JAPANESE MORNING PRESS HIGHLIGHTS 01/25/06

UNCLAS SECTION 01 OF 07 TOKYO 000375 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 01/25/06 Part-1 Index: 1) Top headlines 2) Editorials 3) Prime Minister's daily schedule 4) Deputy Secretary Zoellick in Beijing urges improvement in China's ties with Japan, focusing on history issue 5) Prime Minister Koizumi in Diet reply denies being chided by President Bush on Yasukuni Shrine visits 6) Japan to propose joint history study with China 7) Yamaha's Beijing affiliate helped Peoples Liberation Army learn to use illegal drone helicopter it exported to China 8) US announces stricter inspection regime for beef going to Japan in talks in Tokyo 9) Senior USDA officials stress safety of US beef, but no meeting of minds in bilateral talks in Tokyo 10) True feelings of USDA Under Secretary Penn slip out during press briefing Articles: 1) TOP HEADLINES Asahi, Mainichi, Yomiuri, and Tokyo Shimbun: Livedoor admits window-dressing; Financial chief Miyauchi points to Horie's involvement; Prosecutors to file charges against company for window-dressing; Livedoor Marketing evaluated Money Life's value six times its true worth Nihon Keizai: Top companies replaced in six digital appliance and information equipment items; Matsushita becomes No. 1 in plasma TV, and Sony in DVD recorder Sankei: Livedoor deleted 50,000 emails possibly to destroy evidence; Some not retrievable 2) EDITORIALS Asahi: (1)LDP's responsibility: Horie was supposed to be Takebe's "son" (2)Nago mayoral election: Political responsibility growing Mainichi: (1)Koizumi's Diet reply: Horie scandal not a separate matter (2)H-2A rocket: Successful launches a path to restoring trust Yomiuri: (1)Japan Post Corp.: President Nishikawa must re-read his proposals (2)Nago mayoral race: Futenma relocation issue must be pushed forward TOKYO 00000375 002 OF 007 Nihon Keizai: (1)Securities and Exchange Surveillance Commission needs more members and greater independence (2)NHK's management plan lacks drastic measures Sankei: (1)Diet interpellations: Why is the Livedoor scandal a separate matter? (2)Illegal attempt to export unmanned helicopter; Greater awareness for national security necessary Tokyo Shimbun: (1)Koizumi's Diet reply: "Separate matter" not appropriate (2)NHK reform: Public trust essential for broadcaster 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, January 24 NIHON KEIZAI (Page 2) (Full) January 25, 2006 08:01 Met at Kantei with Deputy Chief Cabinet Secretary Suzuki, followed by Deputy Chief Cabinet Secretary Nagase. 09:01 Attended cabinet meeting in Diet building. METI Minister Nikai remained in the room. Met with Environment Minister Koike. 10:01 Attended Upper House plenary session. 11:43 Returned to Kantei. 13:35 Met with Lower House member Yasufumi Tanahashi. 14:04 Attended Lower House plenary session. 16:26 Met at Kantei with Ambassador to Switzerland and Liechtenstein Abe and Ambassador to Croatia Shirakawa. Met afterwards with Indonesian Vice Minister Muhammad Yusuf Kalla. 17:12 Presented sumo grand champion Asashoryu with the prime minisrer's award of the Japanese professional sports grand prize. 17:48 Attended informal party at Hotel New Otani hosted by People's Political Association. 18:36 Returned to his official residence. 19:06 Met with LDP Secretary General Takebe, Upper House LDP Chairman Aoki, and New Komeito leader Kanzaki. 4) Zoellick reiterates hopes for improvement in Japan-China relations, focusing on historical issues, during talks with Chinese vice foreign minister ASAHI (Page 2) (Excerpts) January25, 2006 US Deputy Secretary of State Robert Zoellick, now visiting China, TOKYO 00000375 003 OF 007 said yesterday that historical issues pending between Japan and China had been taken up in his meeting with Chinese Vice Foreign Minister Dai Bingguo. In the US, concerns are growing that a decline in Japan's influence in Asia because of its strained relations with China and South Korea could undermine the United States' national interests. The issues of Tokyo's re-imposition of a ban on US beef imports and US force realignment also lie as a stumbling block between Japan and the US. Uncertainty is now looming large over relations between Japan and the US. In a press conference yesterday, Zoellick reiterated his expectation for improvement in Japan-China ties, saying: "Tensions are running between Japan and China, but the two countries share common interests in economic and many other areas." In a press conference in Japan on Jan. 23, Zoellick had proposed a joint study of the history of World War II by historians from Japan, the US and China. The proposal reflected his desire to reduce the tensions between Japan and China by Washington's involvement. But Chinese Foreign Ministry spokesman Kong Quan indicated a negative view about the proposal in the regular press briefing yesterday. Quan said: "The history of Northeast Asia has a specific nature. Relevant parties to this specificity are China, South Korea, and Japan." Seeing Tokyo unable to repair its ties with China, the US has begun to take different views toward it. A senior Japanese government official who recently visited the US commented: "In the US, an increasing number of finance officials in the Bush administration have voiced concern about a negative effect of the strained Japan-US ties on the Asian economy." At present, there are many issues pending between Japan and the US. On the issue of transferring US Marines in Okinawa, no progress has been made in negotiations between the US government and Japanese defense authorities. On US beef, Japan decided to re- impose a ban on imports only a month after Tokyo lifted its ban. If this issue is protracted, dissatisfaction with Japan might erupt again from the US Congress. 5) I have not received any criticism from US President over Yasukuni visits, says Koizumi at Diet TOKYO SHIMBUN (Page 2) (Full) January 25, 2006 The House of Representatives resumed a question-and-answer session regarding Prime Minister Junichiro Koizumi's policy speech and other matters during its plenary session yesterday afternoon. In response to a suggestion that the US government and the Congress are concerned about his visits to Yasukuni Shrine, the Prime Minister emphatically said: "I have not received any criticism from President Bush about my visits to Yasukuni Shrine. The US government understands my true intention behind my shrine visits." Koizumi was responding to Japanese Communist Party Executive TOKYO 00000375 004 OF 007 Committee Chairman Kazuo Shii, who stated: "The Japanese government has received a letter from House International Relations Committee Chairman Henry Hyde expressing his regret over the prime minister's series of visits to the shrine." Shii and Social Democratic Party Diet Affairs Committee Chairman Yasumasa Shigeno also repeatedly criticized the Liberal Democratic Party for backing former Livedoor President Takafumi Horie in last year's Lower House election. But Koizumi denied his responsibility as LDP president, saying, "(The arrest of Horie) and our support for him are two separate matters." 6) Government to propose launching joint history research during Japan-China vice ministerial dialogue on Feb. 10 NIHON KEIZAI (Page 2) (Full) January 25, 2006 The Japanese and Chinese governments agreed yesterday to hold a vice-foreign ministerial comprehensive policy dialogue in Tokyo on Feb. 10-11. In the meeting, Japan plans to propose launching joint research on history in fiscal 2006. Japan aims to set the stage for mending relations with China, which have been strained due to Prime Minister Junichiro Koizumi's visits to Yasukuni Shrine. A committee of historians of the two countries will be established to discuss ancient to modern history for several years to deepen mutual understanding. But the two countries may become increasingly at odds. Wrapping up three years of joint research, Japan and South Korea produced a report last June. The report listed the two countries' separate interpretations of the 1910 Japan-Korea Annexation Treaty as the opinions of the two sides had clashed over the validity of the pact. Vice Foreign Minister Shotaro Yachi and his Chinese counterpart Dai Bingguo will attend the comprehensive policy dialogue. Japan will request the resumption of mutual visits by Japanese and Chinese leaders and foreign ministerial talks. The two vice foreign ministers will also discuss the Yasukuni issue, the suicide of a Japanese diplomat at the consulate general in Shanghai, and reform of the United Nations. 7) Peoples Liberation Army possibly received robot helo training TOKYO SHIMBUN (Page 26) (Full) January 25, 2006 Beijing, Tohru Shiraishi Yamaha Motor Co., Ltd., headquartered in Iwata, Shizuoka Prefecture, is alleged to have attempted to illegally export industrial-use unmanned helicopters to China that can be diverted to military use. In this connection, BVE, a Beijing-based Chinese science and technology firm tied up with Yamaha, is suspected of having built a robot helicopter training base with the People's Liberation Army and conducted manipulation training, sources said yesterday. TOKYO 00000375 005 OF 007 According to Chinese media reports, including the electronic version of the Suzhou Daily, an organ newspaper of the Chinese Communist Party in Suzhou, Jiangsu Province, BVE's Suzhou branch and a PLA air force unit built China's first unmanned helicopter flight control training base at an airbase in Suzhou around December 2003. The base is believed to have been used in order for BVE engineers to conduct and demonstrate robot helo flight control training for air force personnel. In August 0221, BVE, tied up with Yamaha Motor, introduced Yamaha's industrial helicopter design and systems engineering. The company is said to have developed an unmanned helicopter under Yamaha's guidance and trained manipulators. Yamaha's technologies are also suspected of having been diverted to the Chinese military. BVE, working together with a Chinese research institution, has actually employed robot helicopters in aerosurveying, environment monitoring, border policing, and smuggling control and prevention, the Suzhou Daily says. 8) US beef issue: Government urges US to strengthen measures to prevent recurrence at bilateral working-level talks; US expresses its stance of stepping up inspection procedures NIHON KEIZAI (Page 5) (Full) January 25, 2006 The governments of Japan and the US yesterday held their first working-level talks at the Foreign Ministry, following the finding of the inclusion of spinal columns, which could contain high-risk mad cow disease materials, in a US beef shipment to Japan. During the meeting, the Japanese side urged the US to quickly find out why such materials were included in the shipment and take measures to prevent a recurrence. The US side, including Undersecretary of Agriculture J.B. Penn, indicated a stance of making efforts to beefing up the domestic inspection system. US officials once again offered an apology for the incident and said that the incident was a human-induced error. They then elaborated measures to prevent a recurrence through toughened safety control, including an increase in the number of inspectors and the implementation of sampling tests. At a press conference held the same day at the American Embassy, Penn offered an apology to Japanese consumers, saying, "The US would like to sincerely apologize to Japanese consumers." He then explained: "The violation occurred at a facility that has scant exporting experience. It is an isolated case." Penn said: "The spinal columns in question are defined as deemed safe according to international standards, but they are not authorized in Japan." He also noted: "The chance of being involved in a car accident when ONE is driving a car to a supermarket is greater than the chance of contracting a disease by eating beef." He played up the safety of US beef. He at the same time indicated his real feeling that he wanted Japanese consumers to act in a cool-headed manner. TOKYO 00000375 006 OF 007 The US will shortly present to Japan a report on the circumstances that have led to the violation of the bilateral agreement and measures to prevent a recurrence. The Ministry of Agriculture, Forestry and Fisheries and the Ministry of Health, Labor and Welfare will scrutinize it and then decide to lift the import ban, if they reach a judgment that the safety of US beef has been confirmed. However, since the removal of the ban will require understanding and support from a broad spectrum of concerned parties, such as political circles and consumers, the government will likely find it difficult to handle the matter. 9) Second ban on US beef imports: US stresses safety of its beef at bilateral bureau director-level meeting, but differences in safety consciousness exposed TOKYO SHIMBUN (Page 9) (Full) January 25, 2006 Following the halting of imports of US beef due to the inclusion of specified risk materials (RSM) for bovine spongiform encephalopathy in a Japan-bound shipment, the governments of Japan and the US yesterday held a bureau director-level meeting at the Ministry of Foreign Affairs (MOFA) in Kasumigaseki, Tokyo. During the meeting, the Japanese side urged the US to thoroughly investigate the cause of the incident and take measures to prevent a recurrence. After the meeting, the US stressed the safety of US beef, presenting measures intended to prevent a recurrence, which had already been released, while reiterating its apology for the incident. The meeting revealed differences in safety consciousness of the incident between Tokyo and Washington. The meeting brought together MOFA Economic Affairs Bureau Director General Kaoru Ishikawa, Ministry of Agriculture, Forestry and Fisheries (MAFF) Food Safety and Consumer Affairs Bureau Director General Hiroshi Nakagawa and Ministry of Health, Labor and Welfare (MHLW) Pharmaceutical and Food Safety Bureau Director General Yoshiyuki Matsumoto from the Japanese side and Under Secretary of Agriculture J.B. Penn and Deputy Under Secretary of Agriculture Chuck Lambert from the US side. SIPDIS The US side reported to the Japanese participants that it had removed the two facilities involved in the violation from the list of beef exporters to Japan. It then explained the outline of 12-item measures to toughen inspections, which it released on Jan. 20. The Japanese side responded: "Since the cause of the incident has yet to be found out, we cannot immediately judge whether the US' measures to strengthen safety inspections are appropriate or not." Emerging from the meeting, Nakagawa told reporters, "What is important is what has caused that incident. We believe it is vital for the US to employ appropriate measures, based on the results of the investigation." In the meantime, Penn at a press conference held at the US Embassy made an apology for the incident, but insisted: "The meat processing company involved was recently put on the list of beef exporters to Japan. It is not well versed in international trade. The incident this time is an isolated case." Underscoring that US TOKYO 00000375 007 OF 007 beef is safe, he noted that the US would continue to ask Japan to further ease import standards, if imports of its beef resume, following the recovery of trust of Japanese consumers in US beef. 10) US Under Secretary of Agriculture lets his real feeling slip out: Chance of being hit by a car greater than chance of coming down with BSE TOKYO SHIMBUN (Page 9) (Full) January 25, 2006 Meeting the press after the Japan-US bureau director-level meeting, US Under Secretary of Agriculture J.B. Penn yesterday stressed the safety of US beef. He noted: "The chance of being involved in a car accident when ONE is driving a car to a supermarket is greater than contracting a disease, by eating beef." Though the US remains apologetic for the inclusion of specified risk materials (RSM) in its beef shipment to Japan, Penn apparently let what he really felt slip out. He urged Japan to take a balanced stance and view the matter from a scientific perspective. His statement, however, could upset Japanese consumers, who are sensitive to food safety. Secretary of Agriculture Mike Johanns made a similar statement SIPDIS when the second case of BSE was discovered in the US last June, by comparing the incident to a traffic accident. SCHIEFFER