DAILY SUMMARY OF JAPANESE PRESS 01/29/07

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SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 01/29/07


INDEX:

(1) Prime Minister Abe to set up a strategic council to counter the
falling birthrate

(2) Prime minister reprimands health minister for his inappropriate
remarks referring to women as "child-bearing machines"

(3) Government to conclude 80% of procurement contracts under
competitive bidding system

(4) Sending civilian policemen to East Timor: MOF positive toward
dispatch, while NPA remains negative; Took five months in deciding
to dispatch two personnel

(5) Weak yen increasingly drawing international criticism: Likely to
become focus of G-7; BOJ might use criticism as excuse for raising
interest rate

(6) Facts about SDF mission in Iraq (Section 1); Thinking of SDF as
Japan's new garrison-SDF in transformation (Part 7): Limits to
GSDF's own resources-Private contractors needed for GSDF's overseas
activities

(7) Commentary: Bush's Iraq war

ARTICLES:

(1) Prime Minister Abe to set up a strategic council to counter the
falling birthrate

ASAHI (Top Play) (Full)
January 28, 2007

In dealing with the declining birthrate, one of the key issues,
Prime Minister Shinzo Abe has decided to establish a panel to come
up with comprehensive measures, including ones that would help
revive regional communities and families, and review ways that
people work. The panel, to be called "Strategic Council to Study
Measures to Support Children and Families," will hold its first
meeting in early February and compile a set of basic proposals in
mid-June. The set of proposals will be included in the government's
"big-boned reform policy guidelines for 2007." With an eye on tax
system reform debate, including a consumption tax hike, which will
begin after the House of Councilor election, Abe also plans to
formulate a "priority strategy."

With the decline in the birthrate continuing, and the population of
juveniles expected to drastically drop from 2030, the government has
no choice but to create effective measures to counter the trend. For
this reason, Abe in his policy speech on Jan. 26 stated: "Children
are national treasures. We must make Japan a country in which people
can give birth and bring up children without anxiety. I will set out
a full-scale strategy to reverse the declining birthrate."

Abe has already instructed Chief Cabinet Secretary Yasuhisa Shiozaki
to look into the issue on a full scale. He intends to shift from
traditional measures to counter the declining birthrate that mainly
place emphasis on such economic assistance measures as child
allowances and child support. Attaching importance to need for a
balance between work and life, he plans to come up with measures,
including revenue sources, in order to create a system under which
the entire spectrum of society would support families raising

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children.

The council will be made up of Shiozaki as chair, relevant cabinet
ministers, experts and representatives from the labor and management
organizations. Under the council, four sub-committees will be set
up: 1) basic strategy; 2) reform of the way people work; 3)
revitalization of regional communities and families; and 4)
examination and evaluation. The four panels will discuss specific
solutions.

The basic strategy sub-panel will look into measures for economic
assistance, including revenue sources, such as income compensation
during childcare maternity. The sub-panel on reform of way people
work will propose creating work environment under which people can
work while raising children.

The sub-panel on revitalization of regional communities and families
will look for measures for communities to support children in
difficulty such as being children of single-parents. The sub-panel
on examination and evaluation will reexamine and review the measures
set out by the government and local municipalities.

The new measures to counter the falling birthrate the government
compiled last year included 40 countermeasures such as adding
infants to the category of child allowances. There are no financial
resources allocated, however. Child allowances for infants for new
fiscal year will be covered by surpluses from the special funds for
emergency employment measures as a makeshift effort. Some criticized
the Abe government for failing to draw up a grand design for the
society that should be aimed at.

In order to a comprehensive strategy, which includes how labor law
should be revised and how the way people work should be changed, the
new council to be established will come up with measures that the
whole government will be engaged in carrying out. The cabinet will
adopt big-boned reform policy guidelines that will include measures
to improve the environment for child rearing.

Members of Strategic Council to be set up

Cabinet ministers
Chief cabinet secretary (chairman)
Mister in charge of declining birthrate
Minister in charge of economic and fiscal policy
Internal affairs and communications minister
Finance minister
Education minister
Health, labor and welfare minister
Economy, trade and industry minister
Land, infrastructure and transport minister

Experts
Hiroshi Yoshikawa, profess of graduate school at University of
Tokyo, who will head sub-panel on basic strategy
Yoshio Higuchi, professor at Keio University, who will head
sub-panel on reform of ways people work
Katsuyoshi Iwabuchi, professor at Tohoku Fukushi University, who
will head sub-panel on revitalization of regional communities and
families
Hiroki Sato, professor at University of Tokyo, who will head
sub-panel on examination and evaluation.

Representatives from labor and management sectors

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Morio Ikeda, Japan Business Federation's Committee on Falling
Birthrate
Nobuaki Koga, chief of secretariat of Japan Trade Unions
Confederation

Representative of local communities
Keiko Kiyohara, mayor of the city of Mitaka, Tokyo

(2) Prime minister reprimands health minister for his inappropriate
remarks referring to women as "child-bearing machines"

TOKYO SHIMBUN (Page 2) (Full)
Eve., January 29, 2007

Prime Minister Shinzo Abe this morning gave a strong warning to
Health Minister Hakuo Yanagisawa, who in a recent speech had
referred to women as "child-bearing machines or devices," telling
him: "You must be careful enough not to make a similar inappropriate
remark in the future." This was revealed by Chief Cabinet Secretary
Yasuhisa Shiozaki during a press briefing earlier in the day.

According to Shiozaki, Yanagisawa telephoned Abe and Shiozaki this
morning and explained why he had made such remarks and apologized to
them.

At the press briefing, Shiozaki brushed aside the possibility of
Yanagisawa being driven to step down from his post for his
inappropriate remarks, saying to reporters: "I think his remarks
were inappropriate, but he was quick to correct them. It is
important for Mr. Yanagisawa to work as a key member of the Council
on Strategic Approaches to Deal with the Falling Birthrate to
produce results."

Prior to that, Yanagisawa this morning stressed to reporters in
Tokyo that he had already retracted his remarks, saying: "I'd like
to explain my true intentions through Diet deliberations."

On the other hand, like-minded female lawmakers of three opposition
parties -- the Democratic Party of Japan (Minshuto or DPJ),the
Japanese Communist Party, and the Social Democratic Party -- this
morning decided to call on Yanagisawa to resign as health minister.
Minshuto Diet Policy Committee Chairman Yoshiaki Takagi at a press
conference indicated that he would harshly pursue him at the Lower
House Budget Committee and other committees, by noting: "This person
is also a member of the Abe cabinet. The remarks he made were
disgraceful, indeed."

(3) Government to conclude 80% of procurement contracts under
competitive bidding system

NIHON KEIZAI (Page 1) (Full)
January 27, 2007

The government decided yesterday to shift about 60% of its
non-competitive contracts (zuii-keiyaku) to be concluded by
government agencies for purchasing goods or ordering public works
projects to a competitive contract formula, such as the open
competitive bidding system. Such contracts amount to approximately
2.1 trillion yen. The transfer process will start this fiscal year
and be completed within FY2007. Of all the contracts to be concluded
by the government, about 80% will be concluded based on a
competitive bidding formula. Reflecting on the recent series of
bid-rigging cases at the initiative of government offices, it is

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imperative to reduce the government's procurement costs. In
addition, it is also necessary to make the contents of contracts
more transparent by thoroughly disclosing information on government
contracts.

With the aim of preventing complicated procedures, many government
agencies have placed orders with the same entities year after year
in renting copying machines or entrusting research to private firms,
instead of using a competitive bidding formula. Many anticipate that
the planned introduction of competitive bidding formulas would
reduce government agencies' purchase costs by about 10%.

The value of contracts based on non-competitive formulas in FY2005
totaled approximately 3.4 trillion yen. The government has judged it
possible to adopt competitive contracts for about 1.4 trillion yen
worth of contracts with government-affiliated organizations and for
about 700 billion yen worth of contracts with private firms. The
remaining contracts worth of approximately 1.3 trillion yen are for
defense equipment and other products whose supply sources are
limited, so the current non-competitive contract system for such is
likely to be continued.

As for 7.3 trillion yen worth of contracts for goods procured by the
government in FY2005, an estimated 6 trillion yen worth of contracts
will be shifted to a competitive formula, with 3.4 trillion yen
worth of those set for competitive bidding and about 500 billion yen
worth of those set for non-competitive contracts.

The government intends to put the contents of all contracts each
government agency concluded on their websites. If government
agencies opt for non-competitive contracts, they will have to list
the reasons.

(4) Sending civilian policemen to East Timor: MOF positive toward
dispatch, while NPA remains negative; Took five months in deciding
to dispatch two personnel

MAINICHI (Page 2) (Full)
January 28, 2007

Two civilian policemen to be dispatched to the United Nations
Integrated Mission in Timor (UNMIT),which is in charge of
maintaining security in East Timor, will leave Japan on Jan. 31.
However, there is a gap in the views of government officials on the
matter with the Foreign Ministry (MOF) hoping to accumulating track
record of the dispatch of personnel to UN peace-keeping operations
(PKO) with the aim of gaining a permanent seat at the UN Security
Council (UNSC),and the National Police Agency (NPA) cautious about
dispatching its personnel with its personnel dispatched to Cambodia
in the past killed. Prospects for the dispatch of civilian policemen
abroad after a hiatus of eight years contributing to expanded
personnel contribution are not favorable.

This will be the third dispatch of NPA personnel, following the
dispatch of one personnel to Cambodia from 1992 through 1993 and two
personnel to East Timor in 1999. In Cambodia, an Okayama Police
superintendent was killed by an armed force. Three policemen were
dispatched to East Timor to assist its direct local referendum.
However, security there sharply deteriorated soon after the
referendum. There has been no dispatch of policemen for eight years
since then.

A senior NPA official said, "People might say that we have Cambodian

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trauma, but if personnel dispatched to abroad get killed, the
administration will be overturned."

It took about five months for the NPA to decide to send its
personnel this time since the UNSC adopted a resolution to set up
the UNMIT last August. Some criticized the NPA's decision to
dispatch only two personnel with former UN Undersecretary General
Yasushi Akashi saying, "The NPA is far too cautious. Japan's policy
of attaching importance to the UN is not backed by action."

NPA Director General Iwao Uruma said, "It is difficult to dispatch a
large number of policemen because there is no system of law allowing
the NPA to get involved in the dispatch, such as it can directly
train personnel to be dispatched." If that is the case, it will be
through the dispatch of Self-Defense personnel for Japan to
accumulate a track record of dispatching personnel to carry out
PKO."

(5) Weak yen increasingly drawing international criticism: Likely to
become focus of G-7; BOJ might use criticism as excuse for raising
interest rate

YOMIURI (Page 9) (Full)
January 27, 2007

Criticism of the weak yen is increasingly becoming strong, mainly in
Europe. Behind the trend is a sense of alarm that the
weak-yen-and-strong-euro trend could put a dent in European
countries' international competitiveness. Many have cited Japan's
ultra-low interest rate as a cause of the weak-yen trend. The
National Consumer Price Index (CPI) for December, released by the
Internal Affairs Ministry on Jan. 26, rose 0.1% on a year-on-year
basis. The rate of the increase fell by 0.2% from the previous month
with prospects for an interest hike becoming further dim. There has
now appeared a possibility of the weak yen and the ultra-low
interest rate, which is viewed as the cause the weak yen, being made
the target of criticism at a meeting of finance ministers and
central bank governors from the Group of Seven nations (G-7) to take
place in Germany from Feb. 9 through 10.

The yen's downward trend at the Tokyo foreign exchange market has
kicked in with the Bank of Japan (BOJ) giving up the idea of hiking
the interest rate on Jan. 18. On Jan. 26, the value of the yen fell
to the middle of 121 to the dollar and the lower half of 157 to the
euro.

Following the recent weakening-yen trend, one senior German official
on Jan. 24 checked Japan, " The weak yen issue might be brought up
at the upcoming G-7 meeting." Finance Vice Minister for
International Financial Affairs Hiroshi Watanabe on the evening of
Jan. 25 counter-argued, "It is not our understanding that the G-7
will take up concern about the weak yen." However, the observation
is widespread among market players that some discussions on the
possibility of correcting the weak yen trend might be pursued at the
G-7. The market has started showing a sensitive movement, such as
violent fluctuations of the yen exchange in response to statements
by key officials.

On the other hand, there is an aspect of the sudden weakening of the
yen working as a positive factor for the BOJ, which wants to raise
the interest rate in February.

The greatest factor that would allow the BOJ to raise interest rates

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would be an increase in consumer prices. However, the rate of an
increase in the CPI for December remained at 0.1%, which is lower
than the November rate. The temporary lull in the rise of crude oil
prices and a fall in the prices of digital consumer electronics as a
whole are viewed as major causes of the sluggish increase in
consumer prices. Personal consumption as a whole lacks vigor. The
prevailing view on the market is that given the price and
consumption movements, it would be difficult for the BOJ to insist
on the legitimacy of an interest rate hike.

Amid the BOJ unable to find data to justify an interest rate hike
with the CPI staying flat contrary to its wishes, it has begin
showing a move to check the government and the ruling parties, which
are cautious about the idea of hiking the interest rate, taking the
advantage of international criticism of the lowering yen. Vice BOJ
Governor Toshiro Muto on the 25th called on a certain senior LDP
official and asked for understanding toward the rising criticism of
the weak yen. Some take this visit as a strategic move toward an
early hike in the interest rate.

Chief Cabinet Secretary Shiozaki during a press conference on the
26th noted, "It is only natural for the BOJ to determine its
financial policy with the yen exchange in mind." He thus indicated a
certain level of understanding toward the BOJ, which has begun
stressing the causes of the weak yen.

The movements of the yen exchange will determine the fate of the
upcoming G-7 meeting. It also will likely have impact on the BOJ,
which has started making efforts to persuade the government and the
ruling parties for an early interest rate hike.

(6) Facts about SDF mission in Iraq (Section 1); Thinking of SDF as
Japan's new garrison-SDF in transformation (Part 7): Limits to
GSDF's own resources-Private contractors needed for GSDF's overseas
activities

TOKYO (Page 1) (Full)
January 16, 2007

A uniformed member of the Ground Self-Defense Force was standing
still in a daze. He was wearing a wheel badge for the GSDF's
transport service.

On Feb. 4, 2005, that GSDF member was waiting for a civilian plane
at the Air Self-Defense Force's Komatsu Air Base in Ishikawa
Prefecture. The civilian plane, chartered by the GSDF, was to be
bound for Kuwait with weaponry and ammunition onboard for GSDF
troops to be dispatched to Iraq in rotation. However, the charter
plane, which was to have arrived there on the previous day, did not
show up.

The GSDF's 5th Iraq Reconstruction Assistance Group-mainly composed
of GSDF troops based at a GSDF garrison in the city of Nagoya-was to
fly its component troops from the ASDF's Komaki Air Base in the city
of Komaki, Aichi Prefecture, and was to airlift its supplies from
Kansai International Airport.

Shortly before the departure date, the airport refused the GSDF's
charter flight. A South African civilian charter plane was to
airlift weaponry and materiel supplies from Komatsu Air Base.
However, the charter plane did not come in the end.

On Feb. 18 that year, those weapons and ammo supplies were loaded

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onto another charter plane at Nagoya Airport, which is under the
Aichi prefectural government's management. It was the Antonov, a
superheavy-lift cargo carrier of Russian make. The GSDF's airlift
plan was 15 days behind schedule.

"At that time, my stomach was aching," said Col. Yuichi Kajiya, 44,
who headed a transport squad in the GSDF Ground Staff Office. The
squad, which was in charge of airlifts from Japan to Iraq, forwarded
200 vehicles and 400 containers, or a total of 450,000 items.

GSDF troops were flown mainly on civilian charter planes. "We put
everything out to tender," Col. Kajiya said. According to him,
travel agents and shipping companies bid for contracts with their
respective proposals of rates for transportation in Japan, bus
transportation after their arrival in Kuwait, and charter planes. No
Japanese agents participated in overland shipping from Kuwait to
Iraq. Col. Kajiya therefore looked for a local company and
contracted that company.

The Antonov was the only plane that could airlift a huge amount of
cargo for GSDF troops at a time. Only two airliners had that plane.
One was in the possession of a British company, and the other in
Ukraine. Charter rates shot up with the worldwide release date of
Beaujolais Nouveau approaching.

Commercial transportation was not as stable as the ASDF's. In
addition, the GSDF contracted a trading company to build its
temporary camp in the southern Iraqi city of Samawah. However, its
work of setting up the camp there fell substantially behind
schedule, and its prefabricated housing completed there was bent.
"We thought it was a business chance." So saying, an executive of
the trading company explained that the company gave first
consideration to profitability as the primary reason for its
contract.

Even so, one of the lessons the GSDF has learned from its Iraq
mission was to better use private contractors.

GSDF Maj. Gen. Goro Matsumura, 48, who is in charge of troop
mobilization as director of the 2nd Operations Division in the Joint
Staff Office (JSO) of the Ground, Maritime, and Air Self-Defense
Forces, explained: "Wars after the Cold War can be divided into
combat areas and comparatively safe areas where civilians can get in
like in Iraq. Foreign countries have been cutting back on their
military spending, so their armed forces have now found it difficult
to be self-contained."

US forces are positive about utilizing private contractors. For
instance, the US military has been hiring a Kuwaiti company for
overland shipping to Baghdad. This company, well paid in its
contract with the US military, replaced its trucks with new ones
that are less troubled than old ones. The GSDF also contracted the
same company, and its overland transportation became stable.

In June 2006, when the GSDF began preparing its pullout from Iraq,
one of its light armored vehicles overturned in a southern locality
of Iraq. Three GSDF members were injured in that accident, and they
were taken to a US military hospital in Germany.

The JSO considered airlifting the three to Japan on an ASDF C-130
transport. However, the C-130 would take four days because it is a
propeller plane. According to Maj. Gen. Matsumura, the GSDF found a
Japanese agent for medical airlift services using jet aircraft. "We

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didn't use it," he said. "But," he added, "the private sector's
systems are more advanced than ours." According to Col. Kajiya, the
GSDF's transportation staff is less than 100. "We have limits to
what we can do, so we cannot do everything ourselves, and we need
help from outside" Col. Kajiya said.

The GSDF will now need to work together with its civilian
contractors in its overseas activities.

(This is the last of a seven-part series written by Shigeru Handa,
Local News Section, Tokyo Shimbun.)

(7) Commentary: Bush's Iraq war

TOKYO SHIMBUN (Page 1) (Full)
January 29, 2007

"Human beings are quite opportunists, and whenever they want to do
something, they find excuses or reasons for such acts." This is one
paragraph in the autobiography of Benjamin Franklin, an American
politician who edited the Declaration of Independence. It would be
better to add the words "especially politicians" to the paragraph.

In the United States, President Bush and the Congress have clashed
head-on over the president's plan to deploy more troops in Iraq. In
Iraq, the war has cost many lives of American troops and Iraqis. It
is apparent that the preventive war waged by President Bush to fight
terrorism is the main cause for the current stalemated security
situation there.

This kind of notion (preventive war) had not existed before the Iraq
war was launched. Arthur Schlesinger, Jr., an expert on American
history, in his book Presidents at War argues that although the US
was about to opt for "a revolutionary change," there was no
nationwide debate.

Preventive war is intended to cope with a potential future threat,
so thoroughly analyzing intelligence is absolutely necessary. As
seen from the outcome of the Iraq war, however, it is impossible for
a nation to perfectly analyze intelligence before it goes to war.

Will the Iraq war be the last preventive war? Behind the president's
plan to send more troops to Iraq seems to be his desire that the
Iraq war be seen by history as a successful one. This is an attempt
to justify preemptive war, and Iraq may not be the last one.

The US government has protested Defense Minister Fumio Kyuma's
remarks last week criticizing President Bush's decision to launch
the war in Iraq. The Japanese government, concerned about a lack of
unity in the cabinet over the US Iraq policy, is stepping up efforts
to put the matter to the rest. But the government should also
discuss what response it should take to war. If Japan remains
silent, it will be disqualified from offering its opinion on
America's preventive wars.

DONOVAN