JAPANESE MORNING PRESS HIGHLIGHTS 06/09/08

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E.O. 12958: N/A TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 06/09/08 Index: Political news: 1) Ruling parties lose majority in Okinawa assembly election as voters react against controversial medical plan for the elderly (Mainichii) 2) Government, ruling parties considering one-week extension of current session of Diet (Mainichi) 3) Former Prime Minister Mori says that Prime Minister Fukuda has no desire to shuffle his cabinet, despite press rumors he will do so (Yomiuri) 4) Former head of Democratic Party of Japan (DPJ) Maehara criticizes party president Ozawa in national journal article (Yomiuri) Energy ministers meeting in Aomori: 5) Secretary Bodman calls for investments that would increase oil supply (Nikkei) 6) G-8 plus 3 Energy Ministers Meeting closes in Aomori with joint statement (Asahi) 7) U.S., Japan, India, ROK energy ministers issue joint statement of concern about soaring oil price, urge more supply (Mainichi) 8) Energy minister call for joint government-private sector fund to promote innovative ideas in environmental and energy areas (Mainichi) 9) Japan to provide financial cooperation to build nuclear power plant in U.S. (Mainichi) North Korea problem: 10) Japan, North Korea to restart bilateral talks on June 11 (Nikkei) 11) Japan enters talks with North Korea, buttressed by U.S. pushing from behind for progress on abduction issue (Tokyo Shimbun) 12) Formal U.S., North Korea talks to restart June 11, with DPRK expected to press for removal of its name from U.S. terror-sponsor list (Mainichi) 13) Congressional Research Service report sounds warning against premature removal of North Korea from U.S. list of states sponsoring terrorism (Sankei) 14) LDP proposes bringing in 10 million immigrants into Japan, establishing immigration agency, and easing restrictions on naturalization (Yomiuri) Articles: 1) Ruling parties lose majority in Okinawa assembly election as voters react against controversial medical plan for the elderly MAINICHI (Internet edition) (Full) June 9, 2008 Okinawa residents went to the polls on June 8 to cast their votes for candidates in the prefectural assembly election (48 seats),in which the main campaign issue was the propriety of the medical system for the elderly over 75. The ruling camp's forces, made up of the Liberal Democratic Party (LDP),New Komeito and independent conservatives only won 22 seats, while the opposition parties, centered on the Democratic Party of Japan (DPJ),Social Democratic Party (SDP) and the Japanese Communist Party (JCP) took a majority of 26 seats, trading places to become the ruling camp. The turnout for the election was a record low 57.82 PERCENT , a 0.9 point drop TOKYO 00001558 002 OF 009 from the previous prefectural-assembly election in 2004, when it was 58.72 PERCENT . On the issue of the relocation of Futenma Air Station, Governor Hirokazu Nakaima has gone along with moving the base to a site on the coast of Camp Schwab in Nago City, with conditions. In contrast, the opposition camp has opposed relocation within the prefecture. The result of this election is likely to have an impact on the relocation. In the current election, the two campaign issues were the propriety of the medical system for the elderly, which is a national policy problem, and the relocation of Futenma Air station, which the governor approves. Party leaders from both the ruling and opposition camps came to Okinawa one after the other to stump, but it appears that the tail wind for the opposition that allowed it to pick up seats was the medical-service issue. A break down of the ruling camp's wins by party gives the LDP 16 seats, the New Komeito 3 seats, and independents 3 seats. In the opposition camp, the JCP won 5 seats, the SDP also took 5 seats, and the DPJ came in with 4 seats. In addition, other minor parties won 3 seats, and independents favoring the opposition took 6 assembly seats. Prior to the election, the then ruling camp had 27 seats, holding a majority on the assembly. 2) Ruling bloc considering extending Diet session by one week MAINICHI (Page 2) (Full) June 8, 2008 The government and ruling parties yesterday began considering extending the current Diet session, scheduled to close on June 15, by about one week, according to sources connected with the government and ruling bloc. The reason is that the major opposition Democratic Party of Japan has decided to submit a censure motion against Prime Minister Fukuda to the Upper House on June 11. The planned extension is aimed at preventing Diet approval of six treaties from being carried over to the next Diet session after Upper House deliberations on them stall. In accordance with a constitutional provision stipulating the precedence of a Lower House decision, a treaty automatically wins Diet approval after 30 days of its passage of the Lower House. Nevertheless, the Diet must be in session. The six treaties passed the Lower House between May 20 and 22. An LDP executive said to reporters yesterday, "If the session is extended until June 21, they will automatically clear the Diet." 3) Yoshiro Mori: Prime Minister Fukuda has no intention to shuffle cabinet YOMIURI (Page 4) (Full) June 7, 2008 Former Prime Minister Yoshiro Mori, a member of the ruling Liberal Democratic Party (LDP),appeared on June 6 on a TBS program, which will be aired at a later date. In it, asked about the possibility of a cabinet shuffle after the Group of Eight summit in July in TOKYO 00001558 003 OF 009 Hokkaido, Mori said: "I have said that (a cabinet shakeup) on Prime Minister Fukuda's own decision would be good, but it seems me he has no such intention." Referring to the fact that Democratic Party of Japan (DPJ) President Ichiro Ozawa has tried to force a dissolution of the House of Representatives as early as the fall, Mori pointed out: "If the cabinet is shuffled, a snap election will be held to ask for a vote of confidence after the (dissolution of the Lower House). It is unnecessary to conduct an (election) on the enemy's timetable." Mori had shown a positive stance toward an early cabinet shuffle. 4) DPJ's Maehara criticizes Ozawa's manifesto for last year's Upper House election YOMIURI (Page 4) (Full) June 8, 2008 Seiji Maehara, former president of the Democratic Party of Japan (DPJ),engaged in a dialogue with former Chief Cabinet Secretary Kaoru Yosano in the monthly magazine Chuo Koron's July issue, which will go on sale on June 10. In it, Maehara voiced doubts about the feasibility of his party's manifesto (set of campaign pledges) for last year's House of Councillors election, which was compiled under the initiative of President Ichiro Ozawa. He said: "Should the DPJ hold the reins of government as things stand, the party will not be able to decently manage the government. The DPJ's manifesto stated that 15.3 trillion yen would be needed to implement major policy measures, including compensation for individual farmers, and that this would be covered by abolishing subsidies. Maehara asserted that about 18 trillion yen would be needed if additional pledges such as the scrapping of provisional taxes for road construction and maintenance were added. He pointed out the responsibility of Ozawa for signing on to such plans. He noted: "It would be impossible to come up with such fiscal resources by administrative reform alone. I heard that some members who were in charge of drafting the manifesto were reluctant to accept it when mapping it out, citing as the reason that the grounds for such fiscal resources were insufficient. But Mr. Ozawa gave it the go-ahead." Maehara also stressed the need to substantially revise the manifesto: "What the DPJ must avoid is just talking about policy measures in order to please the public and then later say that we were unable to carry them out when we are at the political helm. If so, power will immediately return to the Liberal Democratic Party (LDP). Such will be the worst thing possible." In a meeting on June 7 in Kyoto, Maehara stated: "There is criticism of the compensation scheme for individual farmers as a waste of public funds. I strongly agree." 5) U.S. Secretary of Energy Bodman calls for greater investment to increase oil supply TOKYO 00001558 004 OF 009 NIKKEI Online 20:07, June 7, 2008 U.S. Secretary of Energy Samuel W. Bodman, currently attending the G-8 Energy Ministerial and related meetings, held a group press interview including with the Nihon Keizai Shimbun on the morning of June 7 in Aomori City. Commenting on the steep rise in crude oil prices, Secretary Bodman said, "The flat supply of oil is the cause of the unstable market. I hope adequate investments (to expand oil production) will be made." Responding to a comment that speculative capital is a factor in the current high level of crude oil prices, the secretary said, "It is not due to such a financial factor." Secretary Bodman added that there was a structural factor behind the high crude oil prices: "The supply of crude oil has not increased for the past three years, even though there is growing demand for oil production." 6) G-8 plus China, India and South Korea energy ministerial closes, adopting Aomori Declaration Asahi.com 17:56, June 8, 2008 Energy ministers from the Group of Eight (G-8) Nations, China, India and South Korea closed on June 8, adopting an Aomori Declaration, which incorporates concern about the steep rise in crude oil prices and a call for facilitating energy-conservation measures. Representatives from the G-8 at a separate meeting agreed to launch by 2050 a total of 20 large-scale demonstration projects to look into CO2 underground storage. The Declaration consists of four joint statements. Concerning the present steep rise in crude oil prices, a joint statement issued by the 11 countries called for cooperation from all countries, noting, "The situation is abnormal and against the interests of both consumer and producer countries." The statement gave a high score to the sector-specific approach on reducing greenhouse gas emissions, a method for industry-wide technical transfers proposed by Japan. Noting that the 11 countries will make a concerted effort for the practical application of the proposed approach, the statement indicated their determination to analyze and gauge the present state of energy-conserving measures and facilitate the selection of technologies to be transferred. The 11 countries also agreed to map out voluntary country-specific goals and action programs for the promotion of energy-conserving policy and the development of clean energies. As a venue for conferring on those energy-saving policies, they will set up a new international framework "International Partnership for Energy Efficiency Cooperation (IPEEC). This will be the first framework involving China and India as well as Japan, the U.S. and Europe. 7) Energy ministerial: Five countries adopt joint statement expressing concern over soaring oil prices and calling for greater supply MAINICHI (Page 2) (Abridged slightly) June 8, 2008 A meeting on June 7 of energy ministers of Japan, the United States, TOKYO 00001558 005 OF 009 China, India and South Korea adopted a joint statement expressing strong concern about soaring oil prices, saying, "The current level of oil prices is unprecedented and against the interest of both consuming and producing countries." As countermeasures, the statement underlines the need for major consuming countries to work together to promote energy conservation, while urging producers to expand supply capacity. Crude oil prices have reached record levels, with the WTI price closing in on 140 dollars a barrel on June 6. Pointing out that skyrocketing oil prices place heavy burdens on resource-poor developing countries, the statement urges producing countries to increase investments (for greater production) to achieve sufficient supply. The statement also specifies the need for consuming countries to enhance their domestic policies in order to significantly increase their energy efficiency. In addition, outlining steps to beef up emergency measures, such as stockpiling oil, the statement also highlights the need for International Energy Agency member countries to take steps, such as releasing emergency stockpiles, in cooperation with China and India. The statement also says that it is desirable for China and India to gradually abolish their subsidy systems to curb prices of energy-related products. On June 8, the energy ministers of 11 countries -- the Group of Eight plus China, India, and South Korea -- will hold their meeting. 8) Government to establish government-private fund for environment and energy MAINICHI (Top play) (Abridged) June 8, 2008 The government decided yesterday to establish what is tentatively called the Innovation Creation Organization, a government-private fund to promote corporatization by putting together cutting-edge technologies in growing areas, such as the environment and energy, possessed by universities, small ventures and leading companies at home and abroad. The new framework is designed to combine top-notch business-government-academic personnel beyond boundaries to selectively provide funds to innovative technologies in the environment, energy and other areas from a long-term perspective. By fostering strong technologies, the government intends to increase the country's economic competitiveness internationally. As the first step to rebuilding an economic structure of the 21st century, Prime Minister Fukuda is expected to order on June 9 Economy, Trade and Industry Minister Amari to come up with a specific plan to establish the envisaged organization. The organization will be incorporated in the 2008 basic policy guidelines to be crafted in ate June. Over 200 billion yen funded by the government and the private sector, the Innovation Creation Organization will be run as a stock company. It will be run by private-sector personnel well-versed in economic, financial and technological affairs. Besides the government, funds will be solicited from a wide range of sources, including foreign sovereign wealth funds. Sub-funds by theme will be established under the organization's TOKYO 00001558 006 OF 009 umbrella to provide them with funds and personnel. The organization will combine technologies and personnel possessed by leading companies and buy promising yet financially-troubled ventures to lead them corporatization. It will further put together technologies possessed by small ventures and provide them with funds to promote the development of new technologies. Once businesses are put on track, the government will sell its share to the private-sector to make profits. Planning to establish the organization in next fiscal year as a 10- to 15-year project, the government intends to submit related bills to next's regular Diet session. 9) Japan to extend financial cooperation for construction of U.S. nuclear plants MAINICHI (Page 2) (Full) June 8, 2008 The governments of Japan and the United States released on June 7 a joint nuclear cooperation statement specifying their decision to use Nippon Export and Investment Insurance (NEXI) and the Japan Bank for International Cooperation (JBIC) in funding a project to build new nuclear power plants in the United States. An agreement was reached as a result of talks in Aomori City between Economy, Trade and Industry Minister Akira Amari and U.S. Secretary Energy Samuel Bodman. The United States has a plan to build over 30 nuclear reactors, but raising funds for them has been a challenge. Given the situation, NEXI and JBIC will consider financial assistance, and increased opportunities for Japanese companies to join the project are also expected. 10) Japan, N. Korea to resume talks June 11-12 NIKKEI (Page 2) (Full) June 9, 2008 BEIJING-Japan and North Korea held a meeting of working-level officials yesterday afternoon at the Japanese embassy in Beijing to resume negotiations for diplomatic normalization. Japan insisted again that it is extremely important for Japan and North Korea to see progress on the issue of Japanese nationals abducted to North Korea, and called for North Korea to take specific action at an early date. Japan and North Korea did not hold in-depth talks and agreed to enter into full-fledged talks in Beijing on June 11-12. In the working-level meeting were six officials from Japan, including the Foreign Ministry's Asian and Oceanian Affairs Bureau Director General Akitaka Saiki. From North Korea were seven officials, including Song Il Ho, ambassador for negotiations over the normalization of diplomatic relations between North Korea and Japan. The meeting this time was for informal consultations and ended after two hours and 40 minutes. Japan and North Korea will enter into formal consultations, beginning with the next round of talks. "We talked about many things, including the present state of bilateral relations between Japan and North Korea and what we should do from now on," Saiki told reporters after the meeting. "They also said we should see progress," he added. On the abduction issue, Saiki said, "We told them that we hope North TOKYO 00001558 007 OF 009 Korea would make a decision and show something specific for us in the next round of talks." His North Korean counterparts were "taking note while listening" to him, according to Saiki. However, Japan and North Korea did not hold in-depth discussions, he added. One of the prime minister's aides said late at night that there was no specific progress in the meeting. However, this aide also said, "I heard that this time they didn't say the abduction issue has already been settled." Japan and North Korea held talks for the first time in about eight months since the two countries held a meeting in Shenyang, China in October last year. This time, the two countries gave first consideration to resuming talks between their working-level officials and forwent full-fledged talks over the abduction issue and past issues, such as the liquidation of issues in the past. They also did not talk about the issue of sending Japan Airlines hijackers back to Japan, according to government sources. The future course of consultations between Japan and North Korea is closely intertwined with the process of North Korea's nuclear abandonment in the six-party talks. The six-party talks are now in the final stage of "second-phase steps," including North Korea's declaration of its nuclear programs. North Korea has called for the United States to delist North Korea as a state sponsor of terrorism in return. However, the United States has urged North Korea to move Japan-North Korea relations forward. A government source said, "The United States told North Korea to work hard on its issues with Japan, so I guess North Korea reluctantly made up its mind to do so." 11) Formal talks with North Korea to be resumed: U.S. calls on Pyongyang to come to negotiating table to move abduction issue forward TOKYO SHIMBUN (Page 3) (Excerpts) June 8, 2008 Japan and North Korea during informal talks on June 7 agreed to hold a formal working-level meeting. Following the agreement, the government intends to press Pyongyang to come up with concrete measures regarding the issue of the abduction of Japanese nationals by North Korea. However, the future course of the envisaged talks is unclear, because the two countries had been in direct opposition in past talks when it came to specific matters. One senior Japanese government official said, "The North Korean side even before the informal talks said the talks would be for a very short time. The envisaged talks are for us to exchange opinions on what to do in the future." The Japanese side had viewed that concrete talks on the abduction issue and North Korea's nuclear arms program would be held at a formal meeting. Formal talks between the two countries have been suspended since the working group meeting on Japan-North Korea normalization talks under the six-party talks held in Mongolia in September last year. It is viewed that North Korea has agreed to hold formal talks with Japan mainly because of U.S. urgings, a senior Foreign Ministry official revealed. The U.S. is seeking Japan and North Korea to improve their relations as a premise for it to delist Pyongyang from TOKYO 00001558 008 OF 009 its list of state sponsors of terrorism. However, the Japanese side is concerned that North Korea may try to be removed from the list by only showing its eagerness to respond to the call for talks, with the abduction issue making little progress. 12) Japan, DPRK to restart formal talks, influenced by U.S. pressure, with the possibility of the U.S. removing North Korea from its list of terrorist-sponsoring states MAINICHI (Page 3) (Abridged) June 8, 2008 Beijing Japan and North Korea agreed yesterday to restart formal working-level talks on June 11-12. The agreement was greatly influenced by the changing situation, in which the final stage, or "second-stage measures," under the Six Party Talks, with North Korea reporting its nuclear programs, will be reached, and the possibility then of the United States removing North Korea from its list of states sponsoring terrorism. In every negotiation with North Korea, the U.S. has been urging the North to reach a breakthrough in its relations with Japan. The U.S. has been working on Pyongyang as a condition of its removing North Korea from the terrorist-sponsoring list, to make progress in relations with Japan. Following the informal talks between working-level officials of the U.S. and North Korea held in Beijing on the 7th, Asia-Pacific Bureau Director General Saiki of the Foreign Ministry stressed the current situation: "We talked about what would be best for Japan-North Korean relations as part of the mechanism of the Six-Party Talks." North Korea is motivated by a desire to win the U.S.' good will so that its name will be removed from the terror-sponsoring list. A diplomatic source in Beijing said, "The leadership recognizes that progress on the abduction front would lead to removal of North Korea's name from the terrorist-sponsoring list." In order to avoid a stalemate in Japan-DPRK relations blocking the removal of the designation, North Korea seems to have judged that it needs to show a stance of responding at the very least to the talks. There is still a deep-seated view of skepticism about how serious North Korea is on this issue. In reality, when Saiki in the informal talks stressed the importance of resolving the abduction issue, Song Il-ho, the North Korean ambassador in charge of normalization of relations took notes assiduously, but reportedly never uttered a positive statement. He and other officials seems to have wanted just to appeal to the U.S. and other parties that Japan and the DPRK were negotiating. For that reason, Saiki in the informal talks sought to nail down the issue with the North Korean side by saying, "In the next round of talks, we hope to reach a decision on the abduction issue by handling it in a concrete manner." The U.S., too, apparently will not respond by making a decision to remove the North from the list only by the two sides carrying out talks. There is no change in the situation of it seeking progress from the North on that issue. 13) Negative impact on Japan-U.S. relations: CRS report TOKYO 00001558 009 OF 009 SANKEI (Page 5) (Abridged) June 9, 2008 Takashi Arimoto, Washington The U.S. Congressional Research Service (CRS) has released a report on the issue of delisting North Korea as a state sponsor of terrorism, warning that it could have a negative impact on Japan-U.S. relations and could cause North Korea to continue or expand its support for terrorist groups in the Middle East. The CRS report quotes a Japanese government official as warning that delisting North Korea without substantive progress on the pending issue of Japanese abductees would impair Japan-U.S. relations in the short term. The report also indicates that delisting North Korea, in the long term as well, could affect the Japanese government's policy toward the U.S. military presence in Japan and could also impact Japan's support for U.S. military operations against terrorist groups. 14) LDP lawmakers propose accepting up to 10 million immigrants, establishing immigration agency, easing requirements for naturalization YOMIURI (Page 4) (Full) June 9, 2008 A set of proposals compiled by a group of Liberal Democratic Party (LDP) lawmakers, which advocates promotion of exchanges of skilled foreign workers, was revealed yesterday. The group is headed by former LDP Secretary General Hidenao Nakagawa. The draft says that in order to strengthen Japan's strength the country needs to greatly accept immigrants since its population will continue to decrease. It stipulates that Japan should aim to become a multiethnic state (with about 10 million immigrants) or 10 PERCENT of Japan's population over next 50 years. The group will formally adopt the set of proposals and present it to Prime Minister Yasuo Fukuda next week. The 10 million immigrants would amount to a 12 fold increase over the present population of foreign residents (870,000),including general and special permanent residents. The group suggests establishing an immigration law, which would call for Japan becoming a multi-ethnic state with many immigrants, and propose the establishment of an immigration agency. It also proposes that local governments create a system under which they would be able to easily provide foreigners residing in Japan with services, such as a registry network for foreigners. The group suggests that the restriction on acquiring permanent residency be eased to 7 years from the present 10 years or more, and that the naturalization system be revised so that foreigners living in Japan for at least 10 years would be able to obtain Japanese citizenship. SCHIEFFER