Identifier
Created
Classification
Origin
06TOKYO851
2006-02-16 08:08:00
UNCLASSIFIED
Embassy Tokyo
Cable title:  

DAILY SUMMARY OF JAPANESE PRESS 02/16/06

Tags:  OIIP KMDR KPAO PGOV PINR ECON ELAB JA 
pdf how-to read a cable
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UNCLAS SECTION 01 OF 09 TOKYO 000851 

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: DAILY SUMMARY OF JAPANESE PRESS 02/16/06

INDEX:

(1) US Ambassador to Japan urges positive approach to US-Japan
FTA

(2) Minshuto member: Livedoor Horie instructs staff by e-mail to
send 30 million yen to Takebe's second son

(3) Pinning hopes on post-Koizumi candidates; Beijing accepts
visits to China by ruling party executives with aim of improving
relations with Japan

(4) Sozo presents US Consul General with its own US force
realignment plan

(5) CEFP agrees to set global strategy in May

(6) South Korean Foreign Affairs & Trade Minister Ban joins race
for UN top post; Ban "expects Japan's support," but Japan says,
"It's difficult..."

(7) One year since Kyoto Protocol went into effect: Only 19 local
governments establish surveillance system to check greenhouse gas
emissions by companies

(8) LDP Constitutional Research Commission Chairman Hajime Funada
says LDP will come up with second draft constitution including
many views in the party, new LDP president should show the way to
constitutional reform

(9) Amakudari is stymieing structural reform

ARTICLES:

(1) US Ambassador to Japan urges positive approach to US-Japan
FTA

NIHON KEIZAI (Page 2) (Full)
Evening, February 16, 2006

Speaking this morning before a meeting of Otemachi Trading
Company heads, American Ambassador to Japan J. Thomas Schieffer
took a stance of urging a positive approach toward a US-Japan
fair trade agreement (FTA) by saying, "If economic liberalization
advances, it would create new demand and generate more
employment." Japan Foreign Trade Council Chairman Sasaki
(Mitsubishi Trading Company) commented, "Although there are some
difficult issues such as agriculture remaining between the US and
Japan, it would be a good to (sign an FTA),taking a mid to long
term perspective."

(2) Minshuto member: Livedoor Horie instructs staff by e-mail to
send 30 million yen to Takebe's second son

ASAHI (Top Play) (Excerpt)
Evening February 16, 2006

In a House of Representatives Budget Committee meeting yesterday,
Democratic Party of Japan (Minshuto) Hisayasu Nagata said that
former Livedoor President Takafumi Horie, who has been indicted
on charges of violating the Securities Exchange Law, had
instructed a company employee by e-mail on Aug. 26 of last year
to send money to the second son of Liberal Democratic Party

TOKYO 00000851 002 OF 009


Secretary General Tsutomu Takebe: According to Nagata, Horie sent

SIPDIS
e-mail noting: "Make arrangements to transfer 30 million yen to
the same bank account as in the previous case. Enter election
consulting fees as the purpose of the expenditure." Nagata
demanded that Takebe and his second son should be summoned as an
unsworn witness. Meanwhile, speaking to reporters in the Diet
building, Takebe rejected the allegation as untrue.

(3) Pinning hopes on post-Koizumi candidates; Beijing accepts
visits to China by ruling party executives with aim of improving
relations with Japan

YOMIURI (Page 4) (Full)
February 16, 2006

Groups of lawmakers, including ruling party executives, are
scheduled to visit China one after another soon with a view to
improving relations between Japan and China, which have soured
due to Prime Minister Junichiro Koizumi's visits to Yasukuni
Shrine and other factors. Beijing has decided to accept visits to
China by senior ruling party members, reversing its previous
policy. Beijing has also begun exhibiting its stance of pinning
greater hopes on possible successors to Koizumi than on the
Koizumi cabinet.

On Feb. 19, Liberal Democratic Party Policy Research Council
Chairman Hidenao Nakagawa and his New Komeito counterpart
Yoshihisa Inoue will visit China. On March 30, representatives of
seven Japan-China friendship organizations, including former
Prime Minister Ryutaro Hashimoto, former Home Affairs Minister
Takeshi Noda (who is also chairman of the Japan-China
Association),and former Foreign Minister Masahiko Komura, are
scheduled visit China. Furthermore, talks with Chinese President
Hu Jintao are scheduled for the group including Hashimoto, which
will be accompanied by Chinese Ambassador to Japan Wang Yi.

Beijing has been reluctant to accept visits by Japanese lawmakers
since a series of anti-Japan demonstrations last spring. Although
China accepted visits by Minshuto (Democratic Party of Japan)
President Seiji Maehara and Social Democratic Party head Mizuho
Fukushima in December, visits by senior ruling party members have
not realized.

China's new stance has raised concerns in Japan. A junior LDP
member speculated, "By placing Prime Minister Koizumi out of the
loop, China is trying to affect the post-Koizumi race and Japan's
public opinion."

Noda delivered a speech in Tokyo yesterday in which he said,
"When I met with Chinese State Councilor Tang Jiaxuan, a former
foreign minister, in Beijing, he told me, 'We cannot expect
relations with Japan to turn for the better as long as Prime
Minister Koizumi remains in office. We place expectations on
Koizumi's successor.'" Noda also said, "The question of paying
homage at Yasukuni Shrine and policy toward China are important
factors in considering the successor to Prime Minister Koizumi."

Before the Japan-China Parliamentarian Friendship Association,
Chinese Ambassador Wang reiterated concern yesterday over visits
to Yasukuni Shrine by the Japanese prime minister, saying, "Any
political impediments (to the relationship between Japan and
China) must be eliminated." During his stay in Japan, the
Association's Vice Chairman Jing Dunquan held talks with Chief

TOKYO 00000851 003 OF 009


Cabinet Secretary Shinzo Abe on Feb. 13 and with Foreign Minister
Taro on the 14th. Those meetings have also sparked speculation
that the purpose was to size up possible successors to Koizumi.

(4) Sozo presents US Consul General with its own US force
realignment plan

OKINAWA TIMES (Page 3) (Full)
February 16, 2006

A group of members of Okinawa political group Sozo (headed by
Mikio Shimoji),including Acting Representative Hiroshi Goya,
Secretary General Chohei Maekawa, and Policy Research Council

SIPDIS
Chairman Morio Toma, held talks yesterday with US Consul General
for Okinawa Thomas Reich at the Consulate General in Urasoe. In
the meeting, the group presented its own plan to build a helipad
on the coastline of Camp Schwab in Nago as part of the planned US
force realignment.

Sozo's plan is designed to immediately close down the US Marine
Corps' Futenma Air Station to build a 300-meter-by-300-meter
helipad at Camp Schwab. The group also explained a plan to
temporarily shift part of functions of the Futenma airfield to
Kadena Air Base once its military strength, such as fighters, is
reduced.

Consul General Reich welcomed the proposal, saying, "This is the
first case we have received a counter-plan from local residents
in the course of bilateral talks on US force realignment." At the
same time, citing an agreement specified in an US force
realignment interim report to build a 1,800-meter runway on the
coastline of Camp Schwab, the Consul General said: "An agreement
has been reached on the need to build a runway in constructing
the alternative facility. Questions remain if such a helipad can
be the alternative facility."

Reich also revealed a negative view about substantially reducing
the military strength of Kadena Air Base, noting:

"The importance of Okinawa is increasing due to North Korea's
nuclear ambitions and China's military buildup. The military
functions of Kadena Air Base are particularly indispensable."

Maekawa sought US understanding, stating:

"Seventy to eighty percent of Okinawa residents are opposed to
the coastal relocation plan. The United States should lend an ear
closely to the voices of the Okinawa public who have been
suffering from US bases for the last 60 years."

(5) CEFP agrees to set global strategy in May

YOMIURI (Page 9) (Full)
February 16, 2006

The Council on Economic and Fiscal Policy (CEFP) yesterday agreed
to compile a global strategy in order for the government to
strengthen Japan's international competitiveness. The panel will
look into the possibility of expanding the framework for skilled
and able foreign workers, developing a comprehensive strategy for
the improvement of international competitiveness of the
agriculture, fisheries and forestry industries and promoting
efforts to sign economic partnership agreements (EPA).

TOKYO 00000851 004 OF 009



(6) South Korean Foreign Affairs & Trade Minister Ban joins race
for UN top post; Ban "expects Japan's support," but Japan says,
"It's difficult..."

NIHON KEIZAI (Page 2) (Full)
February 15, 2006

South Korean Foreign Affairs & Trade Minister Ban Ki-moon who has
declared his candidacy for the top post of the United Nations
indicated at a press conference on Feb. 14 that he hoped Japan
would support him, saying: "I'm happy to hear of Japan's position
that an Asian candidate should fill the post." Speaking of how to
respond to North Korea's nuclear development programs, Ban
stressed: "If I were elected, I would play a positive role to
resolve the issue peacefully and swiftly." (Hiroshi Minegishi,
Seoul)

The Japanese government has taken a cold attitude toward Ban's
statement. South Korea has been opposed to Japan's long-cherished
desire to become a permanent member of the UN Security Council. A
senior Foreign Ministry official said flatly: "Only when it's
convenient for them do so, they ask for our support. But giving
support is difficult."

Asked by reporters whether to back Ban, Prime Minister Junichiro
Koizumi said innocuously: "Isn't it too early to decide?" Chief
Cabinet Secretary Shinzo Abe told the press, "An Asian candidate
should be elected," but he added: "We'd like to make a decision
from a comprehensive standpoint, for instance, considering
progress in the UN reform."

(7) One year since Kyoto Protocol went into effect: Only 19 local
governments establish surveillance system to check greenhouse gas
emissions by companies

MAINICHI (Page
UNCLAS SECTION 01 OF 09 TOKYO 000851

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: DAILY SUMMARY OF JAPANESE PRESS 02/16/06

INDEX:

(1) US Ambassador to Japan urges positive approach to US-Japan
FTA

(2) Minshuto member: Livedoor Horie instructs staff by e-mail to
send 30 million yen to Takebe's second son

(3) Pinning hopes on post-Koizumi candidates; Beijing accepts
visits to China by ruling party executives with aim of improving
relations with Japan

(4) Sozo presents US Consul General with its own US force
realignment plan

(5) CEFP agrees to set global strategy in May

(6) South Korean Foreign Affairs & Trade Minister Ban joins race
for UN top post; Ban "expects Japan's support," but Japan says,
"It's difficult..."

(7) One year since Kyoto Protocol went into effect: Only 19 local
governments establish surveillance system to check greenhouse gas
emissions by companies

(8) LDP Constitutional Research Commission Chairman Hajime Funada
says LDP will come up with second draft constitution including
many views in the party, new LDP president should show the way to
constitutional reform

(9) Amakudari is stymieing structural reform

ARTICLES:

(1) US Ambassador to Japan urges positive approach to US-Japan
FTA

NIHON KEIZAI (Page 2) (Full)
Evening, February 16, 2006

Speaking this morning before a meeting of Otemachi Trading
Company heads, American Ambassador to Japan J. Thomas Schieffer
took a stance of urging a positive approach toward a US-Japan
fair trade agreement (FTA) by saying, "If economic liberalization
advances, it would create new demand and generate more
employment." Japan Foreign Trade Council Chairman Sasaki
(Mitsubishi Trading Company) commented, "Although there are some

difficult issues such as agriculture remaining between the US and
Japan, it would be a good to (sign an FTA),taking a mid to long
term perspective."

(2) Minshuto member: Livedoor Horie instructs staff by e-mail to
send 30 million yen to Takebe's second son

ASAHI (Top Play) (Excerpt)
Evening February 16, 2006

In a House of Representatives Budget Committee meeting yesterday,
Democratic Party of Japan (Minshuto) Hisayasu Nagata said that
former Livedoor President Takafumi Horie, who has been indicted
on charges of violating the Securities Exchange Law, had
instructed a company employee by e-mail on Aug. 26 of last year
to send money to the second son of Liberal Democratic Party

TOKYO 00000851 002 OF 009


Secretary General Tsutomu Takebe: According to Nagata, Horie sent

SIPDIS
e-mail noting: "Make arrangements to transfer 30 million yen to
the same bank account as in the previous case. Enter election
consulting fees as the purpose of the expenditure." Nagata
demanded that Takebe and his second son should be summoned as an
unsworn witness. Meanwhile, speaking to reporters in the Diet
building, Takebe rejected the allegation as untrue.

(3) Pinning hopes on post-Koizumi candidates; Beijing accepts
visits to China by ruling party executives with aim of improving
relations with Japan

YOMIURI (Page 4) (Full)
February 16, 2006

Groups of lawmakers, including ruling party executives, are
scheduled to visit China one after another soon with a view to
improving relations between Japan and China, which have soured
due to Prime Minister Junichiro Koizumi's visits to Yasukuni
Shrine and other factors. Beijing has decided to accept visits to
China by senior ruling party members, reversing its previous
policy. Beijing has also begun exhibiting its stance of pinning
greater hopes on possible successors to Koizumi than on the
Koizumi cabinet.

On Feb. 19, Liberal Democratic Party Policy Research Council
Chairman Hidenao Nakagawa and his New Komeito counterpart
Yoshihisa Inoue will visit China. On March 30, representatives of
seven Japan-China friendship organizations, including former
Prime Minister Ryutaro Hashimoto, former Home Affairs Minister
Takeshi Noda (who is also chairman of the Japan-China
Association),and former Foreign Minister Masahiko Komura, are
scheduled visit China. Furthermore, talks with Chinese President
Hu Jintao are scheduled for the group including Hashimoto, which
will be accompanied by Chinese Ambassador to Japan Wang Yi.

Beijing has been reluctant to accept visits by Japanese lawmakers
since a series of anti-Japan demonstrations last spring. Although
China accepted visits by Minshuto (Democratic Party of Japan)
President Seiji Maehara and Social Democratic Party head Mizuho
Fukushima in December, visits by senior ruling party members have
not realized.

China's new stance has raised concerns in Japan. A junior LDP
member speculated, "By placing Prime Minister Koizumi out of the
loop, China is trying to affect the post-Koizumi race and Japan's
public opinion."

Noda delivered a speech in Tokyo yesterday in which he said,
"When I met with Chinese State Councilor Tang Jiaxuan, a former
foreign minister, in Beijing, he told me, 'We cannot expect
relations with Japan to turn for the better as long as Prime
Minister Koizumi remains in office. We place expectations on
Koizumi's successor.'" Noda also said, "The question of paying
homage at Yasukuni Shrine and policy toward China are important
factors in considering the successor to Prime Minister Koizumi."

Before the Japan-China Parliamentarian Friendship Association,
Chinese Ambassador Wang reiterated concern yesterday over visits
to Yasukuni Shrine by the Japanese prime minister, saying, "Any
political impediments (to the relationship between Japan and
China) must be eliminated." During his stay in Japan, the
Association's Vice Chairman Jing Dunquan held talks with Chief

TOKYO 00000851 003 OF 009


Cabinet Secretary Shinzo Abe on Feb. 13 and with Foreign Minister
Taro on the 14th. Those meetings have also sparked speculation
that the purpose was to size up possible successors to Koizumi.

(4) Sozo presents US Consul General with its own US force
realignment plan

OKINAWA TIMES (Page 3) (Full)
February 16, 2006

A group of members of Okinawa political group Sozo (headed by
Mikio Shimoji),including Acting Representative Hiroshi Goya,
Secretary General Chohei Maekawa, and Policy Research Council

SIPDIS
Chairman Morio Toma, held talks yesterday with US Consul General
for Okinawa Thomas Reich at the Consulate General in Urasoe. In
the meeting, the group presented its own plan to build a helipad
on the coastline of Camp Schwab in Nago as part of the planned US
force realignment.

Sozo's plan is designed to immediately close down the US Marine
Corps' Futenma Air Station to build a 300-meter-by-300-meter
helipad at Camp Schwab. The group also explained a plan to
temporarily shift part of functions of the Futenma airfield to
Kadena Air Base once its military strength, such as fighters, is
reduced.

Consul General Reich welcomed the proposal, saying, "This is the
first case we have received a counter-plan from local residents
in the course of bilateral talks on US force realignment." At the
same time, citing an agreement specified in an US force
realignment interim report to build a 1,800-meter runway on the
coastline of Camp Schwab, the Consul General said: "An agreement
has been reached on the need to build a runway in constructing
the alternative facility. Questions remain if such a helipad can
be the alternative facility."

Reich also revealed a negative view about substantially reducing
the military strength of Kadena Air Base, noting:

"The importance of Okinawa is increasing due to North Korea's
nuclear ambitions and China's military buildup. The military
functions of Kadena Air Base are particularly indispensable."

Maekawa sought US understanding, stating:

"Seventy to eighty percent of Okinawa residents are opposed to
the coastal relocation plan. The United States should lend an ear
closely to the voices of the Okinawa public who have been
suffering from US bases for the last 60 years."

(5) CEFP agrees to set global strategy in May

YOMIURI (Page 9) (Full)
February 16, 2006

The Council on Economic and Fiscal Policy (CEFP) yesterday agreed
to compile a global strategy in order for the government to
strengthen Japan's international competitiveness. The panel will
look into the possibility of expanding the framework for skilled
and able foreign workers, developing a comprehensive strategy for
the improvement of international competitiveness of the
agriculture, fisheries and forestry industries and promoting
efforts to sign economic partnership agreements (EPA).

TOKYO 00000851 004 OF 009



(6) South Korean Foreign Affairs & Trade Minister Ban joins race
for UN top post; Ban "expects Japan's support," but Japan says,
"It's difficult..."

NIHON KEIZAI (Page 2) (Full)
February 15, 2006

South Korean Foreign Affairs & Trade Minister Ban Ki-moon who has
declared his candidacy for the top post of the United Nations
indicated at a press conference on Feb. 14 that he hoped Japan
would support him, saying: "I'm happy to hear of Japan's position
that an Asian candidate should fill the post." Speaking of how to
respond to North Korea's nuclear development programs, Ban
stressed: "If I were elected, I would play a positive role to
resolve the issue peacefully and swiftly." (Hiroshi Minegishi,
Seoul)

The Japanese government has taken a cold attitude toward Ban's
statement. South Korea has been opposed to Japan's long-cherished
desire to become a permanent member of the UN Security Council. A
senior Foreign Ministry official said flatly: "Only when it's
convenient for them do so, they ask for our support. But giving
support is difficult."

Asked by reporters whether to back Ban, Prime Minister Junichiro
Koizumi said innocuously: "Isn't it too early to decide?" Chief
Cabinet Secretary Shinzo Abe told the press, "An Asian candidate
should be elected," but he added: "We'd like to make a decision
from a comprehensive standpoint, for instance, considering
progress in the UN reform."

(7) One year since Kyoto Protocol went into effect: Only 19 local
governments establish surveillance system to check greenhouse gas
emissions by companies

MAINICHI (Page 1) (Slightly abridged)
February 16, 2006

February 16 marked the first anniversary of the enactment of the
Kyoto Protocol, which obligates industrialized countries to cut
back on the emissions of such greenhouse gasses as carbon dioxide
(CO2). The Mainichi Shimbun conducted a survey of 47 prefectures
and 14 government ordinance cities on companies' greenhouse gas
emissions and their plan to cut such emissions. The survey found
that 19 local governments had their own reporting system, of
which only nine local governments had a regulation on the
disclosure of information on individual companies.

Determining the amount of emissions ascribable to corporate
activities is the basic part of global warming preventive
measures. But the survey found that there were differences in
efforts by local governments.

In compliance with the Global Warming Preventive Measures
Promotion Law, the government will introduce a reporting system
targeting major companies that emit greenhouse gasses more than a
certain fixed amount, starting this spring. Local governments
that have independently established their own ordinance did so in
order to shed light on the state of greenhouse gas emissions in
their districts, by including companies that are not made targets
under government guidelines.


TOKYO 00000851 005 OF 009


Fourteen prefectures, including Saitama, Tokyo, Kyoto, Osaka and
Hiroshima and five government ordinance cities, such as Yokohama,
Nagoya and Kyoto, have a reporting system, established under an
ordinance.

Kyoto was the first local government throughout the nation that
enacted a set of global warming preventive measures. The
ordinance obligates companies to report the amount of greenhouse
gas emissions. It also adopted a system that mandates
transportation companies, such as tax companies, as well as
plants that use a huge amount of electricity and fuels, to
annually report their greenhouse gas emission reduction data. The
Tokyo metropolitan government has set a system of mandating the
submission of a five-year reduction plan, and evaluating and
giving guidance on implementation results.

The methods of disclosure adopted by each local government are
varied. The ordinances of Kyoto and Mie provide the full
disclosure of information on individual companies. Hyogo and
Ishikawa do not disclose information on individual companies. The
ordinances of Iwate, Tochigi and Miyazaki do not include a
regulation on the disclosure of such information.

Of 42 prefectures and cities that do not have an ordinance on
global warming preventive measures, 22 replied that they had no
plan to introduce such for the time being with an official of the
Akita Prefectural Government saying, "Since many companies in
Akita are small and medium-sized, it will be more effective to
encourage them to reduce emissions" or an official of Shimane
Prefectural Government saying, "It will be meaningless to adopt
such a system, because such a system established by a local
government will overlap." Officials of some government offices
pointed out a shortage of experts on global warming preventive
measures on the corporate side.

(8) LDP Constitutional Research Commission Chairman Hajime Funada
says LDP will come up with second draft constitution including
many views in the party, new LDP president should show the way to
constitutional reform

TOKYO SHIMBUN (Page 2) (Full)
February 16, 2006

Questioner: The Liberal Democratic Party (LDP) seems to have
stopped constitutional debate since your party came up with a
draft constitution last November.

Funada: The mood in our party was high at the time when we
formulated the draft constitution. Some members, however, think
that the draft does not necessarily include views of the party. I
cannot give the draft any score, but I feel many party members
are unhappy with it.

Questioner: Could you tell about what are problems specifically?

Funada: For example, the contents of a preamble to the draft
constitution are well-made, but too many words expressing
feelings were omitted from the preamble. The improvement is that
Article 9 of the draft constitution allows Japan to have jieigun
or a self-defense military (army). However, the draft does not
clearly stipulate reasons why Japan is not allowed to use the
right of collective self-defense. The draft includes several new
rights, but few national obligations and responsibilities are

TOKYO 00000851 006 OF 009


included. I cannot give examples because there are too many.

Questioner: Don't you think the LDP failed to deepen debate
because the party hastened to compile the draft constitution in
accordance with the 50th anniversary of its founding last year?

Funada: It is true that we were unable to take enough time for
discussion. Ironically, the fact that the LDP won a landslide
victory in last year's House of Representatives election was also
a major reason. Because we were needlessly concerned that the
public might have thought us arrogant if we compiled a draft
constitution, which has the tendency to revert to the old ways,
while we were being excited at the bid win.

Questioner: Do you think the LDP was too much aware of making
compromises with the New Komeito and Minshuto (Democratic Party
of Japan)?

Funada: We intended to create a draft constitution based on
compromise and cooperation. I also thought that our party should
cooperate with the New Komeito and the largest opposition party.
However, the draft constitution was the one I did not expect.
Honestly, it is difficult to explain it (to the public). We would
have held campaigns toward the public and town meetings. But we
had no choice but to cancel such activities.

Questioner: Do you plan to rewrite the draft constitution?

Funada: We think that we need to rewrite the draft constitution
to ask for the people's vote of confidence. We call the present
draft as the first draft. After adding corrections to the first
draft, we will make a second draft. We would like to to ask for a
vote of confidence regarding the second draft constitution.

Questioner: There are two groups in the LDP: A group calling for
formulation of the party's own draft constitution and the other
favoring cooperation with the two parties.

Fukuda: I have the impression that the group insisting on the
creation of the party's own draft constitution is somewhat
gaining influence in discussions on the Yasukuni issue and the
issue of revising the Imperial House law.

Questioner: When do you expect to formulate a second draft
constitution?

Funada: Debate from now on would link to the question of who
would be the next party president. I think the person who will be
elected the LDP president in September will give us directions.
Until then, we will move ahead with discussion in order to come
up with a second draft.

Questioner: Do you think the constitutional issue should be a
major campaign issue for the LDP presidential race?

Funada: It is difficult for presidential candidates to speak of
constitutional reform because they might be bound by their
remarks in the future. But I want them to express their
determination as to when they will finish the work of amending
the Constitution and directions.

Questioner: In order to display directions, a national referendum
bill is needed.

TOKYO 00000851 007 OF 009



Funada: I would like to get the bill readied before the end of
the ongoing Diet session, and the party will conduct a debate on
a second draft constitution under the leadership of new
president. We want to start next year coordination on a set of
proposals for constitutional amendments with the New Komeito and
Minshuto.

(9) Amakudari is stymieing structural reform

TOKYO SHIMBUN (Page 3) (Full)
February 15, 2006

In the wake of a recent bid-rigging scandal involving the Defense
Facilities Administration Agency over its construction projects,
the government is now being accused of placing lax restrictions
on amakudari, literally 'descent from heaven' or government
bureaucrats' practice of landing lucrative jobs with public
corporations or private businesses after retirement. The Koizumi
cabinet, since coming into office in April 2001, is supposed to
have cracked down on the collusion of politicians, bureaucrats,
and businesses. In fact, however, their collusive ties remain
unchanged. This report looks into problems about the golden-
parachuting practice.

"I can't say the amakudari practice and the bid-rigging case have
nothing to do with each other. We'll have to take steps to
improve this." With this, Prime Minister Junichiro Koizumi
indicated before the House of Representatives Budget Committee in
its Feb. 6 meeting that the government would tighten amakudari
regulations following the DFAA bid-rigging scandal.

The National Civil Service Law prohibits government personnel for
a period of two years after their retirement from parachuting
into private businesses that are closely related to state-
affiliated entities.

However, a former DFAA official, who is suspected of being
involved in the bid-rigging scandal, moved into a public-interest
corporation after his retirement. More than two years later, he
parachuted into a general construction contractor.

The DFAA is alleged to have portioned out construction work
orders based on the number of DFAA parachutists working for each
contractor. Contractors are believed to have aimed at securing
job orders by accepting DFAA retirees.

They took advantage of a loophole in the law. However, such a way
of parachuting is not peculiar to the DFAA only. The Tokyo
Shimbun looked into facts about amakudari. In many cases, retired
bureaucrats were found to have landed in private corporations
more than two years after moving into public-interest
corporations and the like.

Furthermore, the problem is that the government has failed to
check such a legal loophole.

In late 2001, the government made a cabinet decision to adopt an
outline of public service personnel system reform. Based on this
outline, the government makes public amakudari corporate names
and position titles in the case of those who were above the
division director level or the planning officer level and moved
into public-interest corporations or private-sector businesses

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within two years after their retirement. In addition, the
government has also required all public-interest corporations to
disclose the names of their ex-bureaucrat officials for improved
transparency.

However, the government does not have to make public such
amakudari corporate names and position titles when it comes to
those moving into the private sector more than two years after
parachuting into public-interest corporations as in the case of
the one in the DFAA bid-rigging scandal. "Basically, public-
interest corporations are private-sector entities," says an
official in the Ministry of Internal Affairs and Communications
(MIC). The MIC official went on, "So the government cannot
require them to go that far." However, the government
bureaucracy's post-retirement parachuting is beyond the reach of
public scrutiny. It is not too much to say that this has been a
climate for bid rigging with amakudari officials.

Furthermore, the government bars amakudari parachuting into
private-sector businesses closely linked to state affiliates.
This also has a loophole.

At present, an amakudari official's company and that official's
previous government office are "closely tied" if the amount of
their contracts accounts for over 25% of that company's sales. In
the case of big businesses with large turnovers, however, the
proportion of their contracts with specific government offices
relatively goes down. In point of fact, no holds are barred for
big businesses. Public servants are "actually free" to descend on
big companies as soon as they quit or retire, according to a
government official.

The leading opposition Democratic Party of Japan (DPJ or
Minshuto) recently introduced a bill to the House of
Councillors-the lower chamber of parliament-to amend the National
Civil Service Law. The DPJ bill extends the current two-year
period of moratorium on amakudari into the private sector to five
years. Shu Watanabe, playing the role of MIC minister in the
DPJ's shadow cabinet, explains: "After five years, amakudari
officials' ties with their previous government offices will be
thinner, and it will be difficult to get together and rig bids by
involving retired bureaucrats."

Some officials note that a further tightening of the restrictions
will conflict with the constitutionally guaranteed freedom of
choice in employment, so they deem it difficult to revise the
law. For this reason, instead of beefing up the amakudari
restrictions, one government source insists on introducing
bidding systems that make it difficult to rig the bids, such as
open competitive bidding with many contractors participating.

On the side of bureaucrats, however, there seems to be no sense
of sin about amakudari from the start.

"It's not a bad thing to make use of human resources with
expertise outside the government," says one senior official in an
economic agency of the government. A senior official in another
government office insists, "Restricting amakudari is the same as
telling us not to work. There is no denying the fact that Prime
Minister Koizumi has done nothing about such a bureaucratic
logic.

"The Koizumi government has not seriously stuck the knife into

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the vested interests of politicians, bureaucrats, and
businesses," says Koji Matsui, one of the DPJ's House of
Councillors members who presented his party's five-year amakudari
moratorium bill.

SCHIEFFER