State
policies, including the economy, must be determined properly."

In reaction, Chief Cabinet Secretary Shinzo Abe said
disapprovingly in a press conference yesterday, "One must not
take a narrow view of things."

"I hope the prime minister will refrain from visiting Yasukuni
Shrine for the sake of good Japan-China relations, not for
corporate achievement or industrial gains, " Kitashiro said. He
also indicated that the business leaders' association would
announce its stance on the Liberal Democratic Party's
presidential election in September, while taking into
consideration the party's stance on diplomatic issues, including
the Yasukuni issue.

Doyukai and IBM Japan have been besieged with telephones calls
and letters critical of the association's proposal. Despite that,
Kitashiro said: "A society where people can exchange diverse
views is healthy. We will sincerely lend our ears to other views,
but we will not change our proposal."

Abe told the press conference yesterday: "Doyukai should give
serious thought to the prime minister's motive and other factors
before making such a comment." Abe also said this regarding the
observation that the Doyukai proposal would have an impact on
Japan's policy toward Asia.

"Such a view is not totally correct. Basically, diplomatic
relations with China and South Korea are at stake. Relations with
India and ASEAN have deepened. One must not take a narrow-minded
view."

Meanwhile, Koizumi told reporters last night: "There are all
sorts of opinions. Some agree with me; others don't. Mr.
Kitashiro understands my position very well.

Koizumi had a dinner with business leaders on the night of May 17
in which Kitashiro said, "I'm sorry for all the fuss." In
response, Koizumi said, "It doesn't bother me."

14) Minister of Internal Affairs Takenaka declares that Council
on Economic and Fiscal Policy has "completed its role"

MAINICHI (Page 5) (Full)
May 24, 2006

By Daihaku Kasai

At a news conference yesterday, Minister of Internal Affairs
Heizo Takenaka remarked that the government's Council on Economic
and Fiscal Policy (CEFP) has turned from driving force to a
spectator, saying: "It has changed from an engine for reform to
an arena for it." Takenaka, who has been recently rumored to no
longer be a significant player in policy debates, issued a de
facto "declaration of the end of the CEFP," which he has led
until now and has been given the status of control tower for
reforms.

TOKYO 00002854 010 OF 011



Takenaka stated, "(The CEFP) already underwent a great change
about six months ago." He indicated that the nature of the panel
changed since Kaoru Yosano assumed the post of minister in charge
of the panel after the cabinet reshuffle last October. "I think
the role of reform engine has now been played by the (Liberal
Democratic Party),specifically, by its Policy Research Council
Chairman (Hidenao Nakagawa)," Takenaka added.

By emphasizing a shift in policymaking from the CEFP to the LDP,
Tanakena apparently is trying to criticize the way Yosano manages
the CEFP.

15) Lower House committee today begins deliberations on education
reform bill; Gap in "enthusiasm" between the government and
ruling camp

TOKYO SHIMBUN (Page 2) (Excerpts)
May 24, 2006

The Lower House Special Committee on the Basic Education Law
decided yesterday in a directors meeting to hold today a question-
and-answer session on the government's bill to revised the Basic
Education Law. About one week has passed since the bill was
submitted to a Lower House plenary session on May 16. The ruling
coalition managed to start deliberations at the committee. Since
the question of whether to extend the ongoing Diet session, which
is absolutely necessary to pass the bill through the Diet, has
yet to be resolved, discord is growing stronger in the government
and ruling camp.

Yesterday morning one committee director came down on Liberal
Democratic Party (LDP) Secretary General Tsutomu Takebe, saying,
"Are you trying to kill the bill?" The director took this action
because Takebe indicated in a speech on May 20 the possibility of
carrying the bill over to the next session for deliberations, not
extending the session.

The education policy clique in the Diet, including former Prime
Minister Yoshiro Mori, has discounted Prime Minister Junichiro
Koizumi, who has said "no extension," thinking that he has no
eagerness to pass the bill.

Therefore they were counting on LDP members seeking the passage
of the bill during the current session. If the LDP leadership,
including Takebe, follows Koizumi, the whole ruling coalition
could go along with the prime minister. Mori and his followers
then became nervous about Takebe's remarks.

Takebe then told reporters: "The government and ruling parties
will make utmost efforts to see the bill clear the Diet." But the
committee director said, "I don't understand why he has to
flatter the prime minister."

The main opposition party Minshuto (Democratic Party of Japan)
sees the discord in the government and ruling camp.

16) Nokyo political group to recommend cooperative member as LDP
candidate for next summer's Upper House election in defiance of
Koizumi reform drive

SANKEI (Page 4) (Excerpts)

TOKYO 00002854 011 OF 011


May 24, 2006

A backlash against Prime Minister Koizumi's reform program has
begun to appear in the selection of candidates for the next House
of Councillors. The political arm of the Japan Agricultural
Cooperatives (Nokyo) has decided for the first time to recommend
a member as a candidate of the Liberal Democratic Party (LDP) for
the next Upper House election, expressing displeasure with the
Koizumi reform drive. Upper House member Hiroko Goto, 58, also
announced her withdrawal from the LDP Oita prefectural chapter,
after opposing the government's postal-privatization legislation.

The Federation of National Farmers Agricultural Policy Campaign
Organizations (Noseiren) picked yesterday in a primary election
Toshio Yamada of the Central Union of Agricultural Cooperatives
(Zenchu) to recommend as a candidate on the LDP ticket. Yamada,
59, won yesterday's election, securing 239 votes of the 313
Nouseiren executives and representatives of the nationwide
agricultural cooperatives. He told reporters yesterday at a Tokyo
hotel, "Since the majority of organization (Noseiren) supported
me, I will do my best."

Noseiren had recommended career officials of the Ministry of
Agriculture, Forestry and Fisheries. Incumbent Upper House member
Keishiro Fukushima, 60, who was defeated by Yamada in yesterday's
election, obtaining just 57 votes, was a former bureau director
general of the Agriculture Ministry.

17) Responses to US beef: Sukiya "will not use;" Yoshinoya "will
use," while Matsuya "will carefully watch the situation"

ASAHI (Page 13) (Full)
May 24, 2006

The government is now likely to decide in June to resume US beef
imports. In response, President Kentaro Ogawa of Zensho Co., the
operator of the Sukiya chain, said yesterday that his company
would not use US beef for the time being, saying: "Its safety
will not be guaranteed."

When the government lifted its ban on US beef imports last
December, Zensho did not use the product. President Ogawa
stressed that improved safeguard measures, such as an
introduction of blanket testing, should be made a precondition
for Japan to resume imports. He said: "The condition of just
asking (the US not to include specified risk materials in beef
shipments to Japan) is far below safety standards laid in the
late 20th century. The system should be changed."

Yoshinoya D&C plans to put a beef bowl recipe using US beef on
its menu 12 to 18 months after the government decides to resume
imports, on the grounds that "there will then be no problem with
its safety." Matsuya Foods Co. is carefully watching the
situation, its spokesman saying: "Although we do not mean to say
that the company will never use US beef, we are carefully
watching the situation." As it stands, the leading beef-bowl
providers are taking different responses to US beef.

SCHIEFFER