DAILY SUMMARY OF JAPANESE PRESS 06/28/06

UNCLAS SECTION 01 OF 09 TOKYO 003580

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SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 06/28/06


INDEX:

(1) Poll on Koizumi cabinet, political parties, LDP race, BOJ
chief's investment

(2) Okinawa gov. to step down this fall

(3) Editorial: Japanese, US leaders should give strong warning to
North Korea

(4) Editorial: US-India nuclear pact raises questions about
sustainability of nuclear nonproliferation framework

(5) WTO ministerial to kick off on June 29; Drafting modality
agreement to come to crucial stage; US concessions hold key

(6) Three-party talks on Japan's policy stance in WTO talks confirm
unity prior to ministerial; Japan to call for realistic level of
tariff cuts

(7) Agricultural trade panel Acting Chairman Oshima expresses
willingness to back up Nakagawa's efforts in WTO ministerial

(8) Editorial: US should become less "ambitious"

(9) WTO ministerial meeting to kick off on June 29; Gap between US
and Japan-EU on camp remains; Agreement before year's end appears
difficult

ARTICLES:

(1) Poll on Koizumi cabinet, political parties, LDP race, BOJ
chief's investment

ASAHI (Page 4) (Full)
April 25, 2006

Questions & Answers
(Figures shown in%age, rounded off. Bracketed figures denote
proportions to all respondents. Parentheses denote the results of
the last survey conducted May 20-21.)

Q: Do you support the Koizumi cabinet?

Yes 45 (45)
No 41 (39)

Q: Why? (One reason only. Left column for those marking "yes" on
previous question, and right for those saying "no.")

The prime minister is Mr. Koizumi
21(9) 7(3)
The prime minister is from the Liberal Democratic Party
15(6) 8(3)
From the aspect of policies
37(17) 59(24)
Because of the coalition government
8(3) 13(5)
No particular reason
17(8) 12(6)

Q: Which political party do you support now?


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Liberal Democratic Party (LDP) 35 (34)
Democratic Party of Japan (DPJ or Minshuto) 20 (19)
New Komeito (NK) 3 (3)
Japanese Communist Party (JCP) 2 (2)
Social Democratic Party (SDP or Shaminto) 1 (2)
People's New Party (PNP or Kokumin Shinto) 0 (0)
New Party Nippon (NPN or Shinto Nippon) 0 (0)
Liberal League (LL or Jiyu Rengo) 0 (0)
Other political parties 0 (1)
None 33 (37)
No answer + don't know 6 (2)

Q: Are you interested in the LDP presidential election scheduled for
this September?

Yes 59
No 39

Q: As likely candidates for the next prime minister, there are now
some names coming up, such as Mr. Taro Aso, Mr. Shinzo Abe, Mr.
Sadakazu Tanigaki, and Mr. Yasuo Fukuda. Who do you think is
appropriate for the next prime minister?

Taro Aso 5 (3)
Shinzo Abe 45 (41)
Sadakazu Tanigaki 3 (1)
Yasuo Fukuda 25 (29)
Other persons 12 (16)

Q: (Only for those who named one of the four persons) Why? (One
choice only)

His policy and opinions are good 19 (15)
He seems to be a man of action 32 (25)
His personal character and image are good 46 (36)

Q: (Only for those who named one of the four persons) Do you think
you know well about the person you chose, or do you just recognize
the person or know the person's name?

Know well
31 (24)
Just recognize the person and knows the person's name
66 (51)

Q: Would you like the next prime minister to continue Prime Minister
Koizumi's structural reforms? Would you like the next prime minister
to reconsider Prime Minister Koizumi's way of doing things, or would
you otherwise like the next prime minister to change it?

Continue 17
Reconsider 54
Change 23

Q: Do you have expectations for DPJ President Ichiro Ozawa?

Yes 45
No 48

Q: Bank of Japan Governor Fukui has profited from his investment of
10 million yen in the Murakami Fund. The BOJ head is in a position
to determine Japan's monetary policy. What do you think about his
investment for such profit-making purposes?

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It's a problem 80
It's not a problem 15

Q: Do you think it hurts public trust in the BOJ's monetary policy?

Yes 70
No 25

Q: Do you think Mr. Fukui should resign as BOJ governor?

Yes 67
No 25

Polling methodology: The survey was conducted June 24-25 over the
telephone on a computer-aided random digit dialing (RDD) basis. This
RDD formula chooses persons for the survey from among all eligible
voters throughout the nation on a three-sage random-sampling basis.
Valid answers were obtained from 1,965 persons (53% ).

(2) Okinawa gov. to step down this fall

RYUKYU SHIMPO (Page 1) (Abridged)
June 28, 2006

Okinawa Prefecture's Governor Keiichi Inamine, now determined not to
run in this September's gubernatorial election for a third term,
will formally announce in a meeting of the prefectural assembly
tomorrow that he will retire, an aide to the governor revealed
yesterday. Now that the governor will clarify his retirement, the
ruling parties will likely expedite their screening committee's
narrowing down of post-Inamine candidates for the election. There
are now 13 recommended candidates on the ruling bloc's list.

The ruling camp intended to select a final candidate by the end of
June but is now behind in screening the candidates. The ruling
parties and the governor's backers had therefore expected the
governor to avoid announcing his retirement before they can decide
on one candidate. The screening committee asked the governor on June
25 to abstain from announcing his retirement during the prefectural
assembly's June session.

At the committee's request, Inamine considered foregoing his
announcement of retirement before the prefectural assembly in its
June session. However, the governor has now made up his mind to
clarify his retirement. The governor probably thought to himself
that a belated announcement of retirement could cause the electorate
to misunderstand that he may run in the election and that such a
misunderstanding could affect the screening of candidates.

(3) Editorial: Japanese, US leaders should give strong warning to
North Korea

SANKEI (Page 2) (Full)
June 28, 2006

Prime Minister Junichiro Koizumi departed for Canada and the United
States. He is expected to meet with US President George W. Bush on
June 29 in Washington.

One of main topics of their discussion is how to respond to North
Korea, which has continued preparations for launching a Taepodong-2
long-range ballistic missile. If the North launches it, Japan and

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the US should give Pyongyang a strong warning to immediately end the
missile threat, showing their determination to invoke sanctions.

It is certain that Japan will suffer if Pyongyang launches a
missile. When the North launched a Taepodong-1 missile in 1998, a
booster, the first part of the missile, fell into the Sea of Japan,
and a booster and warhead from the second part dropped into waters
off the Sanriku coast. The outer part of the top of the missile's
second part fell into waters about 60 kilometers from Japanese
territorial waters. If the North launches a Taepodong-2, the
possibility of a warhead falling on Japan cannot be dismissed.

What the missile carries is "unknown," according to President Bush.
The Japanese government does not need to worry, but it should face
the fact that North Korea has physical means of threatening the
Japanese public. At the same time, the government should take
measures in response to any act violating its sovereignty.

Prime Minister Koizumi stated that it would be better not to reveal
what kind of measures Japan would take, while stressing that he
would respond harshly if Pyongyang were to test a missile.

Late last year, the government indicated that Japan had no choice
but to impose economic sanctions unless North Korea responded
sincerely on the abduction issue. The government, however, has not
imposed any economic sanctions. What has made Koizumi hesitate to do
so? It is clear that a missile launch would violate the 2002
Japan-North Korea Pyongyang Declaration. By taking a firm stand, the
prime minister would be able to send an appropriate message warning
North Korea.

Japan's missile defense system will go online next year or later.
Until then, Japan has not choice but to entrust its security to US
military's deterrence. Two US Aegis destroyers capable of detecting
and attacking missiles have already been deployed in the Sea of
Japan.

Koizumi and Bush will confirm in their meeting that Japan and the
United States will strengthen their alliance. Looking at the severe
situation in the world, they should take advantage of their summit
to make the bilateral ties move one step forward.

(4) Editorial: US-India nuclear pact raises questions about
sustainability of nuclear nonproliferation framework

YOMIURI (Page 3) (Full)
June 28, 2006

How Japan should respond to the US-India pact on civilian nuclear
cooperation is a significant issue for Japan's nuclear policy.

The US Congress has started discussions on a revision of the law to
enable the United States and India to cooperate on nuclear power.

In a hearing at Congress, Secretary of State Condoleezza Rice
explained two points as reasons for the need for US-India nuclear
cooperation, namely that strategic ties would be strengthened and
that the international nuclear nonproliferation framework would be
solidified.

For the United States, the pact has significant strategic meaning:
It would constrain China, ensure energy security, and allow the
entry of US nuclear firms into the Indian market.

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It is also true that the International Atomic Energy Agency (IAEA)
will be able to inspect most of India's nuclear facilities.

Indian Prime Minister Singh promised US President George W. Bush in
March that India would accept IAEA inspections of civilian nuclear
facilities. Bush also promised Singh that the United States would
promote civilian nuclear cooperation, such as construction of
nuclear power plants and the supply of nuclear fuel.

The US-India agreement approves India's possession of nuclear
weapons. India, without joining the Nuclear Nonproliferation Treaty
(NPT),will obtain its benefits -- nuclear cooperation for peaceful
use.

The NPT imposes strict regulations on the peaceful use of nuclear
energy. The treaty allows only five countries -- the United States,
Britain, France, Russia, and China -- to have nuclear arms, calling
on other member countries to abandon development of nuclear weapons
and requiring them to accept IAEA inspections. The treaty allows
them to use nuclear energy for peaceful purposes in return.

Giving special treatment to India, which is not a party to the NPT,
might shake the credibility of the treaty.

North Korea and Iran might use the US-India accord as an excuse for
their backward-looking stance and opposition to IAEA inspections.

Will India sign or ratify the Comprehensive Test Ban Treaty (CTBT)?
How will India deal with negotiations on the Cutoff Treaty, which
bans the production of highly enriched uranium and other nuclear
materials?

In a meeting of the 45-nation-member nuclear supply group (NSG),to
which Japan belongs, the US government has sought to apply to India
the guidelines prohibiting exports of nuclear materials and
technology to countries that do not allow strict inspections.

If a standoff deepens between NSG members supporting Washington's
proposal and member countries opposing it, the NSG will fail to
function. If so, the nuclear nonproliferation system will weaken.
Without making clear how to link the US-India accord to the
maintaining of the nuclear nonproliferation framework, it is
unreasonable for the United States to cooperate on nuclear power
with a nuclear weapons state that is a non-NPT member.

(5) WTO ministerial to kick off on June 29; Drafting modality
agreement to come to crucial stage; US concessions hold key

Japan Agricultural News (Top Play) (Full)
June 29, 2006

In a bid to reach a modality agreement (guidelines for reducing
trade protection) on the agricultural sector, discussions on which
are destined to run into snags, the World Trade Organization (WTO)
will hold a meeting of some member nations from June 29. With
exporting and importing countries remaining at odds over this issue,
there is no knowing whether such an agreement can be reached or not.
How the US, which has major influence, will move will hold the key
to negotiations.

Ministerial-level officials from 30 to 40 countries, including the
US, the EU, Brazil, and India, are expected to attend the meeting

TOKYO 00003580 006 OF 009


with the aim of having their views reflected in modalities. Talks on
sectors other than agriculture will also take place.

The agricultural talks will be pursued based on the draft modalities
presented on the 22nd. On many points, the draft simply listed views
presented by various countries and groups. The talks will,
therefore, likely aim at finding a breakthrough with a focus on
major agenda items, including the rate of cuts in tariffs, the
number of key trade items and the handling of such, and the rate of
cuts in domestic subsidies.

The expectation is that if the upcoming ministerial meeting fails to
find a breakthrough, it will be extremely difficult to conclude the
Doha Round (multilateral trade talks) before year's end. Because of
this situation, participating countries and territories have hinted
that they are ready to make concessions to some extent. In
particular, how the US will move is drawing attention from various
countries.

Shoichi Nakagawa, Minister of Agriculture, Forestry, and Fisheries,
after appearing on a TV talk show expressed strong interest in a
series of US statements that hinted at its readiness to make
concessions. He noted, "I cannot tell whether the US is serious,
whether this represents progress, or whether they are just faking."

With the off-year election close at hand in November, the US is in a
situation where it finds it politically difficult to make
concessions. Nevertheless, it is possible to assume that some kind
of political decision by the US would prompt Japan and the EU to
make a compromise, moving the stalemated talks forward.

However, even if the US were to make concessions, they could be no
more than marginal. The Japanese government is closely watching how
the US will move, as one government source noted: "The US might try
to play up small concessions. It is necessary to wait and see
whether what the US calls concessions are really that for other
countries as well."

(6) Three-party talks on Japan's policy stance in WTO talks confirm
unity prior to ministerial; Japan to call for realistic level of
tariff cuts

NIHON NOGYO SHIMBUN (Full)
June 27, 2006

Prior to the planned World Trade Organization (WTO) ministerial
meeting to be held in Geneva, Switzerland, with a view to setting
modalities (standards for protection cuts),representatives from the
Liberal Democratic Party (LDP),the government, and the Ministry of
Agriculture, Forestry, and Fisheries (MAFF) decided on Japan's
policy stance in their meeting at LDP headquarters yesterday. In the
meeting, MAFF Minister Shoichi Nakagawa indicated his determination
to do his best to have rules reflecting the stance of importer
nations laid down, saying: "Japan will protect what should be
protected. In the talks, I will make utmost efforts with the help of
the party and agricultural groups."

MAFF officials explained that Japan will take a positive stance in
the talks on strengthening cooperation with the nine other major
food-importing economies (G-10). In the thorny market-access area,
Japan will call for setting realistic levels for tariff cuts and
oppose the proposed introduction of tariff caps.


TOKYO 00003580 007 OF 009


Before leaving for Geneva as chairman of the LDP delegation in
conjunction with the WTO ministerial, LDP Research Commission on
comprehensive Agriculture Chairman Yoshio Yatsu said: "We will
indirectly support the ministerial talks." JA Central Union of
Agricultural Cooperatives Chairman Isao Miyata emphatically said:
"We will tenaciously work in cooperation with agricultural groups
from the other G-10 members."

(7) Agricultural trade panel Acting Chairman Oshima expresses
willingness to back up Nakagawa's efforts in WTO ministerial

NIHON NOGYO SHIMBUN (Full)
June 27, 2006

LDP Research Commission on Trade in Agricultural, Forestry, and
Fisheries Products Acting Chairman Tadamori Oshima said in a WTO
meeting of representatives from the government, the Liberal
Democratic Party, and agricultural groups yesterday: "We expect
Agriculture, Forestry, and Fisheries Minister Nakagawa will make
utmost efforts. I hope he will take care of himself and do his
best." Oshima thus encouraged Shoichi Nakagawa prior to his
departure (for Geneva) to attend the WTO ministerial as a
representative of the Japanese government. He also revealed the
party's plan to dispatch a delegation to offer indirect support,
saying: "We don't know what difficulties lie ahead under this severe
situation. We will back up Minister Nakagawa in cooperation with
agricultural organizations."

(8) Editorial: US should become less "ambitious"

NIHON NOGYO SHIMBUN (Page 13) (Full)
June 23, 2006

In agriculture talks under the World Trade Organization (WTO),
negotiations on modalities will come to the crucial stage from late
this month through early next month. The JA group will hold a WTO
national rally in Tokyo today, with the aim of preventing an upper
limit from being set on tariff rates on mainstay farm products. The
group is pursuing the policy of "coexistence of diverse forms of
agriculture." In the process of establishing modalities (standards
for protection cuts),this global desire must be respected.

A ministerial meeting on farm products will be held in Geneva,
Switzerland, where the WTO headquarters is located. Agriculture,
Forestry, and Fisheries Minister Shoichi Nakagawa will also
participate in the meeting in an effort to establish modalities, but
difficult negotiations are foreseen, as the United States has stuck
to its proposal giving priority to its own interests. The proposal
is lenient on the US but severe for other countries.

The US proposal is overly "ambitious." The world's largest food
exporter proposes that tariffs on general products should be reduced
by up to 90%. The US has continued to refuse to pull back this
proposal designed to completely remove tariffs. Such a stance is
tantamount to an attempt to destroy the Japanese and other
importers' agriculture industry and is quite high-handed.

Under the current system, the margin of reduction in tariff rates on
mainstay farm products is set at a low level. The US, however,
insists that the ratio of key products to all products should be
kept at only 1%, while Japan on behalf of the Group of 10 (10
food-importing economies) calls for 15%, including rice, wheat,
dairy products, sugar, and starch. The 1% proposal is extreme.

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The US is also maneuvering to introduce a tariff cap system for
mainstay farm products and lower tariff rates to below 75%. Under
this proposal, Japan's current 778% tariff rate on imported rice
would be reduced to less than one-tenth.

Food-exporting economies under the lead of the US propose that
low-tariff import quotas for farm products be expanded as
compensation for the high tariffs on mainstay products. For
instance, Japan is mandated to import 767,000 tons of rice under the
so-called minimum access formula. If the proposal is adopted, Japan
will be required to import one to five million tons more of rice.

The chairman of the agricultural talks, in a bid to set modalities,
has urged the member countries to coordinate views based on the
proposal made by the group of 20 potential developing countries
(G-20),including Brazil. But the G-20 proposal is extremely close
to the US proposal, and Japan cannot accept it. The JA group has
expressed "absolute opposition."

The US, Brazil, Australia, and other food-exporting economies should
be aware that as long as the principle of "coexistence of diversity
in agriculture," as called for by Japan and other many importers, is
not reflected, modalities will never be established. Importers also
should make significant concessions if they want to see the talks
end successfully. The agricultural talks have reached an important
phase. Set off by the WTO national rally by the JA group today, the
importer nations should reiterate the need for coexistence and
strengthen cooperation within and outside the nation so as not to
allow exporter nations to take act as they like.

(9) WTO ministerial meeting to kick off on June 29; Gap between US
and Japan-EU on camp remains; Agreement before year's end appears
difficult

NIHON KEIZAI (Page 5) (Excerpts)
June 27, 2006

Multilateral trade talks (Doha round) at the World Trade
Organization (WTO) have entered the home stretch. A ministerial
meeting is to take place in Geneva, Switzerland, starting on June
29, with the aim of reaching a consensus on trade liberalization
rules for agricultural goods and mined and manufactured products.
The growing view is that it will be difficult to reach a consensus
with the US seeking substantial market liberalization and Japan and
European countries wishing to constrain the margin of tariff cuts.

The ministerial meeting will have the participation of about 40
countries and territories, including Japan, the US, and European
countries. Minister of Economy, Trade, and Industry Toshihiro Nikai
and Minister of Agriculture, Forestry, and Fisheries Shoichi
Nakagawa will represent Japan.

In the agricultural sector, the US is seeking an average 66% tariff
cut, creating a division with Japan, which wants the margin of such
a cut to be no more than 28%, and the EU, which wants a 41%
reduction. The US is being urged to substantially cut its
agricultural subsidies. Brazil and some other countries that want to
increase exports to industrialized countries have been asking for
cuts on mined and manufactured products. The agricultural talks are
showing signs or becoming a three-sided or even a four-sided fight.

On June 23, the chairman presented a set of proposals for both the

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agriculture and mined and manufactured sectors, which are to form
the basis for the ministerial meeting. The contents of the package
were no more than the list of arguments already presented by various
countries. Coordination of views is needed on about 700 items,
including the rates of reductions in tariffs.

The US, a food exporting country, holds the key to the fate of the
talks. It has been decided that modified rates will be applied to
some products, including Japan's rice, as exceptions. The US has
called for holding the number of items treated as exceptions to 1%
of all items. It is also calling for capping tariff rates on such
exceptional items at 75%. Japan, which imposes a 778% tariff on
rice, and the EU are opposing the US proposal as unrealistic.

Chances are that if the talks bog down, the US may be criticized as
the culprit. However, some suspect that the US, which is unable to
move with the midterm election close at hand, might make concessions
within narrow limits, thereby blaming Japan and European countries
in the event the talks break down. Should that occur, Japan would
bear the brunt of criticism for having opened its agriculture market
only on a piecemeal basis.

Unless progress is made to some extent, it will be impossible to
discuss other subjects, such as the services sector and assistance
to developing countries. If that happens, it would be hopeless to
reach a final agreement at year's end. The Trade Promotion Authority
that the US Congress has granted to the Bush administration will
expire next July. According to a government source, if that happens,
it will take one or two years for the US government to be ready to
pursue trade negotiations, meaning that trade talks will be
effectively put on hold. There is fear in Japan of losing
opportunities to expand trade with developing countries.

DONOVAN