Identifier
Created
Classification
Origin
08TOKYO2798
2008-10-07 08:06:00
UNCLASSIFIED
Embassy Tokyo
Cable title:  

DAILY SUMMARY OF JAPANESE PRESS 10/07/08

Tags:  OIIP KMDR KPAO PGOV PINR ECON ELAB JA 
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UNCLAS SECTION 01 OF 12 TOKYO 002798 

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 10/07/08

INDEX:


(1) Poll on Aso cabinet, political parties (Asahi)

(2) In Lower House Budget Committee session, prime minister
highlights the need to set points at issue, such as continuation of
Indian Ocean refueling mission, before heading for Lower House
dissolution (Yomiuri)

(3) Offshore move difficult: Masuda (Ryukyu Shimpo)

(4) New source of trouble emerges for Iwakuni; Central government
may have sounded out city on construction of U.S. military housing;
City keeps its silence, ignoring citizens' right to know (Tokyo
Shimbun)

(5) Interview with Eisuke Sakakibara, professor at Waseda
University: Largest-scale postwar financial crisis still only at the
second station (on the mountain) (Asahi)

(6) Editorial: New JICA should give considerable thought to
strategic ODA (Yomiuri)

(7) 160 North Korean defectors quietly entered Japan; Government
does not recognize them officially (Asahi)

(8) TOP HEADLINES

(9) EDITORIALS

(10) Prime Minister's schedule, October 6 (Nikkei)

ARTICLES:

(1) Poll on Aso cabinet, political parties

ASAHI (Page 4) (Full)
October 7, 2008

Questions & Answers
(Figures shown in percentage, rounded off. Bracketed figures denote
proportions to all respondents. Figures in parentheses denote the
results of the last survey conducted Sept. 24-25.)

Q: Do you support the Aso cabinet?

Yes 41 (48)
No 42 (36)

Q: Why? (One reason only. Left column for those marking "yes" on
previous question, and right for those saying "no.")

The prime minister is Mr. Aso 32(13) 5(2)
It's an LDP-led cabinet 26(11) 43(18)
From the aspect of policies 24(10) 27(11)
Cabinet lineup 9(4) 21(9)

Q: Which political party do you support now?

Liberal Democratic Party (LDP) 32 (34)
Democratic Party of Japan (DPJ or Minshuto) 23 (23)

TOKYO 00002798 002 OF 012


New Komeito (NK) 4 (3)
Japanese Communist Party (JCP) 2 (2)
Social Democratic Party (SDP or Shaminto) 1 (1)
People's New Party (PNP or Kokumin Shinto) 0 (0)
Reform Club (RC or Kaikaku Kurabu) 0
New Party Nippon (NPN or Shinto Nippon) 0 (0)
Other political parties 0 (0)
None 31 (32)
No answer (N/A) + don't know (D/K) 7 (5)

Q: There will be a general election shortly for the House of
Representatives. To what extent are you interested in the general
election this time? (One choice only)

Very interested 35
Somewhat interested 44
Not very interested 17
Not interested at all 3

Q: If you were to vote now in a general election for the House of
Representatives, which political party would you like to vote for in
your proportional representation bloc?

LDP 33 (36)
DPJ 34 (32)
NK 4 (4)
JCP 3 (4)
SDP 1 (1)
PNP 0 (0)
RC 0
NPN 0 (0)
Other political parties 1 (1)
N/A+D/K 24 (22)

Q: In your single-seat electoral district, which political party's
candidate would you like to vote for?

LDP 31
DPJ 30
NK 3
JCP 3
SDP 1
PNP 0
RC 0
NPN 0
Other political parties 0
Independent 2
N/A+D/K 30

Q: Would you like the current LDP-led coalition government to
continue, or would you otherwise like it to be replaced with a
DPJ-led coalition government?

LDP-led coalition 34 (39)
DPJ-led coalition 40 (40)

Q: Which one between Prime Minister Aso and DPJ President Ichiro
Ozawa do you think is more appropriate for prime minister?

Mr. Aso 50 (54)
Mr. Ozawa 22 (26)


TOKYO 00002798 003 OF 012


Q: Do you think it would be better for Japan to have the ruling and
opposition parties change places at times?

Yes 73 (73)
No 19 (21)

Q: Land, Infrastructure and Transport Minister Nariaki Nakayama
resigned five days after assuming his cabinet post as he was
criticized for a series of gaffes. Do you think the responsibility
of Prime Minister Aso, who appointed Mr. Nakayama, is big, or do you
otherwise think it is not so big?

Big 44
Not so big 48

Polling methodology: The survey was conducted Oct. 4-5 over the
telephone on a computer-aided random digit dialing (RDD) basis.
Respondents were chosen from among the nation's voting population on
a three-stage random-sampling basis. Valid answers were obtained
from 1,036 persons (57 PERCENT ).

(2) In Lower House Budget Committee session, prime minister
highlights the need to set points at issue, such as continuation of
Indian Ocean refueling mission, before heading for Lower House
dissolution

YOMIURI NET (Full)
1:44, October 7, 2008

At a Lower House Budget Committee meeting this morning, Prime
Minister Taro Aso said this in connection with Lower House
dissolution for a snap general election: "In dealing with the
Democratic Party of Japan, we must set the points at issue. It is
necessary to make it clear which party (the LDP or DPJ) has the
ability to run the government after clarifying (the thinking) about
Japan's international contribution and other matters."

Since the DPJ is opposed to the extension of the Maritime
Self-Defense Force's refueling mission in the Indian Ocean, Aso set
a policy course of only moving on to the next Lower House election
after exposing through Diet deliberations the difference in views
between the two parties on Japan's international contributions.

About the timing for dissolving the Diet, the prime minister simply
said: "I do not have any specific date in mind. We must cherish the
votes given to us (in the 2005 Lower House election). I will make a
decision on (whether) to dissolve the Lower House immediately after
giving it thorough consideration."

Regarding the fact that the LDP Diet Affairs Committee ordered
government agencies to consult with it in advance on opposition
parties' requests for data, the prime minister reiterated the view
that a decision on the contents of data (to be presented) is to be
made by each cabinet minister and that such does not constitute a
review by the LDP." Agriculture, Forestry, and Fisheries Minister
Shigeru Ishiba, too, said: "We have never asked for (the LDP Diet
Affairs Committee's) permission in advance for the provision of
data. We will not do such in the future, either."

(3) Offshore move difficult: Masuda

RYUKYU SHIMPO (Page 2) (Full)

TOKYO 00002798 004 OF 012


October 7, 2008

TOKYO-The Defense Ministry's Administrative Vice Minister Kohei
Masuda, now back from his official trip to Okinawa last weekend,
stated in a press conference yesterday at the Defense Ministry that
the government would go through various procedures for the planned
relocation of the U.S. military's Futenma airfield in the prefecture
and would like to push ahead with the Futenma relocation plan while
listening well to local requests. The government plans to build an
alternative facility for Futenma airfield in a coastal area of Camp
Schwab in the prefecture's northern coastal city of Nago. Meanwhile,
Okinawa Gov. Hirokazu Nakaima and Nago Mayor Yoshikazu Shimabukuro
have requested the alternative facility's construction site be moved
out into the sea. Asked about this proposal, Masuda answered: "Our
present plan is balanced in consideration of the environment and
various other aspects. It would be quite difficult (to move the site
offshore) without rational cause."

(4) New source of trouble emerges for Iwakuni; Central government
may have sounded out city on construction of U.S. military housing;
City keeps its silence, ignoring citizens' right to know

TOKYO SHIMBUN (Pages 20 & 21) (Abridged slightly)
October 6, 2008

By Chiaki Ueda

A new controversial issue has emerged for the city of Iwakuni in
Yamaguchi Prefecture, which is being shaken by the realignment of
U.S. forces in Japan. The existence of a document has come to light
that shows the city had been informally asked by the central and
prefectural governments about the construction of U.S. military
housing at the Atagoyama area. The city, which has denied any
approach by them, is holding its silence. Will the citizens' right
to know be protected?

City assemblyman Yoshihiro Watari said in a strong tone with a copy
of the document in his hand: "The city said in June that there had
been no approach by the central government or the prefectural
government. The city told us a big lie." In September, like-minded
city and prefectural assemblymen, including Watari, disclosed a copy
of the document that have fallen into their hands following some
news reports, saying that it was clear that there had been an
informal request about the construction of U.S. military housing and
that concealing it would put the citizens at a disadvantage.

The document consists of the minutes of three sets of discussions:
talks among city officials; talks with prefectural officials; and
talks with prefectural and prefecture housing corporation officials.
They all discussed the use of Atagoyama area. The document notes
that it was produced by the Atagoyama area development office.

The talks reportedly held at the mayor's office on April 7, 2008
were attended by Mayor Yoshihiko Fukuda, Deputy Mayor Kuniyasu
Otomo, and senior officials of departments responsible for the
Iwakuni base and Atagoyama. Their discussion centered on the fact
that the prefectural and central governments had tried to confirm
the mayor's intent.

According to the minutes, the base division director first said:
"There were calls from the prefectural government and the Defense
Ministry urging us to confirm quickly the mayor's intent." The

TOKYO 00002798 005 OF 012


minutes also include some statements on the city's request to the
central government for the resumption of the civilian airport at the
Iwakuni base. The division director said: "In order to resume the
civilian airport, they pointed out the need to have (the mayor's)
clear intent to endorse the construction of U.S. military housing."
The mayor then asked: "The civilian airport, U.S. military housing,
and Atagoyama. It is going to be a trade-off?" The division director
replied, "Yes, it is going to be a trade-off."

One asked, "Why does Iwakuni have to pay such a price for securing
U.S. military housing?" Another city official noted: "I cannot bear
to offer an explanation to the local residents." Still another
commented: "In view of the sentiment of local residents, selling the
area for U.S. military housing is difficult." Those comments alluded
to the city's agony.

The Atagoyama development project began in 1998. It was pushed
forward in tandem with a plan to move the Iwakuni base runway 1
kilometer offshore with the aim of reducing noise at the base. The
blueprint was to reclaim the planned new base area with earth and
sand from Atagoyama and redevelop the Atagoyama area to build 1,500
housing units for 5,600 people on the 60-ha land.

The prefectural government, prefectural housing corporation, and
city government decided in June 2007 to halt the project, citing
diminished demand due to a change in the economic situation.
Planning to relocate a national hospital to and selling one-fourth
of the land to the civilian sector, they have asked the central
government to purchase the remaining three-fourths of the 60-ha
land. The prefectural government is asking the central government to
procure the site, saying the prefecture has cooperated on the
government's project. The Defense Ministry, on the other hand, says
that it is still at the stage of collecting information.

Since the document was disclosed, the city has taken an odd stance.
Although the city has admitted that there had been a meeting on the
date specified in the document and the meeting had resulted in a
memo, an Atagoyama area development office official said: "We do not
know if the disclosed document was drafted by the city, so we cannot
make any comment on it."

The document, which specifies the names of attendants, the date,
venue, and who said what at the meeting, does not look like a memo.
Why does the city refuse to refer to the document so adamantly?

Katsusuke Ihara, who served as Iwakuni mayor from 1999 until he was
defeated by Fukuda in the February 2008 mayoral race, explained:
"There is no other place but Atagoyama to build U.S. housing for
4,000 people. The central government indirectly asked the city as
early as several years ago. It is natural to think that the city cut
a secret deal behind the scenes. The city cannot admit that there
was an informal request because such would make it a liar." Although
the central and prefectural governments have denied any informal
request to the city, chances are slim for them to sell the land to
the civilian sector. Building U.S. military housing is the most
likely scenario. The prefectural and city governments are 24.4
billion yen in dept because of the halted project. They are supposed
to compensate for it 2 to
UNCLAS SECTION 01 OF 12 TOKYO 002798 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 10/07/08 INDEX: (1) Poll on Aso cabinet, political parties (Asahi) (2) In Lower House Budget Committee session, prime minister highlights the need to set points at issue, such as continuation of Indian Ocean refueling mission, before heading for Lower House dissolution (Yomiuri) (3) Offshore move difficult: Masuda (Ryukyu Shimpo) (4) New source of trouble emerges for Iwakuni; Central government may have sounded out city on construction of U.S. military housing; City keeps its silence, ignoring citizens' right to know (Tokyo Shimbun) (5) Interview with Eisuke Sakakibara, professor at Waseda University: Largest-scale postwar financial crisis still only at the second station (on the mountain) (Asahi) (6) Editorial: New JICA should give considerable thought to strategic ODA (Yomiuri) (7) 160 North Korean defectors quietly entered Japan; Government does not recognize them officially (Asahi) (8) TOP HEADLINES (9) EDITORIALS (10) Prime Minister's schedule, October 6 (Nikkei) ARTICLES: (1) Poll on Aso cabinet, political parties ASAHI (Page 4) (Full) October 7, 2008 Questions & Answers (Figures shown in percentage, rounded off. Bracketed figures denote proportions to all respondents. Figures in parentheses denote the results of the last survey conducted Sept. 24-25.) Q: Do you support the Aso cabinet? Yes 41 (48) No 42 (36) Q: Why? (One reason only. Left column for those marking "yes" on previous question, and right for those saying "no.") The prime minister is Mr. Aso 32(13) 5(2) It's an LDP-led cabinet 26(11) 43(18) From the aspect of policies 24(10) 27(11) Cabinet lineup 9(4) 21(9) Q: Which political party do you support now? Liberal Democratic Party (LDP) 32 (34) Democratic Party of Japan (DPJ or Minshuto) 23 (23) TOKYO 00002798 002 OF 012 New Komeito (NK) 4 (3) Japa
nese Communist Party (JCP) 2 (2) Social Democratic Party (SDP or Shaminto) 1 (1) People's New Party (PNP or Kokumin Shinto) 0 (0) Reform Club (RC or Kaikaku Kurabu) 0 New Party Nippon (NPN or Shinto Nippon) 0 (0) Other political parties 0 (0) None 31 (32) No answer (N/A) + don't know (D/K) 7 (5) Q: There will be a general election shortly for the House of Representatives. To what extent are you interested in the general election this time? (One choice only) Very interested 35 Somewhat interested 44 Not very interested 17 Not interested at all 3 Q: If you were to vote now in a general election for the House of Representatives, which political party would you like to vote for in your proportional representation bloc? LDP 33 (36) DPJ 34 (32) NK 4 (4) JCP 3 (4) SDP 1 (1) PNP 0 (0) RC 0 NPN 0 (0) Other political parties 1 (1) N/A+D/K 24 (22) Q: In your single-seat electoral district, which political party's candidate would you like to vote for? LDP 31 DPJ 30 NK 3 JCP 3 SDP 1 PNP 0 RC 0 NPN 0 Other political parties 0 Independent 2 N/A+D/K 30 Q: Would you like the current LDP-led coalition government to continue, or would you otherwise like it to be replaced with a DPJ-led coalition government? LDP-led coalition 34 (39) DPJ-led coalition 40 (40) Q: Which ONE between Prime Minister Aso and DPJ President Ichiro Ozawa do you think is more appropriate for prime minister? Mr. Aso 50 (54) Mr. Ozawa 22 (26) TOKYO 00002798 003 OF 012 Q: Do you think it would be better for Japan to have the ruling and opposition parties change places at times? Yes 73 (73) No 19 (21) Q: Land, Infrastructure and Transport Minister Nariaki Nakayama resigned five days after assuming his cabinet post as he was criticized for a series of gaffes. Do you think the responsibility of Prime Minister Aso, who appointed Mr. Nakayama, is big, or do you otherwise think it is not so big? Big 44 Not so big 48 Polling methodology: The survey was conducted Oct. 4-5 over the telephone on a computer-aided random digit dialing (RDD) basis. Respondents were chosen from among the nation's voting population on a three-stage random-sampling basis. Valid answers were obtained from 1,036 persons (57 PERCENT ). (2) In Lower House Budget Committee session, prime minister highlights the need to set points at issue, such as continuation of Indian Ocean refueling mission, before heading for Lower House dissolution YOMIURI NET (Full) 1:44, October 7, 2008 At a Lower House Budget Committee meeting this morning, Prime Minister Taro Aso said this in connection with Lower House dissolution for a snap general election: "In dealing with the Democratic Party of Japan, we must set the points at issue. It is necessary to make it clear which party (the LDP or DPJ) has the ability to run the government after clarifying (the thinking) about Japan's international contribution and other matters." Since the DPJ is opposed to the extension of the Maritime Self-Defense Force's refueling mission in the Indian Ocean, Aso set a policy course of only moving on to the next Lower House election after exposing through Diet deliberations the difference in views between the two parties on Japan's international contributions. About the timing for dissolving the Diet, the prime minister simply said: "I do not have any specific date in mind. We must cherish the votes given to us (in the 2005 Lower House election). I will make a decision on (whether) to dissolve the Lower House immediately after giving it thorough consideration." Regarding the fact that the LDP Diet Affairs Committee ordered government agencies to consult with it in advance on opposition parties' requests for data, the prime minister reiterated the view that a decision on the contents of data (to be presented) is to be made by each cabinet minister and that such does not constitute a review by the LDP." Agriculture, Forestry, and Fisheries Minister Shigeru Ishiba, too, said: "We have never asked for (the LDP Diet Affairs Committee's) permission in advance for the provision of data. We will not do such in the future, either." (3) Offshore move difficult: Masuda RYUKYU SHIMPO (Page 2) (Full) TOKYO 00002798 004 OF 012 October 7, 2008 TOKYO-The Defense Ministry's Administrative Vice Minister Kohei Masuda, now back from his official trip to Okinawa last weekend, stated in a press conference yesterday at the Defense Ministry that the government would go through various procedures for the planned relocation of the U.S. military's Futenma airfield in the prefecture and would like to push ahead with the Futenma relocation plan while listening well to local requests. The government plans to build an alternative facility for Futenma airfield in a coastal area of Camp Schwab in the prefecture's northern coastal city of Nago. Meanwhile, Okinawa Gov. Hirokazu Nakaima and Nago Mayor Yoshikazu Shimabukuro have requested the alternative facility's construction site be moved out into the sea. Asked about this proposal, Masuda answered: "Our present plan is balanced in consideration of the environment and various other aspects. It would be quite difficult (to move the site offshore) without rational cause." (4) New source of trouble emerges for Iwakuni; Central government may have sounded out city on construction of U.S. military housing; City keeps its silence, ignoring citizens' right to know TOKYO SHIMBUN (Pages 20 & 21) (Abridged slightly) October 6, 2008 By Chiaki Ueda A new controversial issue has emerged for the city of Iwakuni in Yamaguchi Prefecture, which is being shaken by the realignment of U.S. forces in Japan. The existence of a document has come to light that shows the city had been informally asked by the central and prefectural governments about the construction of U.S. military housing at the Atagoyama area. The city, which has denied any approach by them, is holding its silence. Will the citizens' right to know be protected? City assemblyman Yoshihiro Watari said in a strong tone with a copy of the document in his hand: "The city said in June that there had been no approach by the central government or the prefectural government. The city told us a big lie." In September, like-minded city and prefectural assemblymen, including Watari, disclosed a copy of the document that have fallen into their hands following some news reports, saying that it was clear that there had been an informal request about the construction of U.S. military housing and that concealing it would put the citizens at a disadvantage. The document consists of the minutes of three sets of discussions: talks among city officials; talks with prefectural officials; and talks with prefectural and prefecture housing corporation officials. They all discussed the use of Atagoyama area. The document notes that it was produced by the Atagoyama area development office. The talks reportedly held at the mayor's office on April 7, 2008 were attended by Mayor Yoshihiko Fukuda, Deputy Mayor Kuniyasu Otomo, and senior officials of departments responsible for the Iwakuni base and Atagoyama. Their discussion centered on the fact that the prefectural and central governments had tried to confirm the mayor's intent. According to the minutes, the base division director first said: "There were calls from the prefectural government and the Defense Ministry urging us to confirm quickly the mayor's intent." The TOKYO 00002798 005 OF 012 minutes also include some statements on the city's request to the central government for the resumption of the civilian airport at the Iwakuni base. The division director said: "In order to resume the civilian airport, they pointed out the need to have (the mayor's) clear intent to endorse the construction of U.S. military housing." The mayor then asked: "The civilian airport, U.S. military housing, and Atagoyama. It is going to be a trade-off?" The division director replied, "Yes, it is going to be a trade-off." One asked, "Why does Iwakuni have to pay such a price for securing U.S. military housing?" Another city official noted: "I cannot bear to offer an explanation to the local residents." Still another commented: "In view of the sentiment of local residents, selling the area for U.S. military housing is difficult." Those comments alluded to the city's agony. The Atagoyama development project began in 1998. It was pushed forward in tandem with a plan to move the Iwakuni base runway 1 kilometer offshore with the aim of reducing noise at the base. The blueprint was to reclaim the planned new base area with earth and sand from Atagoyama and redevelop the Atagoyama area to build 1,500 housing units for 5,600 people on the 60-ha land. The prefectural government, prefectural housing corporation, and city government decided in June 2007 to halt the project, citing diminished demand due to a change in the economic situation. Planning to relocate a national hospital to and selling one-fourth of the land to the civilian sector, they have asked the central government to purchase the remaining three-fourths of the 60-ha land. The prefectural government is asking the central government to procure the site, saying the prefecture has cooperated on the government's project. The Defense Ministry, on the other hand, says that it is still at the stage of collecting information. Since the document was disclosed, the city has taken an odd stance. Although the city has admitted that there had been a meeting on the date specified in the document and the meeting had resulted in a memo, an Atagoyama area development office official said: "We do not know if the disclosed document was drafted by the city, so we cannot make any comment on it." The document, which specifies the names of attendants, the date, venue, and who said what at the meeting, does not look like a memo. Why does the city refuse to refer to the document so adamantly? Katsusuke Ihara, who served as Iwakuni mayor from 1999 until he was defeated by Fukuda in the February 2008 mayoral race, explained: "There is no other place but Atagoyama to build U.S. housing for 4,000 people. The central government indirectly asked the city as early as several years ago. It is natural to think that the city cut a secret deal behind the scenes. The city cannot admit that there was an informal request because such would make it a liar." Although the central and prefectural governments have denied any informal request to the city, chances are slim for them to sell the land to the civilian sector. Building U.S. military housing is the most likely scenario. The prefectural and city governments are 24.4 billion yen in dept because of the halted project. They are supposed to compensate for it 2 to 1. Without the construction of U.S. military housing, huge financial burdens would fall upon them. Ihara noted: "If there is no other way but to build U.S. military housing, the city should tell that to the citizens fairly and TOKYO 00002798 006 OF 012 squarely, discuss it, and obtain their understanding. Truth and the citizen's right to know are most important" What do citizens think of the matter? Kuruma-machi is only 1 kilometer away from the Iwakuni base's front gate. Sometimes, roaring noise from the base is heard all day at this area. Third Kuruma Residents Association Chairman Takashi Takabayashi, 68, said angrily: "If U.S. military housing were to be built after night landing practice, there are no merits in living in Iwakuni. Was the city trying to endorse such a plan secretly?" In April, the association presented the city with a petition saying: "Once (the U.S. military) begins NLP as a result of U.S. military realignment, noise pollution would worsen. Let them move us to Atagoyama, instead of building U.S. military housing there." The citizens have been toyed with by the central government and U.S. military. The government temporarily stopped paying subsidies for the construction of the city hall following the city's rejection of the U.S. military realignment plan. The situation has changed with the election of pro-base Mayor Fukuda. Takamitsu Hirokane, 70, ONE of the landowners of Atagoyama, said: "It was not easy to make a decision to sell the family land. They explained: 'The relocation of the runway will help reduce noise. We need your cooperation for securing safety and a peace of mind.' There was no reason to oppose it." Hirokane also raised his voice: "That will completely change (with the construction of U.S. military housing. I am not convinced with such a plan. The city, which has not disclosed what should be disclosed, is flinching from its responsibility." A 63-year-old man living near Atagoyama also said: "The area in front of one's house might be surrounded by a barbed-wire fence. People won't be able to stand such a scene mentally. Atagoyama is our hometown. We cannot sell it for the sake of the United States." (5) Interview with Eisuke Sakakibara, professor at Waseda University: Largest-scale postwar financial crisis still only at the second station (on the mountain) ASAHI (Page 12) (Full) October 7, 2008 -- Although legislation to bail out the U.S. financial system was passed by the Congress after much confusion, no prospects are in sight for the financial crisis to be contained. "With an eye on the upcoming election of the U.S. House of Representatives in November, the members were hesitant to use taxpayers' money to rescue Wall Street. I think the crisis will surely drag on and will not come to an end without injecting public funds into financial institutions, as Japan did in the past." -- The financial crisis originating in the U.S. but then spread to Europe. How do you view the spreading of the contagion? "What is now going on is the largest-scale postwar financial crisis. Furthermore, we are still only around the second station (on the mountain). Central banks across the world have pumped large volumes TOKYO 00002798 007 OF 012 of dollars into money markets to boost the dollar's liquidity and to prevent the global financial system from collapsing. In Japan and many other countries, banks will certainly become more reluctant to provide funds to smaller businesses. A global credit crunch will affect the real economy and trigger a global recession in industrialized countries. "The Case-Shiller home price index shows that futures markets will not bottom out before May in 2010 and will remain flat after that. In other words, the financial unrest will last for another two years or more. The impact of the crisis on the real economy is expected to appear afterward." -- It was just after a currency crisis hit Asia when you, as International Finance Bureau director general and vice minister of finance for international affairs, moved to correct the trend of strong yen against the dollar. What view do you have about the current depreciation of the dollar? "The dollar is certainly weak, but since the global economy is worsening, the situation is not such that only the dollar is declining. When Bear Stearns went bankrupt in March, the yen climbed to 95 yen to the dollar, and the euro was quoted at 1.6 dollars at one point. Since then, real economic conditions in Europe have become worse than conditions in the U.S., and the dollar against the euro has not fallen for over six months. The yen has not noticeably risen against the dollar, either. Exchange rates are determined relatively. In March, Japan, the U.S., and Europe mulled the possibility of cooperative intervention in exchange markets to support the dollar, but we are not in such a situation at present. "Western banks now find it difficult to procure dollars. This is a serious problem. Central banks' cooperative injections of funds into markets were a proper step. But even if the U.S. asks Japan to purchase nonperforming loans with public funds, Japan should absolutely not accept the request. "It is impossible for Japan to use taxpayers' money to bail out foreign banks that have branch offices in Japan. Japan should agree to take measures to normalize the functions of markets, but rescuing U.S. banks is what the U.S. should do. Japan must make this point clear." -- Is it conceivable that the current financial crisis will become the beginning of the end of the system of the dollar being a key currency? "It might be possible, when seen from the span of 20 to 30 years. In 5-to-6-year units, however, I do not think that the dollar-based system will significantly collapse. Rather, we should take the view that the beginning of the end of the American financial kingdom has set in. (6) Editorial: New JICA should give considerable thought to strategic ODA YOMIURI (Page 3) (Full) October 7, 2008 With the merger of the Japan International Cooperation Agency (JICA) and the Overseas Economic Cooperation Operations, a part of the Japan Bank for International Cooperation (JBIC),the new JICA has TOKYO 00002798 008 OF 012 been inaugurated. The expanded JICA's biggest challenge is to implement Japan's official development assistance (ODA) projects in a visible manner. The new JICA is an aid agency with over 1 trillion yen of available financial resources annually. Japan's ODA consists of three areas: 1) technical assistance to enhance human resources; 2) yen loan program to extend low-interest loans for improving such social infrastructure as roads and bridges, and 3) grants to provide assistance to non-governmental organizations and other bodies. In the past, JICA was in charge of technical assistance; JBIC was responsible for yen loans; and the Ministry of Foreign Affairs (MOFA) was charged with grant aid. This system was often criticized as ineffective due to the vertically fragmented system of administration. As part of the ODA reform, the new JICA has taken over MOFA's grant aid. Therefore, it now manages the three areas of grant aid, technical assistance and yen loans in an integrated fashion. Under the control of the Overseas Economic Cooperation Council, chaired by the prime minister, MOFA is in charge of making ODA policy and the expanded JICA implements ODA projects. This system will probably be welcomed by aid-recipient countries. Under the ONE roof, the new JICA has to implement effective aid programs. It will have to shorten the period of six to seven years it required to implement an aid project after receiving a request. For example, Japan provided Tunisia with yen loans to build an industrial park, as well as with technical aid to enhance human resources. This kind of aid project should be increased. The Japanese government has advocated the importance of aid to Africa. For Japan, which aims at a bid for a permanent seat on the United Nations Security Council, Africa is a powerful voting bloc and rich in natural resources. The new JICA needs to give considerable thought to enhancing assistance to Africa. However, although the three aid areas have come under the ONE roof, part of the technical assistance is controlled by the Ministry of Education, Culture, Sports, and Science and Technology, and the Ministry of Economy, Trade and Industry as in the past. It is also important to turn now to correcting the evils of bureaucratic sectionalism, as well. The expanded JICA will face an adverse wind. Because of the country's strained fiscal situation, Japan's ODA budget has been cut by as much as 40 PERCENT over the last ten years. Japan was once the largest aid donor in the world, but last year it dropped to fifth place. ODA is a major tool to strengthen Japan's diplomatic base. Japan must take advantage it in a strategic way in order to prevent its influence from weakening. To help the new JICA function, there is an urgent need to boost the ODA budget. (7) 160 North Korean defectors quietly entered Japan; Government does not recognize them officially ASAHI (Page 3) (Excerpts) TOKYO 00002798 009 OF 012 October 7, 2008 By Furuya, Shenyang There is an ongoing trend of North Korean defectors heading for Japan. People who have fled from North Korea are temporarily taken into Chinese custody and wait for their departure for Japan. But the Japanese government has been concealing such a fact out of deference to China. How is Japanese society going to address the question of North Korean defectors in the future? How is it going to accept defectors from North Korea? Without disclosing any information, discussions on the subject are bound to stall. 160 North Korean defectors have already entered Japan It is little known that almost every day a Japanese restaurant delivers box lunches to a two-story gray building behind the Japanese Consulate General in Shenyang, China. They are meals for people called "guests," whose existence is not recognized by the Japanese government. A person familiar with the matter said: "Although their stay stretches to several months, they are not allowed to cook. If they can have access to knifes, they might use them to commit suicide or fight among themselves. If they are allowed to use fire and a fire breaks out as a result, that would result in a liability issue. So there is no other option but to provide them with box lunches everyday." Accepted by the Japanese government are mostly those who had migrated to North Korea under the 1959-1984 mass "repatriation program." Many are secretly taken into Japanese custody when the rush into the Japanese embassy or consulates general after having secretly crossed the China-DPRK border, according to a Japanese government source. The number has increased since the late 1990s. Over 160 North Korean defectors have so far entered Japan. In May this year, a 73-year-old Japanese woman from Sendai and his son were taken into protective custody by Chinese authorities. Several Chinese brokers who had helped them flee from North Korea asked the Japanese government for 10,000 dollars in cash. The government did not comply with their demand. The government also was threatened that they would be repatriated to North Korea. North Korean authorities made two visits to the police facility in Jilin Province where the woman and his son were staying and demanded the handover of custody of the two. The Japanese Foreign Ministry did not make public this case. The Foreign Ministry is particularly attentive to the position on this of the Chinese government, which wants to handle the matter secretly. In consideration of relations with North Korea, China ostensibly upholds a stance that no refugee issue exists between the two countries and that it deports all North Korean defectors back to their country. But in reality, China, which wants to avoid drawing fire from the international community, has allowed North Korea defectors to leave the country based on "humanitarian considerations." Some cases have reportedly found their way into the media due to the slow procedures in China. Another Japanese government source said: "For settling North Korean defector cases, it is best that the media TOKYO 00002798 010 OF 012 do not write anything about them." Japan learned bitter lessons from an incident in May 2002 in which five North Koreans entered the Japanese Consulate General in Shenyang. The Japanese Foreign Ministry was harshly criticized along with China because the North Korean defectors had been taken into Chinese custody after entering the premises of the Japanese Consulate General. Since then, Japanese and Chinese authorities seem to have been in accord to send North Korean defectors to Japan without making a fuss. Life assistance left to supporters How are North Korean defectors treated at Japanese diplomatic missions in China? ONE concerned supporter said: "Defectors are not allowed to go out of the building they are in. They are allowed only to do some light indoor exercise, so some become nervous wrecks." Some were told by Japanese officials to feel grateful that steps were being taken to send them to Japan, according to another supporter. There is no move to establish a system for accepting North Korean defectors, partly because the process up to their arrival in Japan is kept secret. The North Korean Human Rights Law, enacted in 2006, urges the government to take steps to protect and support North Korean defectors. But in reality, the livelihoods of North Korean defectors in Japan are left to their supporters and families. Many children of the defectors who were born in North Korea cannot speak Japanese. In some cases, such children are stateless due to a lack of documentation. Finding employment and renting apartments are difficult for them. A North Korean defector, who is a grandchild of a Japanese wife, experienced extreme difficulty in establishing a family register in Japan due to a lack of the marriage license of the parents (who live in North Korea). There have been at least two known cases in which Japanese wives who had repatriated to Japan returned to North Korea. Many North Korean defectors have a misconception that once they get to Japan, they can enjoy comfortable lives. ONE Japanese supporter noted: "The government's attitude is that it helps those who want to go to Japan but does not assist them once they arrive in Japan. Such an attitude is irresponsible." Japan's acceptance of defectors from North Korea Accepted by the Japanese government are mostly Japanese nationals, ethnic Koreans, and their families who had migrated to North Korea under the 1959-1984 mass "repatriation program". Under this project, over 93,000 individuals went to North Korea. Included in them were Japanese spouses and 6,000 children. Of them, 1,831 were Japanese wives. Between 1997 and 2000, a total of 43 Japanese women returned to Japan for a week under home visit programs. Those who migrated to North Korea are not allowed to travel freely between the two countries. (8) TOP HEADLINES Asahi, Sankei & Tokyo Shimbun: New York stocks temporarily fall to 9,700 points TOKYO 00002798 011 OF 012 Mainichi, Yomiuri & Nikkei: New York stocks fall below 10,000 point level Akahata: UNIV Co-Po poll: Private college students living in apartment complex spent average of 2.14 million yen until entering dormitories (9) EDITORIALS Asahi: (1) Rice import obligation: Ruling, opposition parties should compete in ideas of strengthening agriculture (2) Government-affiliated financial institutions: How to produce effect by reforms Mainichi: (1) Extra Diet session: Lower House dissolution will create political vacuum (2) New JICA: Show integration effects to the world Yomiuri: (1) Lower House Budget Committee: Deepen argument on fiscal resources (2) New JICA: Give considerable thought to strategic ODA Nikkei: (1) Stock plunges -- warning to Japanese, U.S. governments and corporations (2) Supplementary budget should be quickly adopted Sankei: (1) Lower House Budget Committee: Policy debate urged (2) 44th birthday of Megumi Yokota: Prime Minister Aso should take tough stance against North Korea Tokyo Shimbun: (1) Stock plunges: Countries concerned must cooperate to overcome financial crisis (2) Battle against global warning: Japan should show its ideas to developing countries Akahata: (1) Withholding of medical insurance premiums: Prime minister must listen to indignant complaints (10) Prime Minister's schedule, October 6 NIKKEI (Page 2) (Full) October 7, 2008 07:54 Met Deputy Chief Cabinet Secretary Matsumoto at the Kantei. 08"26 Met HEALTH and Welfare Minister Masuzoe and Social Insurance Agency Director General Sakano. 09:00 Attended a Lower House Budget Committee meeting. 12:01 TOKYO 00002798 012 OF 012 Had a photo shoot with Nagasaki Prefectural Assembly Chairman Tokuaki Miyoshi. 12:04 Returned to the Kantei. 13:00 Attended the Lower House Budget Committee meeting. 17:05 Attended an LDP executive meeting. 17:28 Returned to the Kantei. 18:39 Dined with the Emperor and Empress at the Imperial Palace, along with wife Chikako. 21:36 Returned to his residence in Kamiyama. SCHIEFFER

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