JAPANESE MORNING PRESS HIGHLIGHTS 01/22/08

UNCLAS SECTION 01 OF 11 TOKYO 000152 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 01/22/08 Index: Opinion polls: 1) Jiji poll: Fukuda Cabinet support rate plummets 5.6 points to 34 PERCENT ; nonsupport rises to 39.8 PERCENT (Tokyo Shimbun) 2) Fukuda non-support rate at 45 PERCENT in Mainichi poll, far outpacing support rate of 33 PERCENT ; Majority frown on Lower House overriding of bills rejected by Upper House (Mainichi) 3) Mainichi poll finds 32 PERCENT favoring Diet dissolution after budget compiled in spring, while 28 PERCENT would put it off until after the G8 Summit (Mainichi) 4) Jiji poll: 38 PERCENT approve, 34 PERCENT disapprove revote on refueling mission bill (Tokyo Shimbun) Korean Peninsula affairs: 5) Ambassador Schieffer in Los Angeles speech worries that Japan, South Korea might go nuclear if North Korea is allowed to possess nuclear arms (Mainichi) 6) South Korean President-elect Lee plans to make Japan his first overseas visit after inauguration (Nikkei) Defense and security affairs; 7) Japan to implement 180 billion yen package of yen loan projects in Iraq for needed infrastructure repairs (Asahi) 8) Prime Minister Fukuda skips ceremony for departure of MSDF ships hearing for Indian Ocean refueling mission (Tokyo Shimbun) 9) Citing tactical reasons, U.S. refuses to sign note with Japan ensuring that MSDF fuel provided in Indian would be used only for OEF/MIO (Tokyo Shimbun) 10) Futenma relocation site's environmental assessment likely to start next month (Asahi) 11) Moriya admits to committing perjury in Diet testimony and will be so charged (Tokyo Shimbun) Africa aid: 12) Government to provide Africa with PKO training (Nikkei) 13) Foreign Ministry blue-ribbon panel calls for expansion of assistance to Africa (Sankei) 14) On again off again trip to Davos Conference by DPJ head Ozawa is off again (Yomiuri) Economy: 15) In Diet speech, Economic and Fiscal Policy Minister Ota sounds alarm, warning that Japan is no longer a first class economy (Mainichi) 
16) Public split on whether the economy is in sound shape or now in Cabinet Agency poll (Mainichi) 17) Russian banks set to advance into Japan next year (Mainichi) 18) Japan ranked worst among the advanced industrialized countries in greenhouse-gas containment, largely because of reliance still on coal-use generators (Tokyo Shimbun) Articles: 1) Poll: Cabinet support dips to 34 PERCENT TOKYO SHIMBUN (Page 2) (Abridged) January 19, 2008 TOKYO 00000152 002 OF 011 The approval rating for Prime Minister Yasuo Fukuda and his cabinet was 34.5 PERCENT , according to a public opinion survey conducted for the month by Jiji Press on Jan. 11-14. The figure showed a substantial drop of 5.6 percentage points from last month. The disapproval rating for the Fukuda cabinet was 39.8 PERCENT , up 5.6 points. The nonsupport rate topped the support rate for the first time since the Fukuda cabinet came into office in September last year. In the breakdown of public support for political parties, the ruling Liberal Democratic Party stood at 22.9 PERCENT , up 0.7 points from last month. The leading opposition Democratic Party of Japan (Minshuto) was at 15.4 PERCENT , down 0.5 points. As seen from these figures, the DPJ has yet to become a party that can take the place of the LDP-led government. The proportion of those with no particular party affiliation was 53.8 PERCENT , down 0.4 points. The survey was conducted across the nation with a total of 2,000 persons chosen from among men and women aged 20 and over. The retrieval rate was 67.2 PERCENT . 2) Poll: 51 PERCENT opposed to future overriding; Cabinet support levels off at 33 PERCENT MAINICHI (Top play) (Abridged) January 21, 2008 The Mainichi Shimbun conducted a telephone-based nationwide public opinion survey on Jan. 19-20. The Diet has now enacted a new antiterrorism law. The ruling parties took a second vote in the House of Representatives on the law after it was rejected in the opposition-dominated House of Councillors. In the survey, respondents were asked if they thought it was appropriate. To this question, public opinion was split, with 46 PERCENT answering "yes" and 44 PERCENT saying "no." If the upper chamber votes down other bills in the future, the lower chamber could revote on these rejected bills to override the upper chamber's decisions. Asked about this future overriding, negative answers accounted for 51 PERCENT , with affirmative answers at 38 PERCENT . As seen from these figures, the public was severe about the ruling coalition's option of overriding the upper chamber's decisions in the future. The approval rating for the Fukuda cabinet was 33 PERCENT , leveling off from the last survey taken in December last year. On Jan. 18, the Diet called an ordinary session. The ruling and opposition benches are expected to focus on a special taxation measures law in their Diet debate over whether to keep imposing a provisional tax on gasoline. The ruling coalition is ready to take a second vote on the law in the House of Representatives if it is voted down in the House of Councillors. However, the governing parties will likely need to obtain public understanding. The government will now resume the Maritime Self-Defense Force's refueling activities in the Indian Ocean under the now-enacted antiterror law. In the survey, respondents were asked if they supported this government action. In response, 47 PERCENT answered "yes," with 42 PERCENT said "no." 3) Poll: 32 PERCENT want Diet dissolution after budget passage, 28 PERCENT prefer "after G-8 summit" MAINICHI (Page 2) (Abridged) TOKYO 00000152 003 OF 011 January 22, 2008 The Mainichi Shimbun conducted a telephone-based nationwide public opinion survey on Jan. 19-20, in which respondents were asked when they thought the House of Representatives should be dissolved for a general election. The most common answer, accounting for 32 PERCENT , was that the House of Representatives should be dissolved after the budget for next fiscal year clears the Diet. Among other answers, 28 PERCENT said "after this July's G-8 summit in Hokkaido," with 13 PERCENT saying "the House of Representatives should be dissolved immediately" and 20 PERCENT saying "there's no need to dissolve it." Respondents were also asked which political party between the ruling Liberal Democratic Party and the leading opposition Democratic Party (Minshuto) they would like to see win in the next election for the House of Representatives. To this question, the DPJ scored 44 PERCENT , with the LDP at 35 PERCENT . Other political parties accounted for 12 PERCENT . This question was asked in the past six surveys from August last year, and the DPJ has been above the LDP. 4) Poll: 38 PERCENT for new refueling law's enactment in 2nd vote, 34 PERCENT against TOKYO SHIMBUM (Page 2) (Full) January 20, 2008 The Diet enacted a new antiterrorism special measures law in a recent extraordinary session, with the ruling parties taking a second vote on the law in the House of Representatives after it was voted down in the opposition-controlled House of Councillors. However, public opinion was split over this way of enacting a law, according to a Jiji Press public opinion survey released yesterday. In the survey, respondents were asked if they supported the ruling coalition's overriding in the lower chamber of the upper chamber's decision. In response, 38.9 PERCENT answered "yes," with 34.1 PERCENT saying "no." The survey was conducted across the nation on Jan. 11-14 with a total of 2,000 persons chosen from among men and women aged 20 and over. The retrieval rate was 67.2 PERCENT . "Yes" accounted for 60 PERCENT among those who support the ruling Liberal Democratic Party, and 50 PERCENT among those who support New Komeito, the LDP's coalition partner. Among those who support the leading opposition Democratic Party of Japan (Minshuto), affirmative answers accounted for a little less than 30 PERCENT , with negative answers nearing 60 PERCENT . Among those who support the Japanese Communist Party and the Social Democratic Party (Shaminto),90 PERCENT answered "no." Respondents were also asked about the advisability of taking a second vote on other bills in the House of Representatives to override the House of Councillors' rejection of these bills. To this question, 18.1 PERCENT answered that there is no problem because it is constitutional, with 11.7 PERCENT saying they are opposed to overriding the upper chamber's decision in any case. Those accepting it with conditions accounted for more than 50 PERCENT . Among them, 24.4 PERCENT were affirmative for only important bills, with 31.1 PERCENT affirmative for some cases. 4) A nuclear-armed North Korea could pressure Japan and South Korea TOKYO 00000152 004 OF 011 to go nuclear, says Ambassador Schieffer in speech MAINICHI (Page 3) (Full) January 20, 2008 Jiji, Los Angeles U.S. Ambassador to Japan Thomas Schieffer gave a speech at a Los Angeles hotel on Jan. 18. Regarding security in Northeast Asia in a question-and-answer session, Schieffer indicated that the development of nuclear weapons by North Korea must be blocked through the six-party talks, saying, "The possession of nuclear weapons by North Korea could put pressure on Japan and South Korea to arm themselves with nuclear weapons." He also indicated that there is concern in Japan that the United States is putting greater importance on China as its partner than on Japan. The Ambassador said: "Should Japan lose its trust in the U.S., there is the possibility that it may go nuclear. If that were to happen, the situation (in Northeast Asia) would become much more dangerous. The good relationship between the United States and Japan is not something that can be replaced by U.S.-China relations." 5) Coordination underway for South Korean president-elect's visit to Japan immediately before trip to U.S. in March or April NIKKEI (Page 2) (Full) January 22, 2008 Mari Yamaguchi, Seoul South Korean President-elect Lee Myung Bak has decided to choose Japan as the country for his first overseas trip after he assumes office. His schedule for a visit to Tokyo is now under coordination, it was revealed yesterday by several sources familiar with Japan-South Korea relations. According to aides to the president-elect, it is most likely that Lee will stop in Tokyo before he visits the United States in March or April, a plan that is now under coordination. He appears to be looking to repair relations with Tokyo and Washington, which have been cool because of the government of President Roh Moo Hyun. In a telephone conference with Prime Minister Yasuo Fukuda in late last December, Lee proposed resuming annual reciprocal visits between the top leaders of the two countries. Fukuda plans to attend the presidential inauguration on Feb. 25 and to hold a summit with Lee. Fukuda's planed visit to Seoul and Lee's trip to Tokyo will become the first reciprocal visits between them. 6) Government will soon implement 180 billion yen in yen loans to Iraq, centered on such infrastructure projects as repairing power generators ASAHI (Page 1) (Abridged) Eve., January 19, 2008 As assistance for the reconstruction of Iraq, the government has decided to implement soon a package of yen loans totaling 182.7 billion yen that will be centered on building infrastructure, such as a thermal power generator and repairing oil refining facilities. This would be the first large-scale yen loan implementation toward that country since the Iraq war. Based on the amount of assistance TOKYO 00000152 005 OF 011 from specific donor countries, it would be the largest scale next to that from the United States. With the country having stabilized and public security better than before, owing to such factors as the surge in U.S. troops, the intention of the Japanese government is to link the projects to improved civil life. The project to be implemented are part of a total package of approximately $5 billion (approximately 537 billion yen) pledged by the Japanese government in 2003. Although the government exchanged notes with the Iraq government in 2007 for a total of 10 projects, since the administration there was continued to experience instability due to such factors as clashes among religious sects, approval by the Iraqi side was delayed. Contracts will now be signed as early as Jan. 25 between JBIC, as the main implementing body, and the Iraqi government. According to an informed source, eight projects will be targeted for loans this time and include the country's largest power generating facility in the suburbs of Baghdad, repair assistance for the Al-Mussaib Thermal Power Plant Rehabilitation Project, repair of the tanker mooring docks off Basra, and construction of bridges and roads in the Samawah area where the Self-Defense Forces were previously stationed. At the request of the Iraqi government, the decision to go forward was made, with consideration given to such factors as the public security situation. The work will be entrusted to domestic Iraqi firms, as well as companies in countries neighboring Iraq, such as Turkey. To continue the implementation of the yen-loan package, the remaining two projects include rehabilitation of a thermal power station in the northern part which is under the Kurds. Contracts are expected to be signed in several months. The total amount of yen loans implemented this year is expected to reach approximately 240 billion yen (of approximately $2.2 billion). 7) Prime minister and other cabinet ministers may not be able to attend MSDF vessel send-off ceremonies due to Lower House budget committee sessions TOKYO SHIMBUN (Page 2) (Excerpts) January 22, 2008 Prime Minister Yasuo Fukuda, Defense Minister Shigeru Ishiba and other relevant members might not able to attend the Jan. 24 and 25 send-off ceremonies for the Maritime Self-Defense Force vessels that will go to the Indian Ocean to resume the refueling operation under the new antiterrorism special measures law. The reason is that the House of Representatives Budget Committee, the main arena for debate between the ruling and opposition camps, is likely to meet starting on Jan. 24. In many cases, the prime minister and relevant cabinet ministers attend ceremonies to send off MSDF personnel on overseas missions in order to encourage them and demonstrate the government's resolve. One MSDF vessel is scheduled to depart from the Yokosuka base in Kanagawa Prefecture on the morning of Jan. 24 and another one from the Sasebo base in Nagasaki Prefecture on the morning of Jan. 25. But the Lower House Budget Committee is expected to meet on both days. Although the opposition camp has yet to call for the TOKYO 00000152 006 OF 011 attendance of any specific cabinet ministers, chances are that all the cabinet ministers, including the prime minister, will have to be present at the budget sessions. Given the situation, chances are slim for the prime minister and other relevant cabinet minister to visit the two bases to attend the send-off ceremonies. Although the option of holding the send-off ceremonies on Jan. 26 and 27, when there will be no committee meetings, surfaced, the government needed to brush it aside in order to keep its pledge of resuming the refueling operation as soon as possible. 9) U.S. refuses Japan's request for mentioning in exchange notes the limited use of MSDF-supplied fuel TOKYO SHIMBUN (Page 1) (Full) January 20, 2008 The United States government will not mention in the exchange notes the tracking of the use of all fuel provided by the Maritime Self-Defense Force (MSDF) in the Indian Ocean, in declining Japan's request. A US government official gave this explanation: "The verification process will hinder the U.S. strategic operations, and an additional burden will be imposed on those engaged in the operations. We cannot accept Japan's request at all." This information was revealed by several sources familiar with Japan-U.S. relations. The U.S. agreed Japan's plan to specify the MSDF mission in the new antiterrorism law as "supplying fuel and water only to naval vessels engaged in maritime intercept operations against terrorism." Some might criticize that Washington's refusal will make "the limited use of supplied fuel" merely nominal. The MSDF is expected to resume its refueling operation in mid-February based on the new antiterrorism special measures law. The governments of Japan and the U.S. are preparing to finalize exchange notes by the end of this month. According to informed sources, Japanese and U.S. authorities for foreign and defense affairs started coordination last October, when Japan submitted the new antiterrorism bill to the Diet. Keeping in mind the allegation of diversion of MSDF-supplied oil to the Iraq war, Japan requested that the new law specify the purpose of the mission. The U.S. initially insisted that Japan should use the same wording as that in the notes exchanged on the basis of the former antiterrorism law, which included no mention of a ban on the use of supplied fuel for other than the specified purpose. To enable the use of all fuel to be tracked, Japan asked the U.S. afterward to insert this expression in the exchange notes: "The governments of Japan and the U.S. will carry out necessary coordination in order to ensure that the operations will meet the purpose of the new law." But the U.S. turned it down, reasoning that since the tanks of war ships will never empty, it will be impossible to prove that the amount of supplied oil and the amount of consumed oil are completely the same. The U.S. side warned that if Japan makes no concession, there may be a case in which vessels will not receive MSDF refueling service. 10) Futenma environmental assessment may start next month; Nakaima willing to give nod with changes to outline TOKYO 00000152 007 OF 011 ASAHI (Page 35) (Abridged slightly) January 22, 2008 Okinawa Governor Hirokazu Nakaima revealed his plan yesterday to convey to the Ministry of Defense the need to rewrite the part pertaining to the planned landfill project in the MOD's outline specifying an environmental impact assessment for the planned relocation of U.S. Futenma Air Station to Nago. The governor also indicated that he would endorse the assessment once the outline is rewritten. With the government expected to comply with Nakaima's request for rewriting the outline by submitting additional data, the assessment is likely to start in February, as planned by MOD. Even so, there are no prospects for the government to reach an agreement with Okinawa and Nago regarding their request to move the planned construction location further offshore. The government is likely to carry out the assessment while keeping the greatest contentious point on the backburner. Nakaima urged the government to clarify the shape of the envisaged reclaimed land and the construction plan, contending that what is stated in the outline is insufficient to make an appropriate decision. He also requested the government make a final decision after holding talks with the prefectural government on the contents of the project and the survey methods ahead of implementing the assessment. Nakaima, however, is not demanding that the government redo the assessment process, such as the official announcement and inspection, all over again from the start. Nakaima indicated to the press that he would give a nod to the planned assessment once Okinawa's requests are answered, saying: "The government might finish rewriting the outline in time to start the assessment in February." The government, too, intends to comply with Okinawa's request, with a senior official saying, "The governor's view must be respected. If the prefectural side needs additional information, we will deal with the speedily." The government intends to confirm the implementation of the assessment with the Okinawa prefectural government and affected municipalities at the Futenma relocation consultative meeting, to be held in early February. MOD has also softened its stance, with its official saying, "We will deal with Okinawa more politely, proving it with additional information." 11) Former Vice Defense Minister Moriya admits to having given false Diet testimony; Prosecutors to bring charges again TOKYO SHIMBUN (Page 20) (Full) January 22, 2008 It was learned that former Administrative Vice Defense Minister Takemasa Moriya, 63, now under indictment, made a statement to the special investigation squad of the Tokyo Public Prosecutors Office admitting to committing perjury in testimony in the two chambers of the Diet. The special investigative task force plans to bring on Jan. 22 another accusation against Moriya for violation of the Diet Testimony Law, as well as for having received the special treatment of golf outings from Motonobu Miyazaki, former defense equipment trading house Yamada Corp. executive, 69, how has been under arrest. TOKYO 00000152 008 OF 011 Moriya stated in a House of Representatives Antiterrorism Special Committee session last November that he had paid 10,000 yen for a green fee every time when he played golf with Miyazaki, but he told the prosecutors that he had not paid the money. He also testified in a session in November of the House of Councillors Committee on Foreign Affairs and Defense: "I have paid from my own purse all the expenditures for my daughter's study abroad." However, Moriya's daughter used about 1.45 million yen sent from Miyazaki for her living costs (in the United States). The bribery amount Moriya received from Miyazaki is expected to total more than 10 million yen. 12) Assistance for training PKO personnel: Government to first provide funds to Africa NIKKEI (Page 2) (Full) January 19, 2008 The government will launch assistance to various foreign countries in their efforts to train peacekeeping operations (PKO) personnel. It will help them train and educate PKO personnel, by providing funds to PKO training centers in Africa and Asia through an international agency. This is part of efforts to make Japan a peace cooperation state as Prime Minister Fukuda advocated in his policy speech. The government thus wants to offer indirect assistance to countries, to which Japan cannot dispatch Self-Defense Forces personnel due to the restriction under the five PKO participation principles. As the first step, it will extend finance assistance to five PKO centers, training facilities, in Africa, such as Kenya and Egypt. It has already earmarked 1.8 billion yen in the supplementary budget for fiscal 2007 and will shortly outlay funds through the United Nations Development Program (UNDP). It will also look into the possibility of financing PKO centers in Asia, such as Thailand and Malaysia. 13) ODA experts' panel in interim report calls for increased aid for Africa SANKEI (Page 5) (Full) January 22, 2008 The experts' conference on international cooperation, an advisory panel to Foreign Minister Masahiko Koumura and chaired by Takushoku University President Toshio Watanabe, released its interim report on future options for the nation's official development assistance (ODA). The report emphasizes the importance of "strategy" and "message" in determining ODA projects. The report expresses concern about the recent significant reduction in the ODA budget, calling for expanding non-reimbursable aid to Africa. The interim report noted on Japan's aid for Africa: "When many other countries and organizations are boosting their ODA disbursements, Japan has halved its financial assistance over the past decade." It then suggests increasing the number of ODA projects in Africa based on grant aid in and after 2008 and establishing a consultative body composed of representatives from the government, private firms, and NGOs. TOKYO 00000152 009 OF 011 On measures to fight global warming, the report proposes that Japan should actively provide energy-conservation technology to poor countries that find it difficult to take countermeasures due to a lack of funds. As priority tasks, the report also lists the following: (1) cooperation between the government and the private sector, such as pooling citizens with rich experience abroad and dispatching them to poor countries; (2) government aid for investment and loan for development; and (3) studying offering loans on a foreign currency basis to diminish exchange risks from developing countries. 14) DPJ's Ozawa will not attend Davos Conference after all YOMIURI (Page 4) (Full) January 22, 2008 The Democratic Party of Japan (DPJ or Minshuto),the largest opposition party, is now at odds as party head Ichiro Ozawa gave up on his plan to attend the World Economic Forum (Davos Conference). The DPJ had carried out coordination, since there were views calling for Ozawa's attendance. Ozawa yesterday, however, told Secretary General Yukio Hatoyama to attend the international conference in his place. Diet Affairs Committee Chairman Kenji Yamaoka told reporters the reason for Ozawa having cancelled his plan: "His physical condition seems a bit bad. He may be tired from stumping in Osaka (supporting the candidate in the gubernatorial election)." Regarding Ozawa's flip-flop, a junior lawmaker pointed out: "The reality is that nobody in the DPJ can ask Mr. Ozawa about his real intentions, as we are afraid of him." Although Hatoyama reportedly is enthusiastic about attending the Davos Conference, there is an icy view in the party, with one member saying, "What is he going to do there? He will only expose his lack of preparations." 15) Economic Minister Ota in speech: Japanese economy can no longer be called first-class MAINICHI (Page 1) (Full) January 19, 2008 "The Japanese economy can no longer be called first-class." In her speech at the outset of the ordinary Diet session on Jan. 18, State Minister in Charge of Economic and Fiscal Policy Hiroko Ota unusually expressed a severe comment on the current state of the Japanese economy, causing a buzz of excitement in the hall. As the reason for her view, Ota cited: "The ratio of Japan's revenue to the world's total income dropped below 10 PERCENT in 2006 for the first time in 24 years. Gross domestic product (GDP) per capita also slipped into 18th place among the Organization for Economic Cooperation and Development (OECD) member countries." Japan's ratio was 17.9 PERCENT in 1994. This figure has been reduced by half, against the backdrop of slow growth in a deflationary economy and a weakening yen. After the speech, Ota stated: "Now that the world economy is undergoing significant changes, it is necessary for Japan to carry out reform to reinforce its growth dynamic, based on a hard look at what Japan will be like five or ten years from now." By stressing a TOKYO 00000152 010 OF 011 sense of alarm, she seems to have aimed to give momentum to reform. 16) Cabinet Office survey shows polarization among local areas, with 43 PERCENT saying their regions have vigor, and 53 PERCENT saying they do not MAINICHI (Page 3) (Full) January 20, 2008 According to the results of a special local revitalization survey, made public by the Cabinet Office, 53 PERCENT of the respondents said that their regions lacked vigor, an increase of 8 points from the previous survey conducted in June 2005. At the same time, 43 PERCENT of the respondents, up 4 points from the previous survey, said that their regions had vigor. The results thus pointed to polarization in local areas. The Cabinet Office conducted a face-to-face survey of 3,000 men and women over 20 years of age from last November through December. Valid answers came from 1,667 individuals. Figures by region have yet to be tallied. Gloomy answers came from over 50 PERCENT of the respondents, with 37.9 PERCENT -- the largest group -- saying that their regions more or less lacked vigor, up 8 points from the previous survey, and 15.3 PERCENT pointing to a complete lack of vigor. Meanwhile, 12.5 PERCENT said their regions had vigor, and 30.7 PERCENT indicated that their regions were somewhat vigorous -- both showing increases from the previous poll. 17) Russian banks to enter Japanese market as early as next year: More than 10 banks considering possibility MAINICHI (Page 1) (Full) January 21, 2007 It appears likely that Russian banks will for the first time enter the Japanese market as early as 2009. Russian Banks Association (RBA) President Garegin Tosunyan revealed this during an interview with the Mainichi Shimbun. The economy of Russia, the world's second largest crude-oil producer, is rapidly growing due to soaring crude oil prices. Russian banks are suffering only relatively minor damage from the U.S. subprime loan crisis. Assets held by Russian banks have reached close to 100 trillion yen. According to Tosunyan, more than 10 banks are considering opening branches in Japan. He revealed that Bank for Foreign Trade (VTB) and Rosbank, leading Russian banks, have already started considering such a possibility, noting, "I am sure Russian banks will enter the Japanese market." Japan's financial assets are a major attraction for Russian banks. Tosunyan also said that they are interested in Japan's advanced financial know-how. He then added that they will open branches in Japan once they obtain approval from the Japanese financial authorities and start businesses that focus on lending. They are also reportedly interested in taking part in money-lending services for individuals and the credit card business. The chances are that they might try to take a stake in Japanese companies. TOKYO 00000152 011 OF 011 Foreign banks are also setting up shop in Russia. However, Tosunyan underscored, "We must not increase the number of foreign banks operating Russia. If they advance into Russia, the governments of those foreign banks should also approve Russian banks operating in their countries." Russia's real growth rate for 2007 is expected to exceed 7 PERCENT . According to RBA, the total assets held by the banking industry are estimated to be approximately 21 trillion ruble (approximately 95 trillion yen). The figure is about five times the amount of five years ago. 18) Global warming preventive measures: Japan lowest among developed countries, dependency on coal blamed TOKYO SHIMBUN (Page 1) (Full) January 20, 2007 The World Bank has assessed progress of the implementation of measures to combat global warming taken by various countries and compiled the results as of Jan. 19. According the assessment, Japan ranked last among industrialized countries. It ranked 61st among the top 70 emitters. The major cause of the poor assessment result is attributable to the increased use of coal, which is cheap but emits a great deal of carbon dioxide (CO2),since the liberalization of the power supplying business in the latter half of the 1990. Many observers were of the opinion that Japan was on the top level in terms of energy efficiency. However, it is losing its edge as other countries are beginning to catch up with it. Japan has yet to increase the use of renewable energy, such as wind power. Its tendency to depend on coal remains unchanged with its coal usage in fiscal 2006 marking a 1.2 PERCENT increase from the previous year. The government will likely be urged to drastically review its approach to global warming, centering on its system of supplying electric power. The World Bank assessed various countries in terms of (1) the ratio of use of fossil fuels to the amount of energy used; (2) the ratio of oil and natural gas to the total amount of fossil fuels used; (3) energy usage per gross domestic product (GDP); (4) GDP per capita; and (5) population. It looked at the assessment results and whether there was an increase or decrease in CO2. It mapped out the survey results using figures and ranked the surveyed countries. The analysis of the results found that Japan's CO2 emissions have increased more than the level expected from its GDP and growth in its population. Among the 70 countries, 56 countries are shifting to natural gas and oil, which produce fewer emissions than coal. However, the use of coal in Japan has increased. As a result, its CO2 emissions have risen by approximately 42 million tons. Japan's use of energy per GDP is also increasing, while such in 49 countries, including the U.S., Germany, China and India, has decreased. The overall assessment of Japan was lowest among industrial countries. It even ranked lower than China and India. Denmark, Germany, Sweden and Britain occupied the top four spots. SCHIEFFER