JAPANESE MORNING PRESS HIGHLIGHTS 06/21/06

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E.O. 12958: N/A TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 06/21/06 Index: 1) Top headlines 2) Editorials 3) Prime Minister's daily schedule Iraq pullout: 4) Text of Prime Minister Koizumi's press remarks on GSDF withdrawal from Iraq 5) ASDF next month likely to expand transport services in Iraq 6) With withdrawal of GSDF from Iraq, Japan will now shift to energy development assistance centered on ODA 7) As GSDF leaves Iraq, Chief Cabinet Secretary Abe voices preference for permanent SDF dispatch law to replace limited timeframe measures 8) US, leaning toward hard-line stand toward North Korea on missile launch issue, schedules talks with Japan to strengthen pressure on Pyongyang 9) Japan, US, Taiwan strengthening ties at think-tank level to deal with China "threat" Beef talks: 10) Agreement almost there between US, Japan on resumption of US beef imports, with shipments likely to start in July 11) US beef could be on supermarket display counters by late July 12) Yoshinoya planning beef bowls on menu in September, but much of food service industry remains cautious about US beef 13) Government in resuming US beef imports steamrollering objections of consumers, who remain concerned about food safety Political agenda: 14) Shinzo Abe to declare candidacy for LDP president in later August 15) Ruling camp fears public reaction to BOJ Governor Fukui's admission of profiting from Murakami funds, while opposition wants him to quit 16) Minshuto (Democratic Party of Japan) puts off punishment of lawmaker Matsui for allowing Murakami Fund to pay aide's salary Articles: 1) TOP HEADLINES Asahi & Yomiuri: BOJ Governor Fukui earned 14.73 million yen from investment in Murakami Fund Mainichi & Tokyo Shimbun: Supreme Court says "indefinite sentence clearly unjust," orders High Court to reexamine murder case with a view to imposing death penalty Nihon Keizai: BOJ governor: BOJ will take quick, nimble action on monetary policy; Zero-interest policy expected to be kept in place for now Sankei: People's New Party's House of Representatives member Itokawa pressured by construction firm employees not to "pursue" land TOKYO 00003440 002 OF 011 deal in Diet interpellations 2) EDITORIALS Asahi: (1) SDF pullout from Iraq: Ends do not justify the means (2) BOJ: Weightiness of governor's position Mainichi: (1) GSDF withdrawal from Iraq: Expanding reconstruction assistance to Samawah (2) BOJ Governor Fukui: System needed that does not give rise to suspicions Yomiuri: (1) SDF troops in Iraq: Pullout from Samawah does not mean an end to assistance (2) BOJ Governor Fukui's investment profit: Job may be in jeopardy if confusion continues Nihon Keizai: (1) We welcome decision to pull out GSDF troops from Iraq (2) BOJ Governor Fukui faces tough task in restoring public trust Sankei: (1) Pullout of GSDF troops from Iraq: Public security remains an open question (2) Murder of mother and child: Supreme Court's call for capital punishment is appropriate Tokyo Shimbun: (1) SDF withdrawal from Iraq: Every possible measure should be taken until all troops return home (2) BOJ Governor Fukui: Suspicions deepen 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, June 20 NIHON KEIZAI (Page 2) (Full) June 21, 2006 09:01 Arrived at the Prime Minister's Office (Kantei) 09:33 Executive meeting at the LDP Headquarters 09:53 Cabinet meeting, followed by investment meeting, then conference on measures to deal with low birth rate. 11:03 Party head discussion with New Komeito leader Kanzaki. LDP Secretary General Takebe and New Komeito Secretary General SIPDIS Fuyushiba were present. Then liaison conference between the government and the ruling coalition. Then met with Japanese Communist Party Chairman Shii and Social Democratic Party Leader Fukushima. 12:07 TOKYO 00003440 003 OF 011 Security meeting. Met with Iraqi Ambassador to Japan Al-Jumaily, followed by Chief Cabinet Secretary Abe. 13:00 Press conference 14:01 Met with Miki Yoshida, chairman of the Okami Association of Japanese Ryokan, followed by Upper House member Yoriko Kawaguchi. 15:00 Meeting of the Campaign Headquarters at LDP Headquarters. Took photos with those who plan to run in next year's Upper House election. Handed an endorsement certificate to a candidate for the Lower House by-election for the Kanagawa No. 16 Constituency. 16:30 Met with Foreign Ministry Middle East and African Affairs Bureau Director General Yoshikawa at the Kantei. 17:07 Cabinet meeting on measures to deal with crime and a joint meeting of the Headquarters to Promote Measures to Nurture Young People. 18:44 Met with chiefs of secretariat of various government agencies and the Diet Liaison Office chief at Grand Arc Hanzomon Hotel. 19:02 Dined with LDP Policy Research Council Chairman and Acting Chairman Nakagawa and Amari and others at a Chinese restaurant at Kioicho. 20:54 Returned to the official residence. 4) Gist of Koizumi's press remarks YOMIUIRI (Page 4) (Full) June 21, 2006 The following is a gist of Prime Minister Koizumi's remarks in yesterday's press conference: Japan has consulted with the United States and other multinational force members, including the United Kingdom and Australia. As a result, I judged that the Ground Self-Defense Force has now fulfilled its role to a certain extent through its reconstruction assistance activities, and I therefore decided to withdraw the GSDF unit. Japan will continue to help with Iraq's nation rebuilding efforts, and I'd like to continue Japan's assistance as far as possible while working together with various countries and the United Nations. This is not a matter of me wanting to or feeling the need to withdraw the GSDF unit while I'm in office. I happened to make my overall judgment at this point, and I'm pleased that I can withdraw the GSDF unit. At this point, I'm not thinking of going to Iraq, because I wouldn't want to burden other countries unnecessarily with my security. I believe that the various steps taken toward Iraq in compliance with United Nations resolutions TOKYO 00003440 004 OF 011 were right. The international community has now overcome the difference of opinions we faced when the war started. The international community has agreed to carry out assistance appropriate for each country. I'm aware of the Japan-US alliance and its importance, and Japan will continue to work together with the international community. I wouldn't say we need to create a permanent law in the next Diet session (for Japan's future overseas dispatch of Self-Defense Forces troops). But we must discuss the matter. 5) ASDF to expand Iraq airlift missions next month NIHON KEIZAI (Page 1) (Abridged) June 21, 2006 The government has now decided to withdraw Ground Self-Defense Force troops deployed in the southern Iraqi city of Samawah. Based on the decision, the government began yesterday to prepare for the Air Self-Defense Force to expand its airlift missions in Iraq. The ASDF will expand the scope of its activities in July at the earliest and support the US military and the United Nations in order to airlift their supplies and personnel. In addition, the ASDF will also send personnel to the multinational force's headquarters in Baghdad to facilitate coordination. The GSDF currently stations some personnel at the multinational force's headquarters, but they will be replaced with ASDF personnel along with the GSDF's pullout from Iraq. The ASDF currently bases its airlift squadron in Kuwait, where about 200 ASDF members are deployed. The ASDF will reinforce the squadron with about 10 more personnel. ASDF transport planes have been on airlift missions from Kuwait to Taril near Samawah. In July, the ASDF will extend its airlifts to Baghdad and the northern Iraqi city of Arbil. In Baghdad, however, aircraft could be targeted in terrorist attacks. The government is therefore careful about the right timing. Defense Agency Director General Fukushiro Nukaga ordered senior officials in a meeting yesterday to fully consider the local security situation. "Cargo transport is not something your rush into; I want them to pay full attention to safety," Nukaga said. 6) Japan to provide Iraq with energy development assistance centering on ODA after GSDF withdrawal, call for creation of international assistance framework YOMIURI (Page 2) (Full) June 21, 2006 Following its decision yesterday to withdraw Ground Self-Defense Forces (GSDF) troops from Iraq's southern city of Samawah, the government made another decision to give reconstruction assistance to that country as part of it official development assistance (ODA). The focus of the aid will be on development projects related to such energy resources as oil and natural gas. The aim is to facilitate economic recovery in Iraq by advancing the reconstruction of infrastructure relating to energy resources that are abundant there. The government intends to call on the international community to work together to create an international framework for assistance to Iraq, although some countries, such as France, which was opposed to US forces' TOKYO 00003440 005 OF 011 attacks on Iraq, still remain unwilling to participate in reconstruction assistance to Iraq. Prime Minister Koizumi met with Iraqi Ambassador to Japan Al- Jumaily at the Prime Minister's Official Residence at noon yesterday and told the envoy: "We'll continue our assistance to Iraq." The ambassador told Koizumi: "We have greatly appreciated Japan's assistance it offered during a difficult time." In October 2003, Japan announced it would provide Iraq with 5 billion dollars in assistance using the ODA program. Of that amount, 1.5 billion dollars in grant aid have already been targeted for specific use. Of the 3.5 billion dollars in yen loans, approximately 2.8 billion dollars remain undecided as to use. In order to provide assistance to repair works at such facilities as the oil factory in Basra in southern Iraq and oil or liquefied natural gas (LNG)-related facilities in various other locations in the country, coordination is underway. A senior Foreign Ministry official commented: "Iraq is abundant in natural resources. Development of oil or natural gas fields will directly lead to foreign currency earnings and will become driving force for the reconstruction of the country." The government wants to be actively engaged in creating an international assistance framework for Iraq. Foreign Minister Aso yesterday afternoon held a teleconference with Iraqi Foreign Minister Zebari. Zebari asked Aso, "A plan to create a new international framework for assistance to Iraq is now afloat. We'd like Japan to participate in that framework as an important partner of our country." Aso indicated a positive stance, telling Zebari: "We'd like to address the matter while basically following that direction." 7) Abe positive about enacting permanent law for SDF missions overseas and eliminating need for ad hoc legislation ASAHI (Page 2) (Abridged) June 21, 2006 The government has now decided to withdraw Ground Self-Defense Force troops currently deployed to the southern Iraqi city of Samawah. In this connection, Chief Cabinet Secretary Abe took a positive stance in a press conference yesterday about creating a permanent law that would allow the government to dispatch Self- Defense Forces personnel overseas without need to pass a special measures law each time. With the SDF's Iraq dispatch as the chance, some in the government and ruling parties are calling for permanent legislation to allow SDF participation in multinational forces overseas. This will likely be a task for the post-Koizumi government. The ruling Liberal Democratic Party is already studying permanent legislation, Abe said in the press conference. "It will be possible to take flexible measures and make international contributions," he added. One government official also suggested the need for the next government to address the matter after all Air Self-Defense Force personnel are back from their Iraq mission. "When it comes to a permanent law, there will be various TOKYO 00003440 006 OF 011 problems," Prime Minister Koizumi said in a news conference yesterday. "I'm not thinking of creating a permanent law while I am in office," Koizumi added. Meanwhile, Defense Agency Director General Nukaga yesterday ordered the ASDF to reinforce its Kuwait-based squadron in order to expand the scope of its airlift activities in Iraq. The ASDF will send personnel to the multinational force's headquarters in Baghdad to liaise. "We will meet the needs of the United Nations and the United States," Nukaga said. The ASDF will continue to airlift supplies and conduct humanitarian reconstruction assistance activities, the defense chief said. The ASDF is expected to expand the scope of its activities in Iraq within the month after coordination with the United Nations. 8) Preparation for firing Taeopdong-2 missile underway; US taking hard-line policy; Will discuss with Tokyo ways to strengthen pressure on Pyongyang YOMIURI (Page 7) (Excerpts) June 21, 2006 North Korea is now preparing to launch a long-range ballistic missile. The prevailing view among persons familiar with US-North Korea relations here in Washington is that even if the North does not actually test-fire a missile, the Bush administration's policy toward that nation is certain to become even tougher. Commenting on a possible missile launch, Secretary of State Rice on June 19 told a press conference, "We are now considering the next step." She thus revealed that Washington is now conferring on measures to strengthen pressure on that nation. Pointing out that the North has started preparations to launch a missile, turning its back on the six-party talks, Rice hinted that there is no chance of Washington making concessions in order to stop Pyongyang from test-firing a missile. There has been a clash of views in the Bush administration over whether to give priority to dialogue or pressure. However, now that Pyongyang is preparing to launch a missile, Deputy Assistant Secretary of State Christopher Hill, who has aimed to settle the SIPDIS issue through diplomatic efforts, is bound to find himself in a difficult situation. 9) Japan, US, Taiwan strengthen cooperation in security talks on responding to China threat SANKEI (Page 5) (Excerpt) June 21, 2006 A symposium on the theme, "Security dialogue for peace and stability in the Taiwan Strait," (convened by the Okazaki Research Institute and sponsored by Sankei Shimbun) was held in Tokyo on June 20 to discuss ways to deal with China, which is rising economically and militarily. The participants, who included lawmakers from Japan, the United States, and Taiwan, former senior government officials, and former military brass, carried on lively discussions. The symposium consisted of a keynote speech and three sessions. In the keynote speech, former ambassador to Thailand Hisahiko Okazaki pointed out the current situation in the Taiwan Strait, where China is gradually gaining the advantage, upsetting the military balance between it and TOKYO 00003440 007 OF 011 Taiwan. He said there was a possibility in the future of China, with the intention of bringing about its unification with Taiwan, threatening it with armed force to create turmoil in the political realm. In order to avoid such a crisis, he proposed the need for creating a new consultative body between the US and Taiwan for close discussions on the military issue. 10) Japan, US fail to reach agreement on US beef import resumption; Further discussions to be held today ASAHI (Page 1) (Full) June 21, 2006 The governments of Japan and the US held a bureau director-level teleconference yesterday evening in order for Japan to resume US beef imports. During the talks, the Japanese delegation indicated its intention to resume imports under certain conditions, including allowing Japan to confirm the safety of US beef by conducting prior inspections of US meat-processing plants. However, no agreement was reached, so the two sides decided to hold another round of talks this morning. The teleconference started at 8:00 p.m. yesterday, with the participation of Deputy Undersecretary of Agriculture Chuck Lambert from the US side and bureau director generals and councilors of the Foreign Ministry, the Ministry of Agriculture, Forestry and Fisheries (MAFF) and the Ministry of Health, Labor and Welfare (MHLW) from the Japanese side. As conditions for reinstating the beef trade, the Japanese delegation asked the US to approve the presence of Japanese officials at surprise inspections of meatpackers conducted by the US side. The talks continued until shortly after 12:00 am, but the two sides could not reach agreement on items subject to prior inspections and ways to facilitate such inspections. The two sides will resume telephone talks at 9:00 this morning. If they reach a consensus, experts dispatched by MOFA and MHLW will carry out prior inspections of 35 US meatpackers. The outlook is that US beef imports will start in late July, once it is confirmed that the safety of products to be exported to Japan is secured in compliance with the conditions agreed on between the two countries. 11) US beef likely to be on shelves again in late July; Last- minute negotiations going on NIHON KEIZAI (Page 4) (Full) June 21, 2006 Over the issue of resumption of US beef imports, the governments of Japan and the United States held a teleconference between senior officials from the Agriculture, Forestry, and Fisheries Ministry (MAFF) and the US Agriculture Department last night. The conference ended before dawn today and will be resumed this morning to work out details. Both countries are expected to agree, possibly today, to resume US beef trade on such conditions as inspections of facilities certified to export beef to Japan before Japan resumes imports. US beef is likely to be put on store shelves in Japan again. The Japanese government imposed a ban on US beef imports in December 2003 following the discovery of the first case of BSE in TOKYO 00003440 008 OF 011 the US. The ban was lifted last December but was reinstated this January after vertebral columns, a specified risk material (SRM), was discovered in a veal shipment to Japan. Tokyo and Washington are expected to reach an official accord on such conditions as prior inspections by Japanese government officials of 35 meatpacking plants to check whether they have complied with the requirements agreed on for the removal of the import ban. In the teleconference yesterday, since details were not worked out, both sides decided to continue discuss the details today. The possibility is now strong that a settlement will be reached on the pending issue of US beef imports prior to the Japan-US summit set for next week. Should no problem be found in the prior inspections, Japan will reopen its market to US beef. About 1,000 tons of beef that arrived in Japan just before the second ban in January but has yet to clear customs has been stored in freezers or refrigerators across the nation. The government plans to examine all of the beef and then put it on store shelves. Health, Labor, and Welfare Minister Jiro Kawasaki said yesterday that officials "will inspect all beef imported from the US for the time being." The government also intends to carry out snap and regular inspections of US meatpacking facilities. But many consumers are still skeptical of the reliability of the United States' safety-management system, keeping in mind the fact that prohibited materials were also found in beef shipments to Hong Kong and Taiwan. South Korea has put off its planned resumption of US beef imports after defects were found in its prior inspections into US facilities. MAFF Minister Shoichi Nakagawa said that if some flaws are found in inspections, Japan would also discuss the issue (with the US) again." 12) Yoshinoya willing to put beef bowl on menu possibly in September, but most restaurant chains, distributors remain cautious NIHON KEIZAI (Page 4) (Full) June 21, 2006 The governments of Japan and the United States are expected to reach an agreement on the resumption of US beef trade. Following this development, some gyudon (beef bowl) and beef barbecue restaurant operators will soon start preparations to buy US beef. Yoshinoya D&C Co. will put gyudon on its menu in late September at the earliest. However, consumers have been skeptical of the safety of US beef in the wake of the discovery of specified risk materials considered to be a BSE risk in a veal shipment to Japan in January. Given this, most retailers and restaurant chains are cautious about using US beef. Japan Food Service Association Chairman Kazuhide Maihama said yesterday: "We welcome the growing possibility that US beef imports will be resumed soon. Many restaurant operators, including beef barbeque and tongue restaurants, have received a serious blow. I hope imports will be resumed as soon as possible. I expect the government to give an explanation to consumers and operators in a proper way." TOKYO 00003440 009 OF 011 Under the agreed conditions, shipments are limited to beef from cattle aged 20 months or younger, so Yoshinoya expects only 1,000 tons of meat will be available per month, which is equivalent to 40% of the volume recorded before the initial import ban was imposed in December 2003. It plans to offer the dish only for limited hours, like lunchtime. Although its rivals have used Chinese or Australian beef, Yoshinoya has kept its policy of using only American beef and has stopped serving gyudon. As a member of its planning office said: "In the case of US beef, it is possible to procure a large volume of parts that we need and those with plenty of fat on them, which Japanese love," the company believes that American beef is most suitable for gyudon. Yorkbenimaru Co., a supermarket chain based in Tohoku, also highlighted this point and is eager to resume the sale of US beef. However, many retailers and restaurant operators remain cautious about buying in American beef. Ito-Yokado Co. has decided not to sell US beef for the time being, with a spokesperson saying: "It seems difficult to obtain understanding from customers." Aeon Corp. intends to watch the situation for a while, a staff member saying: "While giving priority to a sense of safety, we will decide whether to put the product on our shelves." 13) Consumer opposition steamrolled in decision to resume imports of US beef; Government maintains it is "carefully following procedures" MAINICHI (Page 2) (Excerpts) June 21, 2006 The expected agreement between Japan and the United States to resume imports of US beef comes in the form of steamrollering the deep-seated opposition of Japanese consumers. Although the government has concluded that it has fully followed procedures to reach a final decision, the resumption of imports is likely to leave most Japanese not quite satisfied. "I cannot at all sense that you have consumers' understanding," said one individual of an open hearing held by the government on June 14 to exchange views. Similar cautious views came one after the other. However, in the government's view, the issue was settled last year when the Food Safety Commission discussed the overall safety of US beef and made its risk evaluation. The judgment criteria for restarting US beef shipments center around whether the following two import conditions set by Japan can be kept: 1) limiting selection to cows under the age of 20 months; and 2) removing specified risk materials. The government will do no more than listen to any view that goes beyond that framework. Although prior inspections and surprise inspections have been accepted, the consumers continue to insist, "The US cannot be trusted." One can say that the discussions between the consumers and Japanese government were at cross purposes to the end. 14) Abe to announce his candidacy for LDP presidency in late TOKYO 00003440 010 OF 011 August, ascertaining moves of other possible candidates NIHON KEIZAI (Page 2) (Full) June 21, 2006 Chief Cabinet Secretary Shinzo Abe yesterday began coordination to put off announcing his candidacy for the September Liberal Democratic Party (LDP) presidential election until late August. He revealed that he would announce his candidacy probably after the mid-August G-8 summit in St. Petersburg, Russia. Based on the fact that he leads various opinion polls among the possible presidential candidates, he intends to carefully ascertain the moves of other contenders. He plans to publish a book containing his policy proposals in late July. He then aims to obtain cross- factional support. In late May, Abe essentially announced his candidacy for the LDP leadership race. He has at present an advantage over other candidates. An aide to Abe explained his strategy: "Putting off the announcement of his candidacy until last moment, he will make his move all at once." Abe intends to prioritize policy debate that is visible to the public rather than the hard work of gathering supporters after an early announcement of his candidacy. In the book to be published, he will introduce his comprehensive visions and policies for security, the economy, and education. He is expected to focus on such issues as constitutional revision, strengthening the Japan-US alliance, and respect for tradition and culture, which will be his main campaign pledges for the upcoming LDP presidential election. He will prepare for policy debate, making clear his own political identity in the policy front. 15) Ruling coalition concerned about backlash against BOJ governor; opposition to strengthen calls for resignation NIHON KEIZAI (Page 2) (Full) June 21, 2006 Learning yesterday that Bank of Japan Gov. Toshihiko Fukui's 10 million yen investment in the Murakami Fund had grown to 22 million yen as of the end of last year, the ruling and opposition camps are now stepping up criticism of him. No one from the government or ruling coalition has questioned his actions, but member after member expressed concern about a backlash from the public. Toranosuke Katayama, secretary general of the LDP caucus in the House of Councillors, pointed out: "I think ordinary people feel something is wrong. His conduct is not illegal, but he made a lot of money." Koichi Kato also made a critical comment: "It is only natural that average people envy him. I have to say that he was careless." House of Representatives member Keiichi Ishii of the New Komeito asked, "I wonder why he continued to hold the investment when he assumed the post of BOJ governor?" Ichiro Ozawa, president of the largest opposition party Minshuto (Democratic Party of Japan),stressed: "As the governor of the Bank of Japan, his conduct is dishonorable and questionable. He TOKYO 00003440 011 OF 011 should think seriously about his conduct in light of his position." Opposition parties intend to step up their pursuit of Fukui in a closed-door session on June 22 of the Lower House Financial Affairs Committee during the Diet recess, calling for his resignation. 16) Minshuto will not punish lawmaker Matsui NIHON KEIZAI (Page 2) (Excerpts) June 21, 2006 House of Representatives member Koji Matsui of Minshuto (Democratic Party of Japan) said yesterday that a company affiliated with the Murakami Fund had paid the salaries of his secretaries. However, the main opposition party yesterday decided SIPDIS not to punish Matsui. Party head Ichiro Ozawa stated in a press conference: "Sincerely explaining the facts, he has reflected on his conduct and is determined to fulfill his duty. The party has no intention to punish him." He indicated that Matsui has fulfilled his accountability. Matsui, at a press briefing yesterday in Kyoto, said that the company temporarily paid the salaries of two secretaries of his and that he would report a total of 1, 533,900 yen that the two secretaries had received to the government, based on the SIPDIS Political Fund Control Law. SCHIEFFER