JAPANESE MORNING PRESS HIGHLIGHTS 06/15/06

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E.O. 12958: N/A TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 06/15/06 Index: 1) Top headlines 2) Editorials 3) Prime Minister's daily schedule 4) Koizumi-Bush summit statement to stress the alliance in a global setting 5) Prime Minister Koizumi: Timing of SDF from Iraq will be a "comprehensive decision" 6) Fukuoka governor accepts the final report of the USFJ realignment 7) Yokosuka mayor goes along with deployment of nuclear-powered US Navy carrier 8) Yokosuka sailor arrested for molesting teenage girl 9) ROK foreign minister announces sea-bottom survey next month around disputed Takeshima isles 10) Indonesia delays signing of exchange of notes with Japan on provision of "weapons" -- patrol boats -- under foreign aid program 11) METI minister meets ASEAN security-general in Tokyo to discuss East Asian economic partnership agreement 12) No end to consumer distrust of US beef as government ends public hearings in 10 cities to gauge public views on restarting imports 13) In deciding to resume US beef imports, Japan plans to ban only those companies that commit risk-material violations 14) Finance Ministry panel's proposals to include hike in consumption tax, dedicated tax for social security 15) US' Public Company Accounting Oversight Board (PCAOB) asks FSA to let it independently oversee the Japanese auditors 16) Diet ends on June 18 with residue of disgruntlement among lawmakers desiring extension of session 17) Minshuto (Democratic Party of Japan) weakens call for resignation of BOJ Governor Fukui for investment in scandal- ridden Murakami Fund 18) Mori faction now likely to unite around SHINZO ABE as its LDP presidential candidate 19) Survey of LDP local chapters shows 23 ready for Abe-Fukuda presidential race in the fall Contents: 1) TOP HEADLINES Asahi: Japan Obstetrics and Genecology Association survey shows nation TOKYO 00003289 002 OF 013 has only 3,000 delivery facilities - about half of government data Mainichi: Salary-based bid-rigging and amakudari system established by DFAA Construction Department: A firm accepting a councilor for 15 million yen a year is allowed to place an order worth 800 million, a 12-million-yen bureau chief comes with 600-million-yen order, a 10-million-yen department chief with a 400-million-yen order Yomiuri: Government to establish amakudari watchdog body in Cabinet Office to check irregularities Nihon Keizai: Government, LDP eye lowering drug prices next spring to reduce government's contrition by 100 billion yen; Prices may be lowered up to 10 PERCENT yearly Sankei: Health, Labor and Welfare Ministry: Childbirths could drop to 430,000 in 2050 - 40 PERCENT of current level Tokyo Shimbun: Fiscal panel calls for consumption tax hike strictly for social security payments 2) EDITORIALS Asahi: (1)Diet session to end: 150 days a disappointment (2)EEZ demarcation: Japan, South Korea need clear rules to avoid critical situation Mainichi: (1)Elderly people deserve good medical care (2)BOJ Gov. Fukui must disclose assets Yomiuri: (1)DPJ shouldn't act out of partisan interests (2)High court overturns district court's absurd ruling on protection of news sources Nihon Keizai: (1)Consumers deserve improved housing code (2)Japan, South Korea must conduct talks persistency Sankei: (1)"Big-boned" policy guidelines must reflect fiscal panel report (2)Elevator accidents: Grater safety awareness imperative Tokyo Shimbun: (1)BOJ Gov. Fukui must resign (2)Japan must underline need for scientific whaling at IWC meeting 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, June 14 NIHON KEIZAI (Page 2) (Full) TOKYO 00003289 003 OF 013 June 15, 2006 10:45 Met at Kantei with ambassador to Madagascar. 11:05 Met with Shimada, special advisor to the Cabinet Office. 11:32 Met at LDP headquarters with Chief Cabinet Secretary Abe, Secretary General Takebe, and LDP Upper House Secretary General SIPDIS Katayama. 12:09 Met at Kantei with Deputy Chief Cabinet Secretary Nagase. 13:03 Attended a meeting of secretaries general of LDP prefectural chapters. 13:28 Arrived at Kantei. 15:15 Met with Internal Affairs and Communications Minister Takenaka, followed by Science and Technology Minister Matsuda, and lawmaker Hiroyuki Abe, member of the Council for Science and Technology Policy. 16:05 Met with Vice Foreign Minister Yachi. Met afterwards with Science Council of Japan Chairman Kurokawa and Chief of Secretariat Nishigahiro. 17:57 Attended party for the late Prime Minister Takeshita at Akasaka Prince Hotel. 18:35 Attended at Kantei a meeting of the Council for Science and Technology Policy. 19:36 Dined with commentator Naoki Tanaka, Canon Chairman Fujio Miterai, and Toyota Motor Chairman Hiroshi Okuda at Garden Court in New Otani Hotel. 21:21 Returned to his official residence. 4) Japan, US to mention Japan-US alliance in the world in a joint statement to be released after bilateral meeting, first summit statement in 10 years SANKEI (Page 5) (Excerpts) June 15, 2006 The Japanese and US governments are now in the final stage of coordination aimed at releasing a joint statement to be released after the upcoming summit meeting between Prime Minister Junichiro Koizumi and US President George W. Bush. The statement will position the Japan-US alliance in a global context, several government sources revealed. This will be the first joint Japan- US summit statement in 10 years, since the April1996 one released by Prime Minister Ryutaro Hashimoto and President Bill Clinton after their talks in Tokyo. Japan would like to use this summit as an occasion to sum up Prime Minister Koizumi's diplomatic efforts by highlighting to the rest of the world the significance of the Japan-US alliance now and in the future. The joint statement, in stressing the global importance of the alliance, will go one step beyond the previous Hashimoto-Clinton document that mentioned the bilateral alliance as "playing a key TOKYO 00003289 004 OF 013 role for peace, stability, and prosperity in the Asia-Pacific region." It also will underscore such commonly shared values as freedom and democracy. Both Japan and the US have agreed in principle to include a policy of emphasizing human rights in the planned joint statement. The Japanese government also wants to somehow stress in the statement the need to resolve the North Korea abduction issue. In addition, the statement is likely to mentions progress and cooperation in Japan-US economic relations. The statement will be concise and have a stronger political message than the previous one. It will seek to discourage China, North Korea, and Iran from their respective military buildups. 5) Gov't to consider all factors in deciding on timing for GSDF pullout from Iraq: Koizumi MAINICHI (Page 2) (Full) June 15, 2006 Prime Minister Junichiro Koizumi told reporters at his office yesterday evening that he would consider all factors in deciding on when to withdraw Ground Self-Defense Force troops currently deployed to Iraq. "I'm not wedded to the idea (of withdrawal during my term)," Koizumi added. The premier then ruled out the possibility of visiting Iraq. 6) Fukuoka gov. accepts final report on USFJ realignment MAINICHI (Page 2) (Full) June 15, 2006 Fukuoka Prefecture yesterday held a meeting of its assembly over the final report on the planned realignment of US forces in Japan, including a plan to relocate US military aircraft training to the Air Self-Defense Force's Tsuiki base in Fukuoka Prefecture. In the session, Fukuoka Governor Wataru Aso stated: "The realignment is a matter of Japan's security policy. In addition, we also should consider the wishes of people in Okinawa Prefecture to alleviate their base-hosting burden. I'm not thinking of asking the government to retract the plan." The governor also said he would ask the government for specific measures concerning the relocation of training flight missions. 7) Yokosuka mayor accepts nuclear carrier deployment SANKEI (Page 3) (Full) June 15, 2006 The city of Yokosuka, Kanagawa Prefecture, held a plenary meeting of its municipal assembly yesterday over the US Navy's planned deployment of a nuclear-powered aircraft carrier to its Yokosuka base in the prefecture. In the session, Yokosuka Mayor Ryoichi Kabaya clarified his intention to accept the US Navy's plan to deploy the USS George Washington, a nuclear-powered aircraft carrier, to Yokosuka in two years. "I think it would be unavoidable to let a nuclear-powered aircraft carrier enter port," the mayor stated before the assembly. Now that the mayor has accepted the nuclear carrier deployment plan, Yokosuka will be the first homeport in Japan for a nuclear-powered US flattop. TOKYO 00003289 005 OF 013 In response, the Japanese and US governments will hold a meeting of their joint committee today and will reach a basic agreement on berth dredging in the port of Yokosuka for a nuclear carrier's port entry. After that, the government will ask Yokosuka City for permission to start dredging work. Kabaya also stated, "I will ask the Japanese and US governments to ensure the safety of local residents and dissolve their anxieties." With this, the mayor has indicated that Yokosuka will hold consultations on safety assurances, including a mutual antidisaster assistance agreement with the US Navy. The Japanese and US governments agreed in October last year to replace the USS Kitty Hawk, a conventional aircraft carrier currently deployed to Yokosuka and expected to be mothballed in 2008, with a nuclear-powered aircraft carrier. However, Kabaya opposed the deployment of a nuclear carrier to Yokosuka and called for the US Navy to deploy the USS John F. Kennedy, another conventional flattop. In April this year, however, the US government accounted in writing for the safety of nuclear carriers. Kabaya then hinted at his intention to accept the nuclear carrier deployment plan. On June 12, the mayor met with Foreign Minister Taro Aso. After that, the mayor indicated his de facto acceptance of the deployment plan. "The government assured safety," he said. Kabaya won the mayoral election in June last year with a campaign pledge to call for the US Navy to continue its deployment of a conventional aircraft carrier. In October last year, the city's municipal assembly also resolved unanimously to call for the US Navy to retract its nuclear carrier deployment plan. Later in the day, Chief Cabinet Secretary SHINZO ABE met the press and appreciated the mayor's acceptance of the nuclear carrier deployment plan. "I appreciate the mayor for his understanding of the government's position," ABE said. 8) US sailor held for molesting high school girl in Yokosuka MAINICHI (Page 31) (Full) June 15, 2006 Yokosuka police in Kanagawa Prefecture arrested a US sailor yesterday on the spot for molesting a 15-year-old high school student. Danny Joseph Valerie, 47, a Yokosuka-based petty officer second class of the US Navy, is suspected of touching the first-year private high school girl's breast and kissing her at around 7:55 p.m. when she was talking to a friend at a square in front of Yokosuka Chuo Station on the Keihin Kyuko line of Keihin Electric Express Railway Co. in the city of Yokosuka, Kanagawa Prefecture. Valerie was drunk and has denied the allegations. 9) ROK foreign minister: "We will conduct a marine current survey around Takeshima/Dokdo next month"; Tensions may heighten again if survey is conducted ASAHI (Page 2) (Excerpts) June 15, 2006 Tadahisa Takatsuki, Seoul TOKYO 00003289 006 OF 013 At a news conference yesterday, South Korean Minister of Foreign Affairs and Trade Ban Ki Moon, speaking of the planned marine current survey in waters around Takeshima/Dokdo islets, stated: "Conducting a marine current survey within our territorial waters is our legal right. Japan cannot ask us to stop the survey." He thus revealed his intention to conduct the survey as planned. 10) Indonesia postpones signing an ODA agreement on Japan's offer of patrol boats; Jakarta opposed to limited use of boats only for antiterrorism and antipiracy YOMIURI (Page 2) (Excerpts) June 15, 2006 Etsunari Kurose, Jakarta The Japanese government had decided to offer three patrol boats in grant aid to Indonesia, treating this offer as an exception to the three principles banning weapons exports. A signing ceremony on an agreement on this offer was held yesterday, but the signing of the document was postponed at the last minute at the request of the Indonesian government, which stated an objection to the contents of the agreement. This development involving the ODA- related agreement is extremely unusual because that agreement was prepared as part of official development assistance (ODA),and the conditions for the agreement were closely examined before the agreement took shape. According to an official concerned, the two governments have agreed on limiting the use of patrol boats for such purposes as dealing with terrorism at sea and pirates, in view of Japan's three principles banning weapons exports. However, at the signing ceremony held in Jakarta yesterday, a senior Indonesian Foreign Ministry official asked Japanese Ambassador to Indonesia Shin Ebihara to alter the current wording to a more general expression like "activities relating to maritime safety." Japan rejected this request, and the two governments began coordinating on the wording again, but it is difficult for Japan to make concessions, as this is a very delicate matter that could violate the three principles on weapons exports. No prospect of both sides reaching accord has come into sight yet. A Japanese Embassy official commented: "They could have discussed the contents beforehand. We have no idea why they changed their mind today." 11) East Asia EPA; ASEAN secretary general during talks with METI minister indicates forward-looking stance toward discussing issue with ASEAN member nations TOKYO SHIMBUN (Page 8) (Excerpts) June 15, 2006 Minister of Economy, Trade and Industry Toshihiro Nikai yesterday met with visiting Association of Southeast Asian Nations (ASEAN) Secretary General Ong Keng Yong at a Tokyo hotel. In response to SIPDIS Nikai's proposals for signing an East Asian region economic partnership agreement (EPA) and setting up an organization for economic cooperation (OECD) and develop in that region, the TOKYO 00003289 007 OF 013 secretary general noted, "The proposal is worth considering. I SIPDIS would like to discuss the issue with ASEAN member nations." 12) Public hearings in 10 cities on US beef imports end, but doubts raised about demands TOKYO SHIMBUN (Page 8) (Excerpts) June 15, 2006 The Ministry of Health, Labor, and Welfare and the Ministry of Agriculture, Forestry, and Fisheries yesterday ended public hearings held with consumers in 10 cities across the nation on US beef imports. The government has already reached agreement with the US on a timetable for inspections of US plants with licenses to ship beef to Japan before resuming imports and will decide as early as next week to reopen its market to US beef. The first shipment is expected to arrive in late July. Domestic importers, though, are somewhat perplexed, as high demand in US beef cannot be anticipated due to public distrust in its safety. Related industries, including retailers and the food-service industry, are likely to be slow to move. Measures "Why is the US unable to take the same BSE preventive measures as Japan?" In a public hearing in Tokyo yesterday, one participant asked the above question. Similar views were presented in other places. In an effort to erase public distrust in the safety of US beef, the Japanese and US governments discussed plans to set rules on the assumption of problems occurring after trade is resumed, like a violation of safety procedures. But such rules were put on the backburner due to opposition from the US, which wanted to avoid taking time to set rules. Japan's decision to restart US beef imports apparently came under pressure from US legislators, with an eye on the upcoming midterm election. The Japanese government would like to obtain understanding from consumers with such measures as prior inspections, but consumer distrust is unlikely to be easily cleared away. Perplexity "The situation is quite different from when imports were resumed in December of last year, as there have been few inquiries about US beef," a responsible member of the Japan Meat Trade Association said with a tone of puzzlement. A spokesperson for Ito-Yokado Co. said: "We have no plan to put US beef on our store shelves until consumers regain confidence in the safety of the product." Zensho Co., the operator of the Sukiya chain, has categorically said: "We will not use US beef until such measures are taken as the complete removal of specified risk materials, the imposition of strict feed restrictions, and the implementation of blanket BSE testing." Another reason for the export association's mixed feelings is the 1,000 tons of meat worth about 1 billion yen stored in freezers or refrigerators across the nation since it could not clear customs following the imposition of a second ban on Jan. 20 of TOKYO 00003289 008 OF 013 this year. Once imports are resumed, the stored beef will be the first shipment, but their prices will inevitably fall. The association asked the US government to buy back the product, but the request was turned down. Expectations The Beef Barbecue Industry Association is waiting for an import resumption. An association member commented: "There is latent demand for US beef. There are people seeking low-priced, delicious beef." However, many beef barbeque chains are still undecided as to whether to use US beef, even if the government decides to resume imports. Restaurant chain Yoshinoya D&C Co. plans to put its signature gyudaon (beef bowl) back on the menu 6-8 weeks after Japan resumes US beef imports. The prices of the parts used for beef bowls are expected to be higher than those before December 2003, and the import volume is also likely to be smaller. Given this, the company intends to "offer the beef bowl for a limited time," according to a spokesman. 13) US beef imports: Government considering embargo on products from meat processing plants that have violated export conditions in event of inclusion of SRM in resumed US beef shipment to avoid total embargo YOMIURI (Page 1) (Full) June 15, 2006 It was learned yesterday that in the event of a possible inclusion of specified risk materials (SRM),a material banned in Japan as a BSE risk, in US beef shipments, Japan will in principle impose an embargo on products only from the slaughterhouses that shipped them. Several government sources revealed this. The government will likely decide to resume US beef imports after discussions with the US, making it a condition that the Japanese side conducts prior inspections of US meatpackers. It will clarify guidelines for imposing an embargo by that time. The government this January placed a total ban on US beef imports when vertebral columns were found in shipments, based on the supplementary item included in the report compiled by the Cabinet Office's Food Safety Commission. The item stipulates that it is necessary to temporarily suspend imports if a serious situation in which risks against humans cannot be ruled out occurs. However, there have been some critical views on this for being vague. For this reason, the government will confer on this issue with the US and set guidelines, including that a total ban will be placed only in the event of a serious violation of the bilateral agreement, making it a principle that an import ban be placed only on a meat processing plant that has violated the agreement. However, some government officials take the position that the GOJ will not be able to obtain understanding from the public unless a total ban is imposed in the event of export violation. The South Korean government has indicated a policy of postponing the resumption of US beef imports slated for early this month, following the finding of problems in inspections of US TOKYO 00003289 009 OF 013 meatpackers. In response to this move, a proposal that Japan should resume imports after conducting inspections of US meatpackers has been floated. In that case, a delay in the drafting of guidelines is likely to occur. 14) Fiscal System Council proposes turning consumption tax into special purpose tax to appropriate revenues for social welfare TOKYO SHIMBUN (Top Play) (Excerpts) June 15, 2006 The Fiscal System Council (an advisory panel reporting to the Finance Ministry) yesterday presented to Finance Minister Sadakazu Tanigaki an opinion paper on unified reform of expenditures and revenues, which sets a direction for fiscal reconstruction. The report pointed out the need to increase the consumption tax, noting that since social security expenditures are bound to increase due to the low birth rate and the graying society, it is important to secure stable funding that is relatively less affected by the health of the economy. It referred to the idea of turning the consumption tax into a social- welfare-dedicated tax by mentioning that appropriating increased revenues from such a hike for the payments of social security benefits will be meaningful from the standpoint of obtaining understanding from the people. The report stressed that social security expenses, which account for more than 40 PERCENT of general-account spending, will expand at a rate exceeding economic growth. In view of the prospect that the proportion of money spent on basic pension plans will increase by fiscal 2009, the report underscored the need to secure specific and stable funding resources (tax revenues),thereby strongly indicating the need to hike the consumption tax. Regarding other social-welfare-related spending items, the panel proposed a revision to the system of additional payments of welfare benefits to families of mothers and children and the abolition of government spending on unemployment benefits. Regarding local finances, an issue that is equally important to the social security issue, the report pointed out that the primary balance, which indicates fiscal soundness, of the central government is in the red, while that of local governments is in the black. For a revision to the system of tax allocation to local governments, under which a fixed amount of revenues from national taxes, such as the income tax, are distributed to local governments, the report proposed that such a revision should be made in a way to lead to a reduced national burden, including a cut in the legal rate. 15) US supervisory board ready to oversee Japanese audit firms; FSA proposes firms' briefings in US ASAHI (Page 1) (Excerpts) June 15, 2006 The Public Company Accounting Oversight Board (PCAOB) - a private- sector, non-profit corporation to oversee accounting firms in the US - has started arrangements with the Financial Services Agency TOKYO 00003289 010 OF 013 (FSA) to implement its own inspections of Japanese audit firms. According to informed sources yesterday, PCAOB has asked Japan to allow it to start by the end of this year on-site inspections into 12 corporations registered with it, including ChuoAoyama PricewaterhouseCooper and other three major corporations. The FSA, however, based on the view that "their sovereignty might be infringed," has proposed that the targeted audit firms would visit the US to explain their management systems. The agency plans to hold talks with PCAOB executive members. PCAOB was established based on the Sarbanes-Oxley Act in July 2002, set off by a series of scandals involving Enron and other firms. As measures to prevent such scandals, the corporation has been tasked with overseeing the business contents of accounting firms in the preparation of informative and independent audit reports. Foreign accounting firms overseeing listed companies in the US are required to register as members of PCAOB. In the US, many foreign firms have been listed on the US market, including Sony Corp. and Toyota Motor Corp. If public confidence of foreign accounting firms is undermined, there may be an adverse impact on the US securities market. As of June, 1,669 auditing firms in about 80 countries have registered with PCAOB. PCAOB has made the same request to countries other than Japan and has already carried out on-site inspections of accounting firms in Britain and Canada in cooperation with local authorities. In the case of Japan, since public confidence in the audit corporation system has crumbled in the wake of the scandal involving ChuoAoyama and heavy administrative punishment imposed on it, PCAOB has judged it necessary to immediately conduct inspections. 16) Ruling camp decides not to extend current Diet session; LDP, New Komeito members dissatisfied with Koizumi going over parties' heads TOKYO SHIMBUN (Page 2) (Full) June 15, 2006 The ruling Liberal Democratic Party (LDP) and its junior coalition partner New Komeito confirmed in a meeting yesterday of their secretaries general and Diet affairs committee chairmen a policy of not extending the current Diet session, which will close on June 18. The ruling camp has made this decision in compliance with the wishes of Prime Minister Junichiro Koizumi, who had rejected the possibility of an extension. LDP lawmakers representing educational-policy interests (bunkyo-zoku),who called for an extension to pass such important bills as education reform bill through the Diet, and New Komeito members are increasingly dissatisfied with Koizumi, who ordered Diet management decisions to the ruling parties going over their heads. On May 30 Koizumi made a final decision not to extend the current session. The educational clique immediately reacted strongly to his decision because they were eager to pass the bill revising the Basic Education Law through the Diet during the current session. On June 1 successive education ministers called at the Prime TOKYO 00003289 011 OF 013 Minister's Official Resident to directly ask Koizumi to extend the session. They told the prime minister: "Why don't you crown your glory with the passage of education reform legislation?" Koizumi simply replied, "I don't have no such intention." One former education minister said angrily, "We could not continue to say anything more. It is unbelievable that so many crucial bills have been left untouched." The LDP and New Komeito agreed on June 2 to make a decision this week as to whether an extension would be needed or not and to seek a minor extension if prospects for passage of key bills were in sight. On June 7, however, Chief Cabinet Secretary SHINZO ABE and LDP Secretary General Tsutomu Takebe already agreed not to extend the SIPDIS session. Moreover, prior to the meeting of secretaries general and Diet affairs committee chairmen, Koizumi met yesterday with LDP executives, including Takebe, in which they confirmed that the session would not be extended. 17) Minshuto hesitant about demanding Fukui's resignation over Murakami Fund investment in wake of e-mail fiasco ASAHI (Page 4) (Excerpts) June 15, 2006 Minshuto (Democratic Party of Japan) executives are cautious about pursuing Bank of Japan Governor Toshihiko Fukui's responsibility for investing 10 million yen in the Murakami Fund. Some mid-level and junior members are eager to even demand Fukui's resignation, however. Having learned a bitter lesson from the recent fake e-mail fiasco, the party leadership apparently fears that the Fukui case will escalate into a "witch hunt" involving the entire political community, as was the case with the unpaid national pension premium scandal in 2004. But depending on how the Upper House Budget Committee session today turns out in trying to find out facts, the largest opposition party may bolster its pursuit. The Diet affairs chiefs of Minshuto, the Japanese Communist Party, and the Social Democratic Party reached an agreement yesterday to demand Fukui's attendance at today's Upper House Budget Committee session and out-of-session hearings as well as to pursue Prime Minister Koizumi's responsibility for appointing him to the post. But not all opposition party executives share the same view. For instance, Minshuto Secretary General Yukio Hatoyama said in his speeches yesterday in Sapporo and Yokohama: "The BOJ governor have been raking in from a high-yield fund while people were suffering from the zero interest rate. Such is morally absurd." Minshuto policy chief Takeaki Matsumoto also said yesterday: "I think Mr. Fukui will decide on his course of action independently." Neither Hatoyama nor Matsumoto mentioned Fukui's resignation. Minshuto Diet affairs chief Kozo Watanabe insisted on June 13 that Fukui must resign. But in an apparent reversal of his previous stance, Watanabe only said yesterday: "The matter must TOKYO 00003289 012 OF 013 be elucidated from the people's viewpoint." In stark contrast to Watanabe, SDP head Mizuho Fukushima crisply said in a press conference yesterday: "We will demand Mr. Fukui's resignation." A Minshuto Diet affairs executive also commented: "It's better not to jump at a juicy story of this sort. We just had our e-mail flop." Some Minshuto members think their party should focus only on finding out facts for the time being. 18) Many Mori faction members support ABE as candidate for LDP presidency NIHON KEIZAI (Page 1) (Full) June 15, 2006 Senior members of the largest faction in the Liberal Democratic Party (LDP) got together last night at a Tokyo hotel to discuss measures for the LDP presidential election in September. Attending the meeting were former Prime Minister Yoshiro Mori, who heads the faction, and Nobutaka Machimura, secretary general of the faction. Based on the perception that many faction members support Chief Cabinet Secretary General SHINZO Abe, the senior members agreed that they should run a united candidate in a drive to prevent a split in the faction. They also confirmed that if former Chief Cabinet Secretary Yasuo Fukuda decides to run in the race, the faction would go along with his decision. LDP Diet Affairs Committee Chairman Hidenao Nakagawa, Koji Omi, and Seishiro Eto attended the meeting. They did not ask ABE and Fukuda to attend the session. After the discussion, Machimura told reporters, "We shared the same view that the majority of the faction wanted it to run a unified candidate." The senior members also agreed to maintain the unity of the faction, while waiting for decisions by ABE and Fukuda. Another senior member told reporters, "Many in the party support Mr. Abe." Mori is expected to meet Prime Minister Junichiro Koizumi to discuss the matter. Koizumi has expressed that there is no need for the faction to run a unified candidate, saying, "There is no way to prevent a person, who wants to run, from running in the election." ABE also stated a similar view to Koizumi. In order to avoid the faction from splitting, Mori expects either ABE or Fukuda will give up the idea of running the race on his own decision. 19) Survey of LDP presidential race: 23 prefectural chapters expect face off between Abe, Fukuda; ABE wins nine supporters, Fukuda six MAINICHI (Page 1) (Excerpts) June 15, 2006 The Mainichi Shimbun has conducted an opinion survey of all Liberal Democratic Party (LDP) prefectural chapter secretaries general on the upcoming LDP presidential election. In the poll, 23 party officials -- nearly half of the total -- said they would like to see a showdown between Chief Cabinet Secretary SHINZO ABE and former Chief Cabinet Secretary Yasuo Fukuda. Both candidates belong to the Mori faction. In contrast, only 11 secretaries general favored producing a single candidate through talks. TOKYO 00003289 013 OF 013 Fourteen people, the largest number, also cited the correction of the social disparity as the most important campaign issue. Nine people said ABE was most fit to become the next prime minister, followed by Fukuda with six, and Foreign Minister Taro Aso with five. The survey was conducted between June 7 and 12. Responses came back from 41 regional secretaries general. In an LDP presidential election, local votes are allocated based on the number of rank- and-file party members. Prefectural secretaries general are believed to have strong voices toward local organizations, as former prefectural assembly members with abundant experience usually take on such posts. SCHIEFFER