Identifier
Created
Classification
Origin
09TOKYO1165
2009-05-22 00:36:00
UNCLASSIFIED
Embassy Tokyo
Cable title:  

JAPANESE MORNING PRESS HIGHLIGHTS 05/22/09

Tags:  OIIP KMDR KPAO PGOV PINR ECON ELAB JA 
pdf how-to read a cable
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PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #1165/01 1420036
ZNR UUUUU ZZH
P 220036Z MAY 09
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 3162
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/USFJ //J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/CTF 72
RUEHNH/AMCONSUL NAHA 6477
RUEHFK/AMCONSUL FUKUOKA 4143
RUEHOK/AMCONSUL OSAKA KOBE 7945
RUEHNAG/AMCONSUL NAGOYA 1748
RUEHKSO/AMCONSUL SAPPORO 4674
RUEHBJ/AMEMBASSY BEIJING 9413
RUEHUL/AMEMBASSY SEOUL 5432
RUCNDT/USMISSION USUN NEW YORK 5183
UNCLAS SECTION 01 OF 12 TOKYO 001165 

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: JAPANESE MORNING PRESS HIGHLIGHTS 05/22/09

Index:
UNCLAS SECTION 01 OF 12 TOKYO 001165

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: JAPANESE MORNING PRESS HIGHLIGHTS 05/22/09

Index:
1) Top headlines
2) Editorials
3) Prime Minister's daily schedule (Nikkei)

4) U.S. Embassy hosts conference on international child abductions,
asks Japan to sign Hague Convention (Tokyo Shimbun)

5) Prime Minister Aso in speech pledges 6.7 billion dollars in aid
to Asia for projects, including development of the Mekong Delta
(Nikkei)

6) Meeting of G-8 energy ministers: Japan to propose regulating
speculators (Mainichi)

7) Ambassador-designate Roos seen as someone who can pick up the
phone and call President Obama on the issues (Yomiuri)

8) Government delegate Yachi denies making statement about reversion
of 3.5 northern islands (Yomiuri)

9) North Korea issues warning about danger zone where missiles would
be tested (Nikkei)

Diet agenda:
10) Upper House enters deliberation on anti-piracy bill (Sankei)
11) Democratic Party of Japan attacks wasteful projects in the
supplementary budget bill, including plan to build anime cartoon
arcade (Yomiuri)
12) DPJ deepening ties with labor federation Rengo (Sankei)
13) DPJ President Hatoyama already on a stumping tour of local areas
in preparation for the upcoming Lower House election (Sankei)
14) Restrictions on hereditary Diet seats being considered by LDP,
but this could affect even former Prime Minister Koizumi's son, who
is running for his seat (Sankei)

15) Government readying 4 trillion yen in emergency financing for
businesses hit hard by the economic recession (Nikkei)

16) Prime minister orders Council on Economic and Fiscal Policy to
include measures on falling birthrate in "big-boned" policies
(Sankei)

Articles:

1) TOP HEADLINES

Asahi, Yomiuri, Sankei & Tokyo Shimbun:

Ex-student arrested for killing Chuo University professor

Mainichi:
Contractor Kumagai Gumi suspected of providing politicians with 30
million yen in donations from 1995 through 2000 via dummy entities

Nikkei:
Aso vows 67 billion dollars in aid for Asian economic development

2) EDITORIALS

Asahi:
(1) Ban on inheriting seats: Make efforts to gather able personnel
in Diet

TOKYO 00001165 002 OF 012


(2) Kanji testing body must reform itself

Mainichi:
(1) Hatoyama DPJ urged to present measures to realize slogan "avert
bureaucratic meddling"
(2) Japan Post President Nishikawa's staying on: More explanation
needed

Yomiuri:
(1) Reorganize Health Ministry to regain public trust
(2) Obama policy may contribute to bringing about peace in Middle
East

Nikkei:
(1) Japan must make efforts to boost demand in Asia
(2) Japan needs to take lead in curbing greenhouse gas emissions

Sankei:
(1) Cool response imperative to prevent expansion of new flu
infections
(2) Circumstances for indictment of Suu Kyi incomprehensible

Tokyo Shimbun:
(1) Agreement urgently needed to ban nuclear testing
(2) Give priority to consumers in working out agriculture policy

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, May 21

NIKKEI (Page 2) (Full)
May 22, 2009

07:25 Met deputy chief cabinet secretaries Matsumoto and Asano at
the Kantei. Matsumoto stayed on.
09:01 Attended an Upper House Budget Committee session.
12:04 Returned to the Kantei.
13:00 Attended the Upper House Budget Committee session.
16:34 Met Finance Minister Yosano, Administrative Reform Minister
Amari, and Chief Cabinet Secretary Kawamura.
17:19 Attended a Council on Economic and Fiscal Policy meeting held
at the Kantei.
18:30 Attended a dinner party held at the Imperial Hotel by the
Future of Asia, an international exchange council.
19:26 Dined with his secretary at a restaurant in Toranomon.
21:39 Returned to his official residence.

4) Allow visitation of children across national borders: U.S.,
Canadian, French, British ministers urge Japan to sign Hague treaty

TOKYO SHIMBUN (Page 23) (Full)
May 22, 2009

Norio Noro

A symposium on finding a solution to the problem of Japanese
citizens married to foreigners bringing their children back to Japan
after divorce and denying the other parent visitation rights was
heard at the U.S. Embassy in Tokyo on May 21. The ministers of the
U.S., Canadian, French, and British embassies in Japan held a joint
news conference where they asked that the "Japanese government sign
the Hague treaty at an early date."

TOKYO 00001165 003 OF 012



Appeal by U.S., Canadian, French, and British ministers

U.S. Deputy Assistant Secretary of State Michele Bond spoke
earnestly about the "tragedy" of the affected parents and children:
"There have been 73 cases, affecting 104 children, of Japanese
parents, mostly mothers, bringing their children to Japan and
refusing visitation rights to the American parents. This is the
largest number among non-members of the treaty."

The Hague treaty protects children from the harmful effects of being
brought across borders unlawfully, returns them to the country where
they previously lived, and protects the right of parents to see
their children.

There are 81 members of this treaty, and Japan and Russia are the
only G-8 countries that have not signed the treaty. Japanese
citizens are involved in the largest number of disputes among the
East Asian countries, but the government has been unreceptive to the
treaty.

Minister David Fitton of the British Embassy said: "There have been
36 disputes since 2003, and 11 of them remain unresolved. There had
been no progress in the other cases and the British parents have
given up." French minister Christophe Penot reported that, "The
mother would not even accept the letter sent by the father to his
daughter in Japan, and he was devastated. This may develop into a
political issue between Japan and France."

Canadian minister Donald Bobiash also noted that "the protection of
children under treaty is also in the interest of Japan." Maura
Harty, senior policy director for the International Center for
Missing and Exploited Children in the United States, called for
"doing what is best for the children."

At the end of the news conference, U.S. Embassy Charg d'Affaires
James Zumwalt said: "Disputes are expected to increase from now on,
so this is an urgent and important issue." The joint press statement
issued strongly urges the Japanese government to "implement measures
such as facilitating parental visits."

5) Prime Minister Aso pledges 6.7 billion dollars for economic
development in Asia at 15th International Conference on the Future
of Asia

NIKKEI (Top Play) (Full)
May 22, 2009

Prime Minister Taro Aso on May 21 gave a speech at a dinner party
for the 15th International Conference on the Future of Asia, hosted
by Nihon Keizai Shimbun. In the speech, he announced that Japan
would take every measure to double Asian countries' gross domestic
product (GDP) by 2020. He then revealed a plan to extend financial
assistance totaling 6.7 billion dollars in the form of official
development assistance (ODA),trade insurance, etc. He also revealed
a plan to hold the first Japan-Mekong summit before year's end in
order to confer on the issue of developing five Southeast Asian
nations in the Mekong River Basin.

The speech given was titled "Toward Asia's Renewed Progress,
Overcoming the Economic Crisis." It embodies the prime minister's
"Initiative to Double Asian Economies" not only for Southeast Asian

TOKYO 00001165 004 OF 012


countries to surmount the current economic crunch but also for all
Asian countries to achieve mid- to long-term growth.

The prime minister noted that Asia should first regain its vitality
and spread it around the world. He stressed that in order to
overcome the economic crisis at an early date, it is very important
for various countries to fall in step toward expanding domestic
demand. He welcomed economic the stimulus measures taken by various
Asian countries and also called for continued cooperation with
measures to expand domestic demand.

He stressed that Asia's growth power should be strengthened from the
mid- to long-term perspective in order for its potential to be
realized. The speech also included a plan to back efforts to
consolidate wide-area infrastructure, including goods distribution
systems, and expand the middle class through improved social
security and education.

The speech especially placed importance on the correction of
disparities in the region of the Association of Southeast Asian
Nations (ASEAN). The Japan-Mekong summit will focus on discussions
regarding economic cooperation to Thailand, Vietnam, Cambodia, Laos
and Burma, which are still underdeveloped, and development issues.

The prime minister also stressed that he considers Russia could
become an important partner in achieving regional stabilization and
prosperity. He thus indicated his view that Russia, which is
focusing on the development of East Siberia and the Far East, will
play a role in the economic development of East Asia. Concerning the
pending Northern Territories issue, Aso said, "I am determined to do
my utmost to eliminate barriers between Japan and Russia."

The prime minister also said, "In order to maintain sustainable
growth, an environment where people can engage in activities with
safety and peace of mind is necessary." He then indicated his
intention to cooperate with various countries on cross-border
issues, such as measures to deal with the new influenza strain;
measures to curb global warming; and North Korean nuclear, missile,
and abduction issues.

Gist of prime minister's speech

He aims to double the GDP of Asian regions by 2020

Q In order to overcome the current economic/financial crisis, it is
important for various countries to fall in step toward expanding
domestic demand.

Q Further promote trade and capital transactions in the Asian
region. Use intraregional currency. Double the size of Asian
economies by 2020 through strengthened growth power. Propose
formulating a comprehensive development plan with private-public
sector cooperation in mind.

Q Japan will host the first Japan-Mekong summit to confer on the
development of five nations in the Mekong River Basin before year's
end

Q Possibility of Russia becoming a key partner in developing Asian
economies. Make utmost efforts to settle the territorial issue.

Q Call on various countries to cooperate in tackling health,

TOKYO 00001165 005 OF 012


environment and regional security issues in order to maintain
sustained growth.

Q Help Asian countries stockpile antivirus medicines as a measure to
deal with the new influenza strain

6) G-8 energy ministers meeting: Japan to propose controls on
speculators

MAINICHI (Page 6) (Full)
May 22, 2009

The Group of Eight (G-8) major nations will hold a two-day meeting
of their energy ministers in Rome from May 24. In the G-8 energy
ministerial, Japan will point out that speculative market players
have brought about excessive fluctuations in the prices of crude oil
and other natural resources. Japan will suggest the need to
strengthen transactions and oversights in order to ensure market
transparency. However, the U.S. and British governments remain
cautious about excessive market intervention. The ministerial is
therefore likely to have difficulties in its coordination.

The energy ministerial is expected to agree to set up an
"International Partnership for Energy Efficiency Cooperation," or
IPEEC for short, in the International Energy Agency for the spread
of energy-saving technologies. It will also discuss measures to cope
with climate change, including the feasibility of low carbon
society.

7) Who's Roos?

YOMIURI (Page 7) (Full)
May 22, 2009

Tatsuhito Iida, San Mateo, California

U.S. President Obama has decided to appoint John Roos, 54, as the
next ambassador to Japan. According to his law firm's website, Roos
is an able lawyer who shored up Obama's election campaign as one of
Obama's top fundraisers. He has little to do with Japan and his
ambassadorial capabilities are unknown. However, Roos is a confidant
of Obama who can call the president directly by phone.

Roos lives in the California county of San Mateo, which is situated
in the neighborhood of San Francisco. His residence is located in an
exclusive area where the average home price is one million dollars
(approx. 94 million yen).

On the morning of May 20, Roos, dressed casually in a white shirt
and navy blue pants, got into a Toyota Prius with his son. I shot a
question at him about his ambassadorial appointment. "I'm sorry,"
Roos responded, "but I can't make any comment." My next question was
when he would be formally designated. "I don't know," Roos said. He
added: "I really can't say anything. I'm now going to take my son to
school." So saying, Roos took the wheel and left his home.

According to a legal journal issued by Stanford University, Roos
graduated from its law school and then started to work at a Los
Angeles-based law firm. Later, with an eye on the future, Roos moved
on to a law firm in Silicon Valley. He distinguished himself in
corporate finance and has been the law firm's chief executive
officer since 2005. His law firm's clients include Google and many

TOKYO 00001165 006 OF 012


other well-known businesses. In the 1984 presidential election, Roos
took leave from work for a year to join the campaign staff of Walter
Mondale, who was a presidential candidate of the Democratic Party.
In last year's presidential election, Roos held a fundraising party
at his home shortly before Obama announced his candidacy and
promoted Obama to entrepreneurs and investors from Silicon Valley.
Some of the U.S. media have called him an "amazing fundraiser."

8) Yachi points out need to have new viewpoint on Northern
Territories, denying 3.5 islands remarks

YOMIURI (Page 4) (Abridged slightly)
May 22, 2009

Former vice foreign minister and currently government representative
Shotaro Yachi attended yesterday's House of Councillors Budget
Committee session as a government unsworn witness. There, Yachi
denied the Mainichi Shimbun's report that he had expressed a
willingness to accept the return of just 3.5 of the four
Russian-held islands off Hokkaido. It is the first time Yachi has
offered an explanation in public.

Before the committee, Yachi said: "I did not say that the (return)
of 3.5 islands would do. (The Northern Territories issue) needs a
new viewpoint, a new approach. The issue must be resolved in a way
that is acceptable to the public. We must put our heads together.
There is a need to draw up a big strategic design, including nuclear
energy, pipelines, the environment, the development of Far East
Siberia, and the integration of Russia into the Asia-Pacific."

Meanwhile, Prime Minister Taro Aso offered the following explanation
about the government's basic policy toward the Northern Territories
issue: "Once Japan's ownership over the four islands is confirmed,
we will deal with the question of when to actually return the
islands in a flexible manner. Japan's stance has been consistent."

The 3.5 islands approach is designed to evenly divide the disputed
Russian-held northern territories between Japan and Russia and to
return to Japan three islands -- Kunashiri, Shikotan, the Habomai
islet group -- plus part of Etorofu. The Mainichi Shimbun reported
last month that Yachi had referred to the return of 3.5 islands in
an interview. This has created a stir in Japan and in Russia.

9) N. Korea warns of another red zone for missile launches

NIKKEI (Page 2) (Full)
May 22, 2009

North Korea warned that it has set up another danger zone near its
coast for missile launches and other purposes, sources said
yesterday. The Japan Coast Guard picked up a radio warning that
prohibits sea traffic within waters 137 kilometers south of
Musudanri on May 15-30 between 10 a.m. and 6 p.m., Japan time.

A high-ranking official of the government explained: "A small rocket
won't get into international waters. That will have no impact on
Japanese fishing boats." Another high-ranking official said, "It's
part of their military training exercises."

10) Yachi points out need to have new viewpoint on Northern
Territories, denying 3.5 islands remarks


TOKYO 00001165 007 OF 012


YOMIURI (Page 4) (Abridged slightly)
May 22, 2009

Former vice foreign minister and currently government representative
Shotaro Yachi attended yesterday's House of Councillors Budget
Committee session as a government unsworn witness. There, Yachi
denied the Mainichi Shimbun's report that he had expressed a
willingness to accept the return of just 3.5 of the four
Russian-held islands off Hokkaido. It is the first time Yachi has
offered an explanation in public.

Before the committee, Yachi said: "I did not say that the (return)
of 3.5 islands would do. (The Northern Territories issue) needs a
new viewpoint, a new approach. The issue must be resolved in a way
that is acceptable to the public. We must put our heads together.
There is a need to draw up a big strategic design, including nuclear
energy, pipelines, the environment, the development of Far East
Siberia, and the integration of Russia into the Asia-Pacific."

Meanwhile, Prime Minister Taro Aso offered the following explanation
about the government's basic policy toward the Northern Territories
issue: "Once Japan's ownership over the four islands is confirmed,
we will deal with the question of when to actually return the
islands in a flexible manner. Japan's stance has been consistent."

The 3.5 islands approach is designed to evenly divide the disputed
Russian-held northern territories between Japan and Russia and to
return to Japan three islands -- Kunashiri, Shikotan, the Habomai
islet group -- plus part of Etorofu. The Mainichi Shimbun reported
last month that Yachi had referred to the return of 3.5 islands in
an interview. This has created a stir in Japan and in Russia.

11) DPJ attacks "Anime Hall of Fame" in Upper House Budget Committee
session

YOMIURI (Page 4) (Abridged slightly)
May 22, 2009

The major opposition Democratic Party of Japan (DPJ) fiercely
attacked in yesterday's House of Councillors Budget Committee
session the government's plan to use part of the fiscal 2009
supplementary budget to build what is called the National Media Arts
Center.

The envisaged center will be a base facility to collect, exhibit,
and study animated films, comic strips and cartoons, and games. The
center is also dubbed the "anime hall of fame." The concept has been
studied since last August by a blue-ribbon panel of the Cultural
Affairs Agency. Tokyo's Odaiba district has been cited as the
potential site for center. About 11.7 billion yen, the amount
equivalent to the cost of the construction of the center, is
incorporated in the supplementary budget.

DPJ lawmaker Kohei Otsuka criticized the plan during the session,
saying, "(The government) has decided to build the center after only
six meetings in six months." Otsuka also revealed the fact that
Cultural Affairs Agency Director-General Tamotsu Aoki had said
during the panel's last meeting on April 21, "There would not be an
opportunity to budget funds like this in the next 50, 100 years."
Aoki admitted that he had made such a statement.

Perceiving the center as a facility symbolizing the wasteful

TOKYO 00001165 008 OF 012


spending of budgets in the name of additional steps to shore up the
economy, DPJ President Yukio Hatoyama has also condemned it as a
huge government-run comic caf. Shozaburo Jimi of the People's New
Party, too, said before the committee, "It is bureaucrats' product
to please Prime Minister Taro Aso, who loves comics."

The prime minister rebutted, "Animated films and TV games will
become a new growth area in the Japanese economy." Finance Minister
Kaoru Yosano, too, reacted strongly, calling it a "longstanding
pending issue." At the same time, there is the view in the ruling
bloc that if the cost had been included in the fiscal 2009 budget,
criticism to this degree would not have emerged."

12) Rengo, DPJ to promote dialogue with residents from June

SANKEI (Page 5) (Full)
May 22, 2009

The Japan Trade Unions Confederation (Rengo),the largest support
body of the main opposition Democratic Party of Japan (DPJ),decided
yesterday that Rengo Chairman Tsuyoshi Takagi together with senior
DPJ members will hold a dialogue with residents in nine places
across the nation in June and July. The new DPJ leadership has now
launched following the resignation of Ichiro Ozawa as DPJ president
over the indictment of his chief secretary for accepting alleged
illegal donations from Nishimatsu Construction Co. Therefore, Rengo
intends to strengthen cooperation between itself and the DPJ with an
eye on a victory in the new House of Representatives election.

It is expected that such DPJ leaders as President Yukio Hatoyama,
Deputy President Ichiro Ozawa and Secretary General Katsuya Okada
will join Takagi. With the next general election in mind, the
planned sessions will be held in urban areas in which there are many
unaffiliated voters. They will play up the Rengo and DPJ
connection.

Since there were mixed views among Rengo leaders on whether Ozawa
should resign from the DPJ's top post or not, the distance between
Rengo and Ozawa widened. However, the support rates for the DPJ then
rose in the polls conducted by the media, even though Hatoyama
picked Ozawa as his deputy in charge of election strategy. With this
in mind, Rengo is determined (to step up its cooperation with the
DPJ). "We can push forward with strong election strategy along with
Mr. Ozawa, who enjoys the confidence of Rengo's local chapters."

13) DPJ President Hatoyama sets out on stumping tour in Saitama

SANKEI (Page 5) (Full)
May 22, 2009

Democratic Party of Japan (DPJ) President Yukio Hatoyama yesterday
visited Saitama City to give a speech to support the mayoral
campaign of a candidate backed by the DPJ's Saitama chapter. The
Saitama mayoral election will take place on May 24. Hatoyama's
stumping tour is the first since assuming the party's presidency.

Hatoyama delivered the speech in front of the JR Omiya Station. The
incumbent mayor, who is a candidate backed by the ruling Liberal
Democratic Party (LDP) and New Komeito, is seeking a third term.
With this in mind, Hatoyama emphasized: "Any long-term
administration becomes corrupt. We want to bring about a change in
administration to Saitama City." Regarding "a fraternal society,"

TOKYO 00001165 009 OF 012


creation of which is his argument, Hatoyama explained: "(The society
that I want to create) is a society in which the baby boomers are
not treated as burdens, but where they are happy with doing
volunteer activities."

The mayoral election is contested between the candidate backed by
the DPJ Saitama chapter and the incumbent mayor.

According to a source familiar with the DPJ, it is unusual for the
party head to go stumping for a candidate supported by a prefectural
chapter. Hatoyama went to Saitama have the candidate win the race
and to bolster his party's strength for the next Lower House
election.

14) LDP mulling restrictions on hereditary candidates from next
Lower House election; Koizumi's second son running as independent?

SANKEI (Page 2) (Slightly abridged)
May 22, 2009

The Liberal Democratic Party (LDP) began considering the
introduction of restrictions on the candidacy of new hereditary
candidates from the next House of Representatives election on May

21. This was revealed by a senior official of the Election Strategy
Council. This official indicated that former prime minister
Junichiro Koizumi's second son, Shinjiro (11th district of Kanagawa)
and former justice minister Hideo Usui's eldest son, Shoichi (first
district of Chiba) will not be designated as the party's official
candidates. If such a decision is made, the two will most probably
run as independents. There is a proposal for the LDP not to field a
rival candidate in these districts and to recognize them as party
members after they get elected. However, there are also dissenting
opinions in the party, so the final decision will be left to the
president, Prime Minister Taro Aso.

There is opposition in the LDP to restrictions on hereditary
candidates, especially among the second-generation Diet members. The
reason restrictions are going to be imposed despite such opposition
is because this is meant to counter the plan of the Democratic Party
of Japan (DPJ) to apply restrictions on new hereditary candidates
from the next Lower House election and make this a point of
contention in the election.

However, only Shinjiro and Shoichi will be affected. It is reported
that Election Strategy Council Vice Chairman Yoshihide Suga, who is
the head of the LDP Kanagawa chapter, and former secretary general
Tsutomu Takebe, who is close to former prime minister Koizumi, are
coordinating on this. A senior LDP official pointed out: "The party
will not field an official candidate. Shinjiro and Shoichi will be
elected even if they run as independents. We can just recognize them
after the election."

If they are recognized ex post facto, they will become LDP official
candidates in subsequent elections, so this may not sit well with
the idea of restricting hereditary candidates. Therefore, the DPJ is
criticizing this as "indirect recognition (as official candidate),"
(says a senior DPJ official).

At the first meeting on May 21 of the "Association for Pioneering
New Politics," (chaired by Lower House member Taro Kono) a
parliamentary union working for restrictions on the hereditary
system, Suga stressed that, "The LDP, a party of the people, should

TOKYO 00001165 010 OF 012


take in a great variety of talented people. We should put a stop (to
the hereditary system) through self-purification."

Some 50 lawmakers, including former secretary general Hidenao
Nakagawa and junior Diet members, attended the meeting. They agreed
that restrictions on hereditary candidacy should be written into the
party's manifesto for the Lower House election.

At a meeting of the party's Reform Implementation Headquarters
(chaired by Takebe) on the same day, a proposal for a new party rule
that prohibits direct descendants of Diet members running in the
same constituency from being recognized as official candidates from
the next Lower House election was presented. The recommendation with
be made to Aso before the end of May.

15) Government, banks to launch emergency lending program of 4
trillion yen

NIKKEI (Page 1) (Full)
May 22, 2009

The government and Development Bank of Japan (DBJ) have decided to
introduce an emergency lending program possibly in June for large
and mid-sized companies, with the government and private-sector
banks each contributing 50 percent of the financing burden in
principle. The government aims to make commercial banks more willing
to lend by having the DBJ shoulder half of the financing and also to
avoid official loans from being exposed to excessive risks. The
government envisions a program worth up to 4 trillion yen, with 2
trillion yen to be shouldered by the DBJ and to come from the 15
trillion yen earmarked for emergency lending in its additional
economic stimulus package and 2 trillion from commercial banks.
Given that companies have found it difficult to raise funds, the
government will take full measures to facilitate money to flow into
companies.

Because a rise in corporate bankruptcies and other factors have
caused many loans to sour, banks remain cautious about lending. The
government has judged it necessary to make banks more willing to
lend in order to promote the smooth inflow of money into
corporations by having the DBJ shoulder half of the lending burden.
In this new program, companies' main lenders, which could be major
or regional banks, present lists of potential borrowers to the DBJ.
These banks will select candidates based on such conditions for
lending as credit ratings and capital ratios, simplifying the DBJ's
loan approval process. Under this system, it will become possible
for the DBJ to screen applications for loans from companies, based
on their financial data, even if it has no business dealings and
knows nothing about their asset components.

Companies eligible for loans under the program will be sound
mid-sized firms capitalized at 1 trillion yen or less, with several
hundred million yen to several billion yen to be provided in each
case. Large firms will also be allowed to apply for loans.

If these loans become unrecoverable, taxpayers might be pressed to
foot a portion of the bill, because the DBJ will be able to ask the
government to guarantee half of the loan amount. For the loans
offered by private-sector banks, however, there will be no
government guarantees. The DBJ has said that it will carry out
strict screening in order to prevent defaults.


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Companies will be able to use the borrowed funds only for newly
needed operating funds and capital investment. Regarding the period
of emergency lending, many of the loans are expected to be for about
a year.

16) Prime minister orders Council on Economic and Fiscal Policy to
include measures on falling birthrate in "big-boned" policies;
health minister to draw up new road map

SANKEI (Page 2) (Full)
May 22, 2009

Prime Minister Taro Aso ordered relevant ministers to include
measures to deal with the falling birthrate in the basic policies
for FY2010 economic and fiscal management ("big-boned" policies) at
the Council on Economic and Fiscal Policy on May 21. Minister of
Health and Labor Yoichi Masuzoe announced at the meeting that he
would draw up a new road map for the reinforcement of social
security functions up to 2015 and will introduce a new system for
unified provision of services to support child rearing.

On the measures to arrest the declining birthrate, Aso indicated
that, "bold measures comparable to the economic stimulation package
should be taken." He also pointed out that, "So far, we have focused
our social security measures on the aged. However, support for young
people and child rearing households has emerged as the most
important issue that the country needs to work on as a whole."

The prime minister is advocating the strengthening of measures to
deal with the falling fertility rate because there have been strong
demands at the government's "Council for the Realization of a
Society of Peace of Mind" for the reinforcement of such measures,
and these will constitute the main component of the Council's final
report to be issued in mid-June. This is also meant to counter the
proposal of the Democratic Party of Japan for a monthly "child
allowance" of 26,000 yen in the forthcoming House of Representatives
election.

Private-sector members of the Council have also proposed the use of
consumption tax revenues for measures to rectify social disparities,
such as free preschool education and welfare payments to low-income
earners. They asked for the measures to remedy social disparities to
be included in the social security measures which have been
designated as the budget allocation that consumption tax revenues
will pay for in the "mid-term program" for tax reform.

Specifically, there was a proposal for the creation of "tax
deduction with welfare payments," using consumption tax money for
funding, to help low-income earners and others.

Meanwhile, in the new road map proposed by Masuzoe, the following
interim measures to deal with low birthrate will be implemented: 1)
building of more day care centers and after-school facilities by
2011; 2) expansion of the system of home nurseries; 3) expansion of
free maternity checkups; and 4) requiring employers to allow shorter
working hours for employees with small children.

In addition, longer-term measures will include the creation of a new
unified system of providing child rearing support services by 2015,
uninterrupted day care services to help parents cope with both work
and family life, and a plan to allow the use of "temporary day care"
of up to 20 hours even by full-time housewives.

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