JAPANESE MORNING PRESS HIGHLIGHTS 02/28/08

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E.O. 12958: N/A TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 02/28/08 Index: 1) Top headlines 2) Editorials 3) Prime Minister's daily schedule (Nikkei) Visit of Secretary Rice: 4) Secretary Rice, Prime Minister Fukuda see need to strengthen alliance in wake of schoolgirl rape incident (Tokyo Shimbun) 5) Secretary Rice offers apology for Marine rape incident (Mainichi) 6) Rice stresses resolve to prevent recurrence of incidents like the Okinawa rape (Nikkei) 7) Rice confirms with Prime Minister Fukuda importance of preventive measures to halt U.S. military misconduct (Yomiuri) 8) - Issue of SOFA revision put to rest by Rice visit, but Okinawa sentiments still strong for changing the pact (Mainichi) 9) Rice stresses cooperation among Japan, U.S., ROK to deal with North Korean issue (Asahi) 10) Rice: No deadline set for DPRK to declare nuclear programs (Nikkei) 11) Rice urges North Korea again to completely declare its nuclear programs (Mainichi) 12) Japan, Israel issue joint statement at summit meeting giving priority to peace process (Yomiuri) Defense issues: 13) USFJ releases report on off-base housing that shows more than half or the 21,885 residents in 15 prefectures are in Okinawa (Mainichi) 14) Permanent PKO dispatch law put on hold due to Aegis collision incident (Yomiuri) 15) Vice defense minister apologizes for failure to inform JCG about questioning of navigating officer (Asahi) Political issues: 16) Ishiba's conduct in questioning captain without informing Coast Guard another blow for the Fukuda administration (Mainichi) 17) Fight over budget adoption in the Diet further sidetracked by the Aegis row (Nikkei) 18) Bank of Japan appointment also bumped back by the Aegis incident (Asahi) 19) Democratic Party of Japan again pushing for someone other than Muto for BOJ governor (Asahi) 20) Democratic Party of Japan to present counterproposal to the government's road funding bill that uses gasoline taxes (Nikkei) 21) Fukuda to host 16 nation summit on global warming to coincide with the Lake Toya G-8 Summit in July (Asahi) 22) Restrictions on foreign investment in airports will be approved by the cabinet next week but in a scaled-down version (Mainichi) Articles: 1) TOP HEADLINES Asahi, Mainichi, Yomiuri, Sankei, & Tokyo Shimbun: Defense Ministry questions navigator of Atago without approval from Japan Coast Guard; Calls growing in ruling camp for Ishiba's resignation TOKYO 00000522 002 OF 015 Nikkei: Government shelves plan to limit foreign stakes in airport operators for now Akahata: Rally calling for revision of Worker Dispatch Law held in Diet Building 2) EDITORIALS Asahi: (1) Prince Hotel should have had courage to counter right-wing group's outrageous acts toward Japan Teachers' Union (2) Take initiative in forming international emissions-trading system Mainichi: (1) Bush administration should express resolve to denuclearize North Korea during term of office (2) Focus on Improving pension system, special accounts in discussion on establishing Japanese-version SWF Yomiuri: (1) Rice's Japan visit as part of steady efforts to maintain Japan-U.S. alliance (2) Contain financial resources by revising Anti-Gangster Law Nikkei: (1) Government must present new prescriptions for structural reform in report due out in June (2) Burmese military junta's dictatorship unacceptable Sankei: (1) What Defense Minister Ishiba should address now is ministry reform, reflecting on Aegis collision incident (2) Rice's visit to Japan: It's time to reconstruct alliance among Japan, U.S., and South Korea Tokyo Shimbun: (1) Labor unions' abilities tested over rectifying income disparities in spring wage struggle (2) Cuban Castro's retirement should be made chance for easing tensions Akahata: (1) Stop maneuverings to change the nature of treaty to ban on use of cluster munitions 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, February 27 NIKKEI (Page 2) (Full) February 28, 2008 08:47 Met with Health and Labor Minister Masuzoe and State Minister in Charge of Declining Birth Rate Kamikawa at Kantei. 09:37 Met with Chief Cabinet Secretary Machimura, Deputy Chief Cabinet Secretary Futahashi, and Deputy Assistant Chief Cabinet Secretary SIPDIS TOKYO 00000522 003 OF 015 Saka. 10:17 Met with METI Vice Minister Kitabatake, METI Economic and Industrial Policy Bureau Director-General Suzuki, METI Manufacturing Industries Bureau Director-General Hosono, and METI Trade and Economic Cooperation Bureau Director-General Adachi. Afterwards, met with Administrative Vice Agriculture Minister Shirasu. 11:06 Met with Ambassador to Israel Katori and MOFA Middle Eastern and African Affairs Bureau Director-General Okuda. Afterwards, met with Futahashi. 12:30 Attended a session of the Consumer Administration Promotion Council. 14:58 Met with Futahashi. 15:52 Met with House of Representatives member Yasufumi Tanahashi. 16:25 Met with U.S. Secretary of State Condoleezza Rice. 17:36 Met with House of Representatives members Taku Yamasaki and Koichi Kato. 18:02 Met with Israeli Prime Minister Olmert. Afterwards, held a joint press conference and hosted, together his wife, a dinner party for him. 20:49 Arrived at residential quarters in Kantei. 4) Secretary of State Rice meets with Prime Minister Fukuda: Both expresses sense of crisis over rape of school girl by U.S. Marine, emphasizes need to strengthen alliance TOKYO SHIMBUN (Page 2) (Full) February 28, 2008 Yuji Nishikawa U.S. Secretary of State Condoleezza Rice yesterday met separately with Prime Minister Yasuo Fukuda, Foreign Minister Masahiko Komura, and other Japanese leaders. In those dialogues, both Japan and the United States repeatedly emphasized the need to strengthen the bilateral alliance. Standing in the way of the two governments' efforts to do so is a spate of misconducts by U.S. service members, including the recent alleged rape of a junior high school girl by a U.S. Marine in Okinawa. In order to prevent any harmful effect on the bilateral alliance, the Japanese and U.S. governments highlighted their determination to take measures to prevent a recurrence of similar incidents, revealing their sense of crisis over the situation. At the outset of these meetings, Rice expressed regrets over the TOKYO 00000522 004 OF 015 incident and stressed her intention to make all she can to prevent a recurrence, noting, "We never hope to see such an incident occur. In order to prevent a recurrence of similar incidents, I'd like to cooperate with the Japanese government." In response, the Japanese side expressed concern about a possible impact on the Japan-U.S. alliance with Defense Minister Shigeru Ishiba saying, "It was an unfortunate incident for the alliance." Japan resumed the Maritime Self-Defense Force's (MSDF) refueling mission in the Indian Ocean, which had been suspended in last November and had been pending for the Japanese and U.S. governments since then just until recently, on Feb. 21 after a hiatus of four months. In last December, the MSDF succeeded in its missile defense (MD) intercept test conducted in waters off Hawaii. The bilateral alliance was thus in a good shape, but it is now being rocked by a spate of misconducts committed by U.S. service members. On Feb. 22, the Japanese government released a set of measures to prevent a recurrence of similar incidents, such as receiving a report on the number of U.S. military personnel living off-base once a year from the U.S. side. The Ministry of Defense (MOD),as if to be aware of Rice's visit to Japan, yesterday publicized the numbers of U.S. service members (who live off-base) in cities, towns, and villages respectively across the country. However, doubts are already raised about the effectiveness of those preventive measures. Okinawa Prefecture calls for a drastic review of the U.S.-Japan Status of Forces Agreement (SOFA) in order to specify that suspects detained by the U.S. side should be hand over to Japan before indictment. The Japanese government, however, is negative about reviewing SOFA because it does not want to touch on cumbersome issues for the alliance. The Japanese government intends to simply improve the operation of SOFA. In fact, in the meeting yesterday with Rice, Koumura said, "We aim to take effective, comprehensive and continuous measures to prevent a recurrence of similar incidents in order to minimize the impact of the incident on the Japan-U.S. alliance." Both leaders did not discuss SOFA. 5) Rice offers apologies for U.S. serviceman's incident MAINICHI (Page 3) (Full) February 28, 2008 Prime Minister Yasuo Fukuda yesterday met at his office with U.S. Secretary of State Rice. In the meeting, Rice offered her apologies SIPDIS for an Okinawa-based U.S. Marine's alleged rape of a junior high school girl and other recent incidents involving American servicemen in Japan. "It's extremely regrettable and we're sorry," Rice said, "and we take these incidents seriously." She added, "We want to make our utmost efforts to prevent similar incidents." Fukuda responded by saying he would like to convey her words to the Japanese people. "We would like to work together between Japan and the United States to prevent a recurrence," Fukuda told Rice. After the meeting, Fukuda told reporters, "We agreed to make steadfast efforts so that there will never be this sort of incident again." With this, Fukuda underscored the need for Japan and the United States to cooperate in building a system to prevent such incidents from recurring. TOKYO 00000522 005 OF 015 Rice then met with Foreign Minister Masahiko Koumura, during which the two confirmed a course of action to continue efforts for "effective and comprehensive" measures in order to prevent similar incidents. Meanwhile, Japan has now resumed the Maritime Self-Defense Force's refueling activities in the Indian Ocean. "Japan will aim to be a peaceful cooperative nation," Koumura told Rice. He also said the Japanese government would consider establishing a permanent law allowing Japan to send the Self-Defense Forces for overseas missions. In connection with North Korea's nuclear programs, Koumura referred to the issue of delisting North Korea as a terror sponsor and explained that Japan's position is to see progress in the pending issue of Japanese nationals abducted to North Korea before that. Rice answered, "We will fully consult with Japan." 6) Rice stresses resolve to put efforts into preventing similar cases to U.S. Marine raping schoolgirl in Okinawa NIKKEI (Page 2) (Full) February 28, 2008 Visiting U.S. Secretary of State Condoleezza Rice met Prime Minister Yasuo Fukuda, Foreign Minister Masahiko Koumura, and Defense Minister Shigeru Ishiba in succession yesterday. Rice and Fukuda agreed on the need for Japan, the U.S., and South Korea to cooperate in persuading North Korea to resolve the issue of is past abductions of Japanese nationals and to scrap its nuclear development program. On the recent rape of a schoolgirl by a U.S. Marine in Okinawa, Rice expressed her sincere regret and promised to make utmost efforts to prevent similar incidents. Fukuda and Rice also promised to cooperate in forming a new international framework to fight global warming beyond the 2012 timeframe set under the Kyoto Protocol. Rice said: "In tackling the issue of climate change, it is necessary to also take economic growth into consideration." Secretary Rice and Foreign Minister Koumura shared the importance of SIPDIS strengthening cooperation among Japan, the U.S., and Australia, as well as with the North Atlantic Treaty Organization (NATO). In a joint press conference, Koumura stated: "We agreed on the view that it is necessary for Japan, the U.S., and South Korea to strengthen cooperation in dealing with common challenges, including issues related to North Korea." In reference to the issue of dropping North Korea from a U.S. terrorism blacklist, Koumura said: "She told me that the U.S. will fully discuss the issue with Japan." Regarding the abduction issue, Rice emphasized: "The U.S. would like to continue to support bilateral talks between Japan and North Korea." 7) Rice apologizes for string of irregularities involving U.S. service members, confirms with prime minister to take preventive measures YOMIURI (Page 2) (Full) February 28, 2008 Prime Minister Yasuo Fukuda held a meeting with U.S. Secretary of State Condoleezza Rice at his office yesterday. In the session, Secretary Rice apologized for a series of misconducts involving U.S. SIPDIS service members in Okinawa, including the recent alleged sexual TOKYO 00000522 006 OF 015 assault against a junior high school girl by a U.S. Marine, saying, "We feel deeply sorry and take them seriously." Secretary Rice also said that "the United States would like to work SIPDIS closely with Japan" in taking measures to prevent such incidents from occurring. The two leaders confirmed that the two countries would make utmost efforts to take preventive measures, with Prime Minister Fukuda saying, "It is a matter that must be taken seriously." Further, regarding climate change, a central topic in the G8 Lake Toya Summit in July, the prime minister said: "Combating global warming is imperative. We would like to work closely with the United States with the G8 Summit in mind." In response, Secretary Rice said, "In addressing climate change, it is important to keep a balance with economic growth." She thus indicated that the United States would carefully deal with accepting a quota for reducing greenhouse gas emissions. Secretary Rice also held talks in succession with Chief Cabinet SIPDIS Secretary Machimura, Foreign Minister Koumura, and Defense Minister SIPDIS Ishiba. In her talks with Koumura, the secretary welcomed Japan's resumption of the refueling operation in the Indian Ocean under the current Antiterrorism Special Measures Law. In response, Foreign Minister Koumura told her about the government's plan to study a permanent law specifying conditions for the overseas dispatch of the Self-Defense Forces. As for North Korea's nuclear programs, they also confirmed the policy course for Japan, the United States and South Korea to strengthen trilateral cooperative ties. They further agreed to continue to work together on pressing North Korea to present a complete and correct declaration of its nuclear programs. In her meeting with Defense Minister Ishiba, Secretary Rice, based on the establishment of the new South Korean administration led by President Lee Myung Bak, said: "Japan and South Korea are U.S. allies. We would like to strengthen those alliances in dealing with not only the denuclearization of North Korea but also with overall security in this region." 8) Visit of Secretary Rice puts seal on government talk about revising the SOFA over the Okinawa rape incident, but prefectural distrust likely to grow MAINICHI (Page 5) (Excerpt) February 28, 2008 In connection with the rape of a schoolgirl in Okinawa, the Japanese and U.S. governments through a series of meetings, including that between Prime Minister Fukuda and Secretary of State Rice, have confirmed that they will cooperate to prevent a recurrence of similar incidents. Although the government's measures to stop recurrences has been appreciated in Okinawa Prefecture as a rapid response, the gap between public opinion in Okinawa and the government over revising the Status of Forces Agreement (SOFA), which the government will not do, remains as wide as ever. The effectiveness of the preventive measures has only led to even greater distrust in the prefecture. 9) U.S. Secretary of State Rice: Cooperation among Japan, U.S., ROK necessary to deal with North Korea issue; Offers apology for rape incident TOKYO 00000522 007 OF 015 ASAHI (Page 4) (Full) February 28, 2008 Visiting U.S. Secretary of State Condoleezza Rice met yesterday with Prime Minister Yasuo Fukuda and Foreign Minister Masahiko Koumura separately. She offered an apology for the alleged rape of an Okinawan schoolgirl by a U.S. Marine. In the meetings, agreement was reached that Japan and the United States would cooperate to prevent a recurrence of similar incidents. In an interview to the Asahi Shimbun held prior to the meeting with Fukuda and Koumura, Secretary Rice said that the U.S. administration would place priority especially on cooperation between the U.S., Japan and South Korea in dealing with North Korean issues, following the inauguration of South Korean President Lee Myung Bak, who has stressed the importance of cooperation with the United States and Japan. The cooperation includes the resumption of foreign ministerial meetings among the three countries. In the interview, Secretary Rice expressed sincere regret over the U.S. Marine's rape incident. She said: "The incident was extremely regrettable. American people and the U.S. government are concerned about the girl and her family." Prime Minister Fukuda told her: "I would like to see cooperation between Japan and the United States to prevent a recurrence." Referring in the interview to how to strengthen cooperation between the U.S., Japan and South Korea, Secretary Rice stated: "It is only natural for the United States to cooperation with Japan and South Korea because we are allies." She underscored a stance of strengthening cooperation more with the new South Korea government than the previous Roh Moo Hyun government, which distanced itself from the United States and Japan. She also said: "The United States, Japan and South Korea once held foreign ministerial meetings. The three countries will probably continue them from now on." She indicated a resumption of meetings of the Trilateral Cooperation and Oversight Group (TCOG),which have been suspended since 2003. Prime Minister Fukuda pointed out: "Cooperation between Japan, the United States, and South Korea is also important." 10) Rice indicates no intent to set deadline for North Korea to declare nuclear programs NIKKEI (Page 2) (Full) February 28, 2008 In a press conference at the U.S. ambassador's official residence yesterday, U.S. Secretary of State Condoleezza Rice said that the U.S. would not set any new deadline for North Korea to declare its all nuclear programs. The deadline had been set for late last year, but Rice said: "The delay is not a problem." She indicated that the U.S. will continue to call on Pyongyang to fully explain its nuclear development programs using plutonium and highly enriched uranium, as well as its nuclear nonproliferation measures involving nuclear technology and materials, without setting a deadline. 11) Rice urges N. Korea again for "complete declaration" of nuclear programs MAINICHI (Page 3) (Abridged) February 28, 2008 TOKYO 00000522 008 OF 015 Visiting U.S. Secretary of State Rice met Japanese and foreign reporters at the U.S. ambassador's official residence in Tokyo yesterday afternoon. On the issue of North Korea's nuclear programs, Rice said she has left Assistant Secretary of State Hill in Beijing to "move the six-party talks forward." In the press interview, Rice suggested the need for North Korea to declare its nuclear programs in order to "make the next step productive." With this, she urged North Korea to submit a complete declaration of its nuclear programs in order to build a relationship of mutual trust. She indicated that North Korea's declaration of its nuclear programs should include its storage of plutonium and other nuclear materials, highly enriched uranium (HEU) program, and nuclear technology and material proliferation. Rice indicated that the issue of Japanese nationals abducted to North Korea is an issue relating to human rights. She also indicated that North Korea will have to implement its second-stage action, including declaring its nuclear programs, in order for the United States to delist North Korea as a terror sponsor. 12) Fukuda, Olmert issue joint statement committing to cooperation toward Middle East peace YOMIURI (Page 2) (Full) February 28, 2008 Prime Minister Fukuda met with visiting Israeli Prime Minister Olmert at the Prime Minister's Office yesterday. The two leaders later issued a joint statement in which Japan committed to contributing to resolving the Israeli-Palestinian conflict and moving the Middle East peace process forward. This is the first Israeli prime ministerial visit to Japan in 11 years. The two countries exchanged political documents for the first time. The statement notes: (1) Japan, Israel, Jordan, and the Palestinian autonomous government should cooperate in turning into a concrete arrangement the "Corridor for Peace and prosperity" initiative, a project Japan has proposed to develop the Jordan Valley; and (2) Japan and Israel should establish a taskforce to strengthen their economic relations. The statement emphasizes a willingness to activate exchanges in the political, economic, and science / technology areas. In the meeting, Olmert expressed his concern about Iran's nuclear development and North Korea's moves for nuclear proliferation in the Middle East region. In response, Fukuda pointed out the importance of nuclear nonproliferation, while adding: "North Korea's nuclear problem is an imminent challenge. Resolving the abduction issue is also essential for our nation. We are stepping up efforts to improve relations with North Korea, but progress has not been made as we expected." Prior to meeting with Fukuda, Olmert met Foreign Minister Koumura at a Tokyo hotel. Koumura voiced apprehension about the construction by Israel of houses in East Jerusalem for immigrants, saying: "The move is aggravating the conflict." 13) U.S. military's off-base population totals 21,885; Nearly half live in Okinawa MAINICHI (Page 3) (Abridged) TOKYO 00000522 009 OF 015 February 28, 2008 In the wake of an Okinawa-based U.S. Marine's alleged rape of a local junior high school girl, the Defense Ministry yesterday announced the number of U.S. military personnel living outside their bases in Japan, as well as civilian employees and family members, as part of its measures to prevent similar incidents. They total 21,885 in 15 prefectures, including Tokyo and Hokkaido. In Okinawa Prefecture, the U.S. military's off-base population is 10,319-nearly half of the total number. Including on-base population, the U.S. military's total population in Japan is 92,491. The U.S. military's off-base population in Japan accounts for a little over 20 PERCENT of its total population in Japan. U.S. Forces Japan provided the Japanese government with data as of the end of March, 2007. In the breakdown of municipalities, Kanagawa Prefecture's Yokosuka City has the largest number of off-base U.S. military residents at 3,420, followed by Okinawa Prefecture's Chatan Town at 2,893, Okinawa City at 2,705, Nagasaki Prefecture's Sasebo City at 2,008, and Aomori Prefecture's Misawa City at 1,550. 14) SDF legislation project team put off YOMIURI (Page 4) (Abridged) February 28, 2008 The ruling coalition of the Liberal Democratic Party and New Komeito has now decided to postpone its plan to set up a project team intended to study overseas missions for the Self-Defense Forces. The project team was initially set to launch yesterday. New Komeito became cautious about the plan, following the recent fatal collision of a Maritime Self-Defense Force Aegis destroyer with a fishing boat that has left the fishing boat's two crewmen missing. "We will have to discuss a general (permanent) law for the Self-Defense Forces' overseas missions," New Komeito Secretary General Kitagawa told reporters yesterday. "But," Kitagawa added, "we're not in such an environment to do so for now" given the public's growing criticism of the government over the Aegis accident. The idea of establishing a permanent law for the SDF's overseas missions is intended to prepare for a newly enacted antiterrorism special measures law's expiry in January next year. The ruling coalition is planning to present a bill to the Diet during its current session. The LDP held a joint meeting of its panels on Feb. 13 to enter into discussions on the permanent legislation for the SDF's overseas activities, with former LDP Vice President Taku Yamasaki presiding. New Komeito has also held hearings with opinion leaders since this January. The party was expected to set about a full-fledged study of the permanent legislation with the ruling coalition's project team. The Aegis accident seems to have dampened that momentum. 15) Vice defense minister apologizes for failure to inform JCG about questioning of navigating officer ASAHI (Top play) (Excerpts) February 28, 2008 Administrative Vice Defense Minister Kohei Masuda late yesterday TOKYO 00000522 010 OF 015 held a special news conference in order to give an account of the Maritime Staff Office's (MSO) questioning of the navigating officer of the Aegis destroyer Atago on the day of the collision with the fishing boat Seitoku-maru. The navigating officer was told by the MSO to come to the MSO by helicopter for questioning. Masuda admitted that the way the MSO informed the Japan Coast Guard (JCG) of the questioning was "inappropriate." Although Masuda still insisted that the MSO contacted the JCG before noon, the JCG denied there was such contact, so Masuda told the press: "I was unable to confirm our side contacted the JCG." Masuda in effect confirmed Defense Minister Ishiba's reply made in Diet deliberations yesterday morning, in which Ishiba said that "it was not necessarily appropriate" to have the questioning without approval from the JCG. According to Masuda's explanation, on the morning of Feb. 19, when the collision took place, the chief of the Fourth Chief of Staff Office of the Yokosuka District Headquarters told the Yokosuka Coast Guard Department by phone: "We will have one senior officer disembark before entering the port in order to have him transport an injured person and report to our unit." But Masuda added that "Because I don't have a clear memory of whom our side telephoned, I can't confirm" whether these matters were well relayed to the Yokosuka Coast Guard Department." 16) Prime Minister Fukuda, protective of defense minister under fire, also feeling the adverse effect; Budget bill, selection of new BOJ governor may be affected MAINICHI (Page 2) (Full) February 28, 2008 Katsumi Kawakami Defense Minister Shigeru Ishiba now finds himself in an even tighter spot since he has admitted that it was "inappropriate" for him to question, without obtaining approval from the Japan Coast Guard (JCG),the navigating officer of the Maritime Self-Defense Force's (MSDF) Aegis destroyer Atago over the collision of the Atago and a fishing boat. With the opposition parties gearing up to grill the government over its handling of the collision, the backlash from the accident could affect struggles in the Diet between the ruling and opposition blocs over the passage of the 2008 budget bill, as well as the selection of a successor to the incumbent Bank of Japan (BOJ) governor, whose term of office is to expire shortly. Prime Minister Yasuo Fukuda, who has been defending Ishiba, has put himself into the line of critical fire, as well. A senior member of the ruling Liberal Democratic Party (LDP) Upper House Caucus said yesterday, "With the two fishermen still missing after the collision, Mr. Ishiba naturally needs to take responsibility for that. However, the first thing for him to do is to pave the way for a full accounting of the facts about the collision." This lawmaker indicated that Ishiba's resignation is unavoidable, once he certain light is thrown on the cause of the accident. Fukuda yesterday evening told reporters at the Prime Minister's Official Residence: "It is only natural for the minister in charge to investigate the incident on his own in order to shed light on what happened. I think what he did was within his responsibility." Fukuda defended Ishiba for questioning the Atago's navigator about the collision. But Fukuda added: "It would have been good if he had TOKYO 00000522 011 OF 015 paid more careful attention and contacted the Japan Coast Guard." 17) Battle over budget bill between ruling, opposition camps NIKKEI (Page 2) (Full) February 28, 2008 The ruling and opposition parties are conducting fierce discussions as to setting a date for passing the fiscal 2008 budget bill through the House of Representatives. Although the ruling camp aims to get the bill passed on Feb. 29 by the Lower House, the opposition parties are putting up do-or-die resistance against the plan, seeking thorough deliberations on the collision of a Maritime Self-Defense Force destroyer and a fishing boat. The government and ruling coalition are engaging in complicated maneuvering because of their desire to avoid a damaging standoff with the main opposition Democratic Party of Japan (DPJ or Minshuto) in order to secure the DPJ's approval of their appointment of a new governor of the Bank of Japan. Ruling Liberal Democratic Party (LDP) Diet Affairs Committee Chairman Tadamori Oshima and his DPJ counterpart Kenji Yamaoka yesterday discussed the issue of setting a date for taking a vote on the budget bill in the House of Representatives. Yamaoka: "How about putting off your plan to next week?" Oshima: "We absolutely cannot give up on our plan of adopting the budget bill this week." Oshima insisted that the bill pass the Lower House this week, and the meeting ended in rupture. The ruling camp plans to hold concentrated deliberations on the collision between the Aegis ship and fishing boat on Feb. 29 and to pass the budget bill and a bill amending the Special Taxation Measures Law, which includes measures to retain the current provisional tax rates for road construction, through the Lower House on the same day. The budget bill is sent to the House of Councillors after the Lower House adopts it. The bill will be enacted automatically if the Upper House does not take a vote within 30 day s after it receives it. The ruling coalition is seriously concerned about being forced to compile a temporary budget (i.e., continuing resolution). Referring to the state budget and the Special Taxation Measures Law revision bill in a consultation yesterday between the government and ruling parties, LDP Secretary General Bunmei Ibuki pointed out that passing the bills before the end of the current fiscal year is a precondition for an agreement between the ruling and opposition camps reached thorough the good offices of the Lower House speaker and Upper House president that a certain conclusion should be reached. He said: "The Lower House speaker should express his own view." Some in the ruling camp think that a vote on the bill revising the tax law should be taken next week or later, separately from the budget bill. Their aim is to show a certain level of consideration to the opposition in order to prevent deliberations on the budget in the Upper House from stalling. A senor ruling coalition member said: "Whether the ruling and opposition camps can reach agreement is still a fifty-fifty chance." TOKYO 00000522 012 OF 015 18) Ruling bloc's presentation of candidate for new BOJ governor to be delayed ASAHI (Page 4) (Excerpts) February 28, 2008 The government has yet to present its Bank of Japan personnel plan. Although the ruling coalition has followed procedures with the aim of presenting a plan on key positions requiring Diet approval by mid-February, Prime Minister Yasuo Fukuda has now made a decision to postpone the presentation until next week. The ruling camp's careful attention to moves by the major opposition Democratic Party of Japan (DPJ or Minshuto) has been distracted by the fierce battle with the opposition camp over Lower House approval for the budget bill and the unexpected recent collision between an Aegis destroyer and a small fishing boat. A delay in the government's presentation of a "shoo-in" has rekindled the argument in the DPJ to find another candidate. The ruling bloc has aimed at setting the stage so that is easy for the DPJ to give its consent to the ruling bloc's list of new key BOJ officials. The confrontation between the ruling and opposition bloc affecting personnel affairs is something that is not envisaged even under the Constitution, according to LDP Secretary General Bunmei Ibuki. In order to avoid the Upper House's rejection of a hastily crafted plan, Ibuki has repeatedly advised the prime minister to wait for a while to present a plan. To secure sufficient time for setting the stage, the ruling coalition set the deadline at late February, later than the government's plan of mid-February. During that period, talks were held centering on LDP Diet Affairs Committee Chairman Tadamori Oshima and his DPJ counterpart Kenji Yamaoka, and an agreement was reached on new rules as a result of accepting the opposition camp's plan as is. The ruling bloc was hoping that the DPJ would later on endorse its plan to promote Deputy Governor Toshiro Muto, the government's favorite candidate. On Feb. 21, Ibuki and Oshima sounded Yamaoka out on Muto's promotion behind the scenes. But Yamaoka said: "Many DPJ members are opposed to Mr. Muto's promotion." This has spread the pessimistic view in the LDP that President Ozawa would not be able to unite the party on the matter of Muto's promotion. As if to add insult to injury, an Aegis destroyer collided with a small fishing boat on Feb. 19. The incident was followed by the opposition bloc's call for Defense Minister Ishiba's resignation and intensive Diet deliberations to uncover the truth. This has led to an intensified battle with the ruling bloc, which aims at Lower House approval before the end of February of the fiscal 2008 budget bill and budget-related bills. Tensions have heightened between the two camps this week over the presentation of BOJ executive candidates. 19) Argument calling for person other than Muto reignited ASAHI (Page 4) (Abridged slightly) February 28, 2008 TOKYO 00000522 013 OF 015 About the prime minister's decision to delay the presentation of a candidate for the Bank of Japan governorship, a member of the major opposition Democratic Party of Japan said: "The prime minister might be searching for someone other than Mr. Muto." There has been the hopeful observation in the DPJ that the prime minister will make a decision to recommend a person other than Mr. Muto. That observation is gaining ground in the party. The group determined to oppose Muto's promotion has also gained momentum. A member of the Diet Affairs Committee, which makes a final decision on the party's response, categorically said: "If Mr. Muto is (the government's decision),we will put up do-or-die resistance to the decision." If the government comes up with a plan to promote Muto in the knowledge that it will face the DPJ's fierce resistance, chances are that the BOJ governorship will temporarily remain unfilled. The DPJ envisions that the government will be held responsible for such an eventuality. Some in the government and ruling coalition have also begun calling for someone other than Muto. Following the ruling bloc's decision to leave the matter to the prime minister, a government source said, "I wonder if promoting Mr. Muto is the best way." Former LDP Secretary General Hidenao Nakagawa, too, noted in a speech: "I do not think the prime minister will insist on promoting someone the DPJ has rejected." There are flexible views in the ruling camp as well. Even if the ruling bloc recommends Muto under such circumstances, the DPJ, regardless of its response, will not able to escape undamaged. For this reason, an opinion has emerged in the DPJ to hold behind-the-scenes talks with the prime minister to prevent the ruling bloc from presenting a plan to promote Muto. 20) DPJ to present own bill on road funds NIKKEI (Page 2) (Full) February 28, 2008 The Democratic Party of Japan (DPJ or Minshuto) adopted yesterday in a meeting of its shadow cabinet a framework for its highway construction policy that contains five basic principles, including the integration of the special account of road-related taxes into the general account budget and abolishing the provisional tax rates, including the gasoline tax. The DPJ also adopted an outline of a bill to reform the special-purpose tax revenue system. The reform bill stipulates measures for revenue sources to be provided to local governments, in addition to reallocation of revenues from the gasoline tax, as well as abolition of the provisional tax rates. Considering these as its counterproposals to the government's bill amending the Special Taxation Measures Law, which would retain for another ten years the current provisional tax rates, the largest opposition party will submit its own bill now to the House of Councillors. Policy Research Committee Chairman Masayuki Naoshima pointed out: "Since our bill is significantly different from the (bill drafted by the government and ruling coalition),it will be difficult to launch consultations on revising the government's bill." Deputy President Naoto Kan also took the view that the ruling camp's broad compromise would become a precondition for consultations on revising the bill. He stated: "We have no intention of remaining flexible on the matter TOKYO 00000522 014 OF 015 by slightly changing the bill." 21) Measures to combat global warming: Leaders of 16 countries to meet during Lake Toya G-8 ASAHI (Page 1) (Excerpts) February 28, 2008 The government will hold a meeting of leaders of 16 major greenhouse gas emitters in conjunction with the Lake Toya G-8 (Summit) to be held in July in Hokkaido. The meeting will be joined by China, India, South Korea and Brazil, as well as G-8 member nations. This will be the largest forum for major economies to directly discuss global warming. Participants will aim at reaching a certain level of common understanding on an international framework to be launched in 2013, replacing the Kyoto Protocol. The meeting will have the participation of G-8 members, China, India, South Africa, South Korea, Brazil, Mexico, Australia and Indonesia. These countries account for 80 PERCENT of global greenhouse gas emissions. The government had been making preparations for inviting heavy emitters, such as China and India, aside from G-8 nations. In the end, it has sent invitations to eight countries. The government is now undertaking coordination with the possibility of holding the envisaged meeting between July 7-9 during the G-8. Since the development of Africa is also a major part of the Summit agenda, several leading African countries will also be invited. Leaders of more than 20 countries will gather at the Lake Toya Summit, exceeding the scale of the Kyushu-Okinawa Summit in 2000. 22) Foreign investment restriction to be eliminated from bill amending Airport Development Law; Cabinet decision to come as early as next week MAINICHI (Page 1) (Excerpts) February 28, 2008 The propriety of the inclusion in a bill amending the Airport Development Law of a clause restricting foreign investment in airport operators has been a focus of attention. The government yesterday started undertaking coordination with the possibility of deleting the clause from the bill. It will reach a decision at a cabinet meeting as early as next week. Some government officials are opposing the inclusion of the clause in the bill. As such, the government has decided that it would be necessary to reach a conclusion in order to give priority to early passage of this budget-related bill amending the Airport Development Law. According to that bill, the ratio of ownership by foreign companies of airport terminal operators, such as Narita International Airport Corp. and Japan Airport Terminal Co., would be limited to below one-third on a voting-right basis. The Ministry of Land, Infrastructure and Transport has aimed at introducing such a restriction for security reasons. However, cabinet ministers, such as State Minister for Financial Policy Yoshimi Watanabe, have been opposing the proposal as going against the trend of internationalization. The notion of limiting foreign investment in airport operators has been proposed with an eye on the listing of Narita International Airport Corp. on the stock market in fiscal ¶2009. The government sees that there will still be time for looking TOKYO 00000522 015 OF 015 into the issue, even if the clause is eliminated from the bill. SCHIEFFER