TOKYO MEDIA REACTION - GLOBAL ECONOMY AND

UNCLAS SECTION 01 OF 02 TOKYO 002825 SIPDIS STATE FOR I/RF, PA/PR/FPC/W, IIP/G/EA, EAP/PD, R/MR, EAP/J, EAP/P, PM; USTR FOR PUBLIC AFFAIRS OFFICE; TREASURY FOR OASIA/IMI; SECDEF FOR OASD/PA; CP BUTLER OKINAWA FOR AREA FIELD OFFICE; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR E.O. 12958: N/A TAGS: OIIP KMDR KPAO JA SUBJECT: TOKYO MEDIA REACTION - GLOBAL ECONOMY AND NORTH KOREA ¶1. LEAD STORIES: Top stories on Friday morning included Japan's plan to propose at the G7 meeting on Friday an emergency IMF loan program for newly emerging economies and small- and medium-sized nations. ¶2. "New Thinking Needed for Unprecedented Crisis" The liberal Mainichi editorialized (10/10): "...The Emergency Economic Stabilization Act was enacted after the struggle. However, the move failed to remove the anxiety, and the turmoil in the international financial system is continuing. The current crisis appears to be approaching an unknown stage... It will be impossible to restore market confidence by measures based only on traditional thinking. Revolutionary approaches are called for. We need to move very quickly to cope with the nose-diving market. Although Secretary of the Treasury Paulson expressed a positive position toward possible injection of public funds into financial institutions, words are not enough and swift action is called for." ¶3. "Market Calling for Additional Steps" The moderate Yomiuri insisted in an editorial (10/10): "The market is calling for robust measures to prevent financial crisis. The U.S. government should quickly make a decision to inject public funds into financial institutions... Based on the past lessons of Japan, injecting public funds into financial institutions is necessary to reinforce their capital base in addition to the purchase of their troubled assets. The U.S. should follow through the UK decision to use public funds." ¶4. "U.S. Should Inject Public Funds" The conservative Sankei's editorial said (10/10): "...Secretary of the Treasury Paulson hinted during his press conference on Wednesday at the possibility of injecting public funds into troubled financial institutions. We hope the U.S. will swiftly create a specific framework to implement the idea. The financial crisis has spread to Europe. The UK has decided to use public funds. The market remains uncertain due to slow action on the part of the U.S." ¶5. "G7 to be Tested" The liberal Tokyo Shimbun editorialized (10/10): "...The UK has decided to inject public funds into financial institutions ahead of the G7 meeting on Friday. Japan solved its own problem in the 1990s by using public funds. The later the U.S. acts, the more serious the problem will be... G7 is not sufficient to cope with the worldwide financial crisis... Such nations as China, India, Brazil, and Russia should be involved in the discussion." ¶6. "Delisting of North Korea Unacceptable" The conservative Sankei editorialized (10/10): "The possibility has emerged that the U.S. might delist North Korea as a state sponsor of terrorism by overlooking a critical point of verification of Pyongyang's declaration of its nuclear programs. Japan should not accept it, as the move, which will not guarantee strict verification, violates the principle of complete abolishment of nuclear programs by North Korea... The biggest concern is that easy delisting could undermine the U.S.-Japan alliance. Ambassador Schieffer said on Thursday that President Bush has not made any decision yet. Prime Minister Aso should convey TOKYO 00002825 002 OF 002 Japan's position to the USG and urge Washington to make the right decision." SCHIEFFER