METI VM MOCHIZUKI ON ENERGY, ENVIRONMENT AND TRADE

C O N F I D E N T I A L SECTION 01 OF 02 TOKYO 002966

SIPDIS

STATE FOR OES, EEB, EAP/J AND AMBASSADOR HASLACH
USTR FOR AUSTR WCUTLER AND DAUSTR MBEEMAN
NSC FOR JLOI, JSHRIER, PBROWN
CEQ FOR JCONNAUGHTON, LVANDYKE

E.O. 12958: DECL: 10/21/2018
TAGS: EINV ENRG ETRD JA PREL SENV CH
SUBJECT: METI VM MOCHIZUKI ON ENERGY, ENVIRONMENT AND TRADE

TOKYO 00002966 001.2 OF 002


Classified By: Ambassador J. Thomas Schieffer for reasons 1.4 (b) and (
d).


1. (C) Summary: Ministry of Economy, Trade and Industry
(METI) Vice Minister Harufumi Mochizuki focused on energy,
climate change, the WTO, and China, in an October 22 meeting
with the DCM. Mochizuki noted a shared interest in an
effective and inclusive post-Kyoto framework, as well as
energy saving and environmental technologies. Specifically,
he asked the DCM to convey to Washington METI's desire for
U.S. support of a proposed November 16 meeting of G8 plus
energy ministers. Mochizuki said trade liberalization
deserved greater attention in the WTO and other fora,
particularly in relation to developing countries less able to
cope with a downturn in the global economy. Reflecting the
recent Japan-China economic dialogue, Mochizuki noted China's
evolving sense of responsibility and recognition of the
international implications of its actions and positions. End
summary.

Climate Change and Energy
--------------


2. (SBU) Mochizuki, who had previously been Vice Minister
responsible for METI's subsidiary Agency for Natural
Resources and Energy, opened the conversation with energy and
climate change. He noted the recent currency of these topics
and Japan's coordination with the U.S.


3. (SBU) Mochizuki stressed a post-Kyoto protocol outcome
should actively address climate change, include all of the
key players, including developing countries, and reflect
concerns about development and economic impact. We cannot
tolerate a weak compromise in a new framework, Mochizuki
said. The DCM added it is important also to encourage
continued development and wide adoption of environmentally
friendly and energy conserving technologies. Both sides
noted the U.S.-Japan cooperation in areas such as civilian
nuclear power and the importance of continuing and further
strengthening cooperation under a new U.S. administration.


4. (SBU) Mochizuki urged the U.S. to participate in and
support the proposed G8 plus Energy Forum. The Forum is
planned for November 16, and METI wants to see it succeed,
but MOFA has not yet sent invitations. Mochizuki asked the
DCM to convey the GOJ's interest to Washington. The DCM
agreed, but did not comment further.

WTO
---


5. (SBU) Mochizuki said the potential failure to conclude the
Doha Development Round this year could have serious
implications, compounded by the current economic situation,
particularly in developing countries. He specifically
expressed concern about Africa, where countries have very
little cushion for dealing with economic shocks. The DCM
noted the current financial turmoil may increase economies'
sense of urgency and provide stronger motivation to further
liberalization. He also congratulated METI on its advocacy
and role in hosting recent talks on the Anti-Counterfeiting
Trade Agreement.

APEC
--------------


6. (SBU) The DCM said the U.S. and Japan should closely
coordinate on a forward-looking agenda during their
consecutive years as chairs of the Asia Pacific Economic
Cooperation (APEC) forum (Japan in 2010; U.S. in 2011).
Noting APEC is the premier trade organization in this part of
the world to engage on trade and investment, the DCM said the
U.S. will remain focused on Asia under any new
administration. In particular, APEC economies must play a
critical role in addressing current economic concerns. Both
presidential candidates Obama and McCain have extensive

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experience and interest in the region, which bodes well for
future U.S.-Asia engagement, he said. The Vice Minister
noted the upcoming visit of Ambassador Haslach, and said METI
is interested in both APEC coordination and the U.S.-Japan
Investment Initiative. The DCM said there are still
important constituencies in both the U.S. and Japan that can
benefit from outreach on foreign investment.

Japan-China Dialogue
--------------


7. (C) Providing a readout of the recent Japan-China economic
dialogue, now in its 27th year, Mochizuki said the current
recessionary downturn is worrisome. A lapse in economic
growth could lead to a range of domestic problems for China.
Mochizuki noted Chinese approaches and positions have evolved
significantly from the past. China has a better
understanding of its responsibilities in the global economy
and wants, for example, to avoid causing further distress to
financial markets by unexpected or sudden large transfers of
Chinese funds. The DCM agreed China's international
engagement on economic issues has progressed, but said
U.S.-Japan coordination is important to address shared
concerns such as intellectual property rights enforcement.
Mochizuki concurred, adding that concerns about prospective
Chinese IT security rules is another area in which the U.S.
and Japan should work closely together.

Boeing - Airbus
--------------


8. (C) The DCM raised concerns over apparent EU attempts to
exert political pressure to influence the upcoming ANA
procurement and reports that ANA may be under pressure for
non-business reasons to buy from Airbus rather then Boeing.
Mochizuki agreed major procurement decisions should be left
to markets and not subject to political influences, although
METI would not be involved in the aviation sector in any
event. He agreed to look into the issue.

Comment
--------------


9. (C) Mochizuki was most comfortable and animated on energy
and climate change issues, reflecting his previous brief. He
also showed particular interest in the WTO and China, and
seemed to have a good sense of priority and proportion. He
was generally positive about U.S.-Japan coordination and
expressed a desire to maintain an open channel to quickly and
smoothly address problems should they arise.
SCHIEFFER