JAPANESE MORNING PRESS HIGHLIGHTS 07/15/09

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SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 07/15/09

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

Political meltdown:
4) Democratic Party of Japan (DPJ) files a no-confidence motion in
the Lower House and a censure motion in the Upper House against
Prime Minister Aso (Asahi)
5) Koga quits as LDP's election strategist, but Prime Minister Aso
says he will not accept the resignation (Tokyo Shimbun)
6) The Diet for all practical purposes is now closed (Yomiuri)
7) DPJ happy at being able to crush the LDP, but worried that Aso
might quit and a more popular leader will take his place prior to
the national election (Sankei)

Opinion polls:
8) Aso Cabinet non-support rate in Yomiuri poll now at an
astronomical 72.1 PERCENT , with most respondents wanting the
national election to be as soon as possible (Yomiuri)
9) LDP's base support is shrinking according to latest Yomiuri poll
(Yomiuri)
10) Poll shows small businesses now feel the economy is getting
worse (Nikkei)

Defense and security issues:
11) Cargo inspection bill to be scrapped with the closing of the
Diet (Sankei)
12) DPJ President Hatoyama says his party might be willing to
acknowledge nuclear-loaded warship making port calls and transiting
Japan (Nikkei)
13) Foreign Minister Nakasone says he is unwilling to look into the
allegation of a secret nuclear pact with the U.S. (Yomiuri)
14) Japan Business Federation proposes easing of Japan's three
no-weapons export principles (Mainichi)
15) Government complete final procedures for ratifying international
cluster-munitions ban treaty (Mainichi)
16) To end Congressional impasse over F-22s, Senators McCain and
Levin submit bill to end their procurement, sealing off Japan's bid
to obtain such aircraft (Sankei)

17) One of the casualties of the DPJ boycott of the Upper House is
the child-pornography law that is now likely to be scrapped
(Yomiuri)

Articles:

1) TOP HEADLINES

Asahi:
DPJ submits no-confidence motion to prevent Aso's resignation

Mainichi:
Voices to seek Aso's resignation remain in LDP

Yomiuri, Tokyo Shimbun and Akahata:
Upper House approves censure motion against Aso

Nikkei:
Listed firms' unfunded pension liabilities doubles to 13 trillion
yen


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Sankei:
Introduction of hybrids with expensive automobiles

2) EDITORIALS

Asahi:
(1) Diet at standstill: Aso's dissolution announcement creates
unnecessary political vacuum
(2) Kirin-Suntory merger: Time for realignment with eye on Asian
market

Mainichi:
(1) Review of Tokyo assembly election: Political parties should
concentrate on drafting campaign pledges
(2) Reelection of Yudhoyono: Continue effort to reconstruct the
country

Yomiuri:
(1) Censure motion against Aso passed: Is DPJ going to scrap cargo
inspection bill?
(2) Revised Organ Transplant Law: In order to increase rely of
lives

Nikkei:
(1) Kirin, Suntory aim at leap abroad
(2) Anxiety about unity in LDP

Sankei:
(1) Ruling, opposition parties urged to agree at party-heads meeting
to pass cargo inspection bill
(2) Organ transplant: take adequate measures for mental care

Tokyo Shimbun:
(1) Turmoil in LDP: Is it a sign that LDP will enter the election
split into two groups?
(2) Realignment of beer industry: Falling population prompts merger


Akahata:
(1) 87th anniversary of JCP's funding: Eying future, living the
present

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, July 14

NIKKEI (Page 2) (Full)
July 15, 20

07:36 Took a walk around the official residence.
10:01 Cabinet meeting at the Kantei. METI Minister Nikai stayed
behind. Then met with Transport Minister Kaneko, followed by
Agriculture Minister Ishiba.
10:50 Met with incoming vice minister Suzuki and outgoing vice
minister Takino of the Internal Affairs Ministry. Then met with
incoming vice minister Kobayashi and outgoing vice minister Nishio
of the Environment Ministry, followed by incoming vice minister
Tango and outgoing vice minister Sugimoto of the Finance Ministry.
11:24 Met with incoming vice minister Ono and outgoing vice minister
Ozu of the Justice Ministry, followed by incoming vice minister
Sakata and outgoing vice minister Zeniya of MEXT Ministry and
incoming director general Mikuniya and outgoing director general

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Sato of the Financial Services Agency.
12:50 Meeting of the lawmakers' council.
13:05 Lower House plenary session.
14:55 Arrived at the Kantei.
15:31 Upper House plenary session.
16:32 Met with Chairman Ishida of the Liaison Council of the LDP
Secretaries General at the Kantei.
17:07 Met with Chief Cabinet Secretary Kawamura.
17:32 Lower House plenary session. Then met with Lower House Speaker
Kono.
18:20 Met with Secretary General Hosoda. Kawamura was present.
Kawamura stayed behind.
19:01 Public Relations Headquarters chief Furuya.
20:10 Arrived at the official residence.

4) Aim of preventing Aso from stepping down lies in DPJ's submission
of non-confidence resolution, censure motion

ASAHI (Top Play) (Slightly abridged)
July 15, 2009

The Democratic Party of Japan (DPJ) and other opposition parties
endorsed a nonbinding censure motion against Prime Minister Taro Aso
at a plenary session of the House of Councillors yesterday. This is
the second passage of a censure motion against a prime minister,
following one against (then) prime minister Yasuo Fukuda in June

2008. Meanwhile, the House of Representatives voted down a
no-confidence motion against the Aso cabinet. In these votes, there
were no rebels among the Liberal Democratic Party (LDP) members. But
anti-Aso moves are still going on in the LDP, and the DPJ is putting
more pressure on the LDP.

DPJ plots strategy to have LDP members put confidence in Aso

Taking advantage of the gathered momentum following its overwhelming
victory in the Tokyo Metropolitan Assembly election on July 12, the
DPJ wants to fight against unpopular Prime Minister Aso in the next
general election. By presenting a censure motion and a
non-confidence motion, the main opposition party paved the way to
draw out a decision by Aso to dissolve the Lower House.

In a meeting of DPJ lawmakers yesterday, President Yukio Hatoyama
indicated that the submission of the censure motion and the
non-confidence motion prompted the prime minister to announce a
timetable for dissolving the Lower House. Hatoyama said:

"As a result of our submission of the censure motion and the
non-confidence motion, Prime Minister Aso decided to dissolve the
Diet on his own discretion. On Aug. 30 (the voting day),we will see
a change in Japanese history."

Due to its crushing defeat in the Tokyo election, the LDP is
supposed to have no choice but to decide on the timeframe for Diet
dissolution in order to contain the "Aso-dumping" moves. The DPJ
calculated that the submission of a censure motion and a
non-confidence motion must work effectively to urge the prime
minister to make a decision. This prediction came true. Aso decided
on July 13 to dissolve the Diet in the week starting July 21 and
hold an election on Aug. 30 after a tug-of-war with senior ruling
party members.

However, uncertainty is still looming over a resignation of the

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prime minister, as DPJ Secretary General Katsuya Okada said: "If the
prime minister intends to dissolve the Diet seriously, there is no
need to wait another week." Under this situation, the DPJ's another
aim was laid in its submission of the non-confidence motion.

LDP members who distance themselves from Aso, including former
secretaries general Hidenao Nakagawa and Tsutomu Takebe, voted down
the motion in a Lower House plenary session yesterday, causing boos
from DPJ and other opposition party members.

In the Lower House, the ruling parties hold a two-thirds majority,
so it is difficult to pass a non-confidence motion. In addition, for
ruling party members, approving a motion is tantamount to a breach
of trust that will lead to the removal of their names from the roll.
Given this, LDP members had to place confidence in Prime Minister
Aso, and eventually they now find it difficult to move to urge Aso
to step down. This was indisputably what the DPJ was aiming at.

Opposition parties have boycotted Diet deliberations following the
submission of the resolution. Accordingly, the ruling coalition's
attack on Hatoyama over the issue of false donation statements will
be blocked.

Looking at disorder in the LDP, the DPJ has started preparations to
grab the reins of government. Even so, there are still 50 days until
the election. A tense atmosphere is sweeping across the DPJ, as a
mid-ranking official remarked: "Nobody know what could happen from
now." The ruling bloc intends to continue pursuing the Hatoyama
donation scandal. Now that a change of government is taking on a
touch of becoming a real possibility, the DPJ needs to hurriedly
make preparations for a transfer of power.

In a press conference yesterday, Hatoyama said:

"A change of government was just a dream until now. But if we win
the next general election, a change of government will take place.
We are determined to fight the election with a stronger sense of
responsibility than before."

5) LDP Election Strategy Council Chairman Koga's resignation
announcement expanding turmoil in the party; LDP executives come
under attack at General Council meeting; Aso says, "I have no
intention to accept resignation"

TOKYO SHIMBUN (Page 1) (Full)
July 15, 2009

Mikio Kanesugi, political department

The turmoil in the ruling Liberal Democratic Party (LDP) has
expanded due to party executives coming under attack at a General
Council meeting yesterday, as well as Election Strategy Council
Chairman Makoto Koga's expression of his intention to resign. Koga
expressed his intention to step down from his post to take
responsibility for the LDP's crushing defeat in the Tokyo
Metropolitan Assembly election on July 12, and for the turmoil he
caused by calling on Miyazaki Gov. Hideo Higashikokubaru to run on
the LDP ticket in the next House of Representatives election.
However, Koga's announcement of "his desertion in the face of the
enemy" soon before Lower House dissolution has deepened further
anxiety in the party about going into the general election under
unpopular Prime Minister Taro Aso's leadership.

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"I caused the party trouble with the Higashikokubaru issue, so I
will resign," said Koga and left the General Council meeting
yesterday. A participant said Koga appeared to have spoken with
emotion that he would quit his post, since the party executives were
coming under criticism.

Koga had maneuvered to field Higashikokubaru in the general election
to help the LDP achieve a victory in the poll. However, many LDP
members criticized Koga for trying to ride on the popular
Higashikokubaru's coattails, and public opinion reacted coolly.
"Since there was a rumor that Higashikokubaru will run in the
election from the Tokyo (proportional representation bloc),I was
asked by my supporters whether the LDP would be all right with
that," said LDP Tokyo chapter head Nobuteru Ishihara. Some say that
the Higashikokubaru issue became one of the reasons for the LDP's
Tokyo election setback. Koga has been greatly unhappy at being
treated like a war criminal.

Aso clearly told reporters last evening: "I have no intention to
accept his resignation." He instructed to LDP Secretary General
Hiroyuki Hosoda to persuade Koga to retract his earlier remark, but
Koga has no intention to withdraw for now.

While the LDP is expected to suffer a setback in the upcoming
general election, the party's Election Strategy Council chairman
made an unusual resignation announcement. The LDP has yet to find
any means to regain its party strength. Hosoda's call for "party
unity for the election" has not reached the rank and file party
members.

6) Censure motion against Prime Minister endorsed, no-confidence
motion voted down; Diet effectively in out-of-session mode

YOMIURI (Top play) (Excerpts)
July 15, 2009

A no-confidence motion against the cabinet submitted by four
opposition parties - the Democratic Party of Japan (DPJ),the
Japanese Communist Party, the Social Democratic Party, and the
People's New Party - was voted down by a majority of votes by the
Liberal Democratic Party and the New Komeito during yesterday's
House of Representatives plenary session. Meanwhile, the
opposition-controlled House of Councillors adopted a censure motion
against Prime Minister Taro Aso submitted by the four opposition
parties plus the New Party Nippon. Consequently, the opposition bloc
has decided to boycott all Diet deliberations, throwing the Diet
effectively into an out-of-session mode ahead of its adjournment on
July 28. Given the Prime Minister's plan to dissolve the Lower House
on July 21, both the ruling and opposition blocs have now
effectively kicked off their campaigning for the election on Aug.

30.

Prime Minister Aso told the press corps last night at his official
residence: "I feel grateful that almost all LDP lawmakers (opposed)
the no-confidence motion. I take the motion seriously."

The motion was voted down with a vote of 333 to 139. Although Kotaro
Nagasaki, who has submitted his letter of secession from the LDP,
was absent, no LDP lawmakers voted for the motion. Among former LDP
lawmakers, ex-METI Minister Takeo Hiranura voted against the motion,
while former Administrative Reform Minister Yoshimi Watanabe, former

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Construction Minister Kishiro Nakamura and others voted for it.

The censure motion (submitted to the Upper House) was adopted with a
vote of 132-106. It became the second case to win approval following
one submitted in June 2008 against then Prime Minister Yasuo Fukuda.
Although the motion is unbinding, the opposition bloc has decided to
boycott future Diet deliberations on the strength of the endorsed
motion. As a result, 17 government-sponsored bills, including a
North Korea ship inspections bill, and 91 lawmaker-initiated bills
are now certain to be scrapped.

At an LDP Lower House members' meeting held ahead of the Lower House
plenary session, Prime Minister Aso announced a plan to set the
stage for reexamining the ruling coalition's humiliating defeat in
the latest Tokyo election, saying, "By taking the result humbly, we
will reexamine it and respond to it based on our reflections on the
result." Meanwhile, former Secretary General Hidenao Nakagawa sought
the replacement of the prime minister, saying, "The party needs a
change of heart and people. Discussion must be conducted at a
general meeting of LDP Diet members from both chambers."

LDP not to field Higashikokubaru

The possibility has become stronger that the LDP will give up on the
idea of fielding Miyazaki Gov. Hideo Higashikokubaru for the
upcoming Lower House election, according to an LDP source yesterday.
Behind the prospect lies the fact that the party's request for the
popular governor's candidacy for the next Lower House election has
drawn fire from the public, in addition to its serious setback in
the July 12 Tokyo poll that was followed by Election Strategy
Council Chairman Makoto Koga's announcement yesterday to step down
from the post.

Koga made the following comment to the press corps at LDP
headquarters yesterday: "The manifesto (a set of campaign pledges)
is our soul. If an agreement is not reached, I wonder what kind of
decision Mr. Higashikokubaru will make." Witnessing the LDP's strong
reaction, Higashikokubaru cautiously said, "The situation seems very
severe."

7) DPJ in optimistic mood but still wary: Ozawa spearheading party
with eye on upcoming election

SANKEI (Page 5) (Excerpts)
July 15, 2009

The endorsement of a censure motion against Prime Minister Taro Aso
has boosted morale among members of the Democratic Party of Japan
(DPJ) on July 14, with an eye on confronting the prime minister in
the campaign for the upcoming Lower House. President Hatoyama said,
"The time has come at last." Some are concerned that the party's
election stance might cause members to let their guards down due to
their great successes in major local elections, including the Tokyo
Metropolitan Assembly election.

Deputy President Ichiro Ozawa has been keeping a low profile due to
the Nishimatsu Construction scandal. However, he has begun appearing
out front, determined to bring about a change in government, his
lon-cherished desire.

After the Lower House plenary session voted down the no-confidence
motion against the prime minister, DPJ Supreme Advisor Kozo Watanabe

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told reporters with a smile: "Those who voted against the
no-confidence motion (among anti-Aso forces in the Liberal
Democratic Party = LDP) are now unable to try to oust Aso. We
appreciate that we will go into the election while the prime
minister is Mr. Aso in terms of our party interests."

The disarray in the LDP caused by Election Committee Chairman Makoto
Koga's announcement of his decision to step down is also working as
a boost to the DPJ. President Hatoyama said, "What the LDP is doing
is undeniably not like that of the ruling party."

The DPJ has assumed an election mode, totally boycotting Diet
deliberations. Secretary General Katsuya Okada at a meeting of the
lawmakers council and a plenary meeting of Upper House members
encouraged participants to focus on the decisive battle, noting:
"The Diet session will end today in effect. I would like you to
return to your home constituencies and fully engage in (campaign)
activities."

Some party members have a sense of alarm with one senior Election
Committee member saying, "If an optimistic mood permeates, the
ruling parties will recover from a setback." Since there are nearly
50 days until the election, some are concerned that our activities
could fall into a slump."

Deputy President Naoto Kan also warned at an executive meeting, "We
must brace up, as a rebound from our landslide victory in the Tokyo
election could come."

8) Poll: 56 PERCENT wanted earlier election, 70 PERCENT don't
support Aso cabinet

YOMIURI (Page 1) (Abridged)
July 15, 2009

Prime Minister Aso is now determined to carry out an election for
the House of Representatives on a schedule to announce it on Aug. 18
and set voting and vote-counting for Aug. 30. The Yomiuri Shimbun
conducted a telephone-based spot nationwide public opinion survey
from the afternoon of July 13 through yesterday. Asked about this
election scheduling, a total of 56 PERCENT answered that they
wanted the election set earlier than that date, with 30 PERCENT
saying it was appropriate and 10 PERCENT saying they wanted it set
later than that date. Asked about the ruling Liberal Democratic
Party's preparedness for the election under Aso, 46 PERCENT said it
was good, with 40 PERCENT saying they wanted him to be replaced
with someone else. The Aso cabinet's support rate was 18.6 PERCENT ,
down from the 19.7 PERCENT rating in the last spot survey taken
July 2-3 after Aso's ad hoc appointments of cabinet ministers. The
nonsupport rate rose to 72.1 PERCENT from 66.4 PERCENT , topping 70
PERCENT since it last did in the March 6-8 survey (74.8 PERCENT ).

In the breakdown of public support for political parties, the
leading opposition Democratic Party of Japan (Minshuto) scored 30.1
PERCENT (28.6 PERCENT in the last spot survey),with the LDP at
24.8 PERCENT (25.5 PERCENT in the last spot survey).

9) Poll: LDP supporters wavering

YOMIURI (Page 2) (Abridged)
July 15, 2009


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The ruling Liberal Democratic Party's crushing defeat in the recent
election for the Tokyo metropolitan assembly had great repercussions
on its supporters, the Yomiuri Shimbun found from its spot
nationwide public opinion survey. The LDP's turf is becoming shaky
with Prime Minister Aso as its leader.

Aso has now made up his mind to announce an election for the House
of Representatives on Aug. 18 and set voting and vote-counting for
Aug. 30. Among LDP supporters, 45 PERCENT said it was appropriate,
with 33 PERCENT saying they wanted the election set earlier than
that date. Among those who support the leading Democratic Party of
Japan (Minshuto),more than 72 PERCENT said the election should
have been set for an earlier date, with 23 PERCENT saying it was
appropriate. The figures apparently show the difference between the
mindsets of DPJ supporters and LDP supporters. DPJ supporters want
to keep up the momentum of the DPJ's overwhelming victory in the
Tokyo metropolitan assembly election with the House of
Representatives election scheduled early on, while LDP supporters
want to set up a cooling-off period.

Asked about the outcome of the Tokyo metropolitan assembly election,
46 PERCENT of LDP supporters said it was not good, but 37 PERCENT
said it was good. The Aso cabinet's support rate remains low, and
the LDP is still in trouble. The figures shown in the survey seem to
reflect dissatisfaction with Aso and the LDP.

Such dissatisfaction can also be seen in the ratings on the LDP's
preparedness to conduct the forthcoming House of Representatives
election with Aso as its leader. Among LDP supporters, 53 PERCENT
said it was good, but 37 PERCENT said they wanted Aso to be
replaced with someone else. Aso has now set a schedule for the House
of Representatives election. The figures, however, show that a
number of LDP supporters still want the prime minister to be
replaced.

10) Nikkei poll: 41 percent of small- and medium-size businesses see
the economy as having worsened, topping those who answered it has
improved

NIKKEI (Page 1) (Abridged slightly)
July 15, 2009

According to a survey of small- and medium-size business operators
conducted by the Nihon Keizai Shimbun on July 14, 41 percent of
respondents said that the domestic economy has worsened or is
showing signs of further deteriorating, topping those who said that
the economy has improved, who marked 26 percent. While leading
companies' financial health is improving, small- and medium-size
businesses remain in severe condition.

However, 31 percent said that they would increase their research and
development budgets for fiscal 2009. Despite adverse circumstances,
the companies are strengthening their stance of pursuing technical
development in such areas as the environment in order to assure
future growth.

The survey, the fifth of its kind, was carried out targeting the
managers of 500 small- and medium-size businesses throughout the
nation. The survey sent questionnaires on June 30 and received
replies from 263 by July 10.

The survey asked how respondents compare the present situation of

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the domestic economy with that of six months ago. Thirty-five
percent said that the economy has declined further. The ratio of
those who have a negative view of the present economic situation
reached 41 percent, if the ratio of respondents who replied that the
economy is showing signs of further deterioration - 7 percent - is
combined. Only one company or 0.4 percent said that the economy has
improved. The ratio of companies that replied that the economy is
showing signs of improvement stood at 26 percent.

According to a poll of 100 corporate managers, which this newspaper
carried out in late June, targeting leading companies, 49 percent
said that the economy has improved, topping those who replied that
the economy has worsened - 33 percent. The results of the two polls
indicate that while leading companies have started easing production
cuts, small- and medium-size companies' business confidence remains
sluggish.

11) Cargo inspection bill to be scrapped

SANKEI (Page 3) (Abridged)
July 15, 2009

A special measures bill allowing the country to inspect cargos of
North Korea-related vessels cleared the House of Representatives
yesterday afternoon after it was approved by the Lower House
Antipiracy Special Committee and a Lower House plenary session by a
majority of votes by the ruling parties. Meanwhile, the opposition
camp has decided to boycott all Diet deliberations following the
House of Councillors' adoption of a censure motion against Prime
Minister Taro Aso. As a result, the cargo inspection bill is certain
to be scrapped when the Lower House is dissolved.

Japan took the initiative in having the UN Security Council adopt a
sanctions resolution on North Korea in the wake of the reclusive
country's second nuclear test. Japan's failure to enact the cargo
inspection legislation will block the complete implementation of the
UN resolution and it might end up destroying a plan to build an
international net keeping an watchful eye on North Korea. Further,
Japan's failure to join the cargo inspection program might prompt
China and other countries that have close ties with North Korea to
decide not to implement the UN resolution, seriously affecting the
effectiveness of the UN resolution.

The UN sanctions resolution requires all its members to inspect
cargo ships with the aim of blocking nuclear- and missile-related
materials from entering North Korea. Japan's special measures
legislation is designed to empower the Japan Coast Guard (JCG) and
customs officers to examine cargos in order to find banned items to
North Korea.

The JCG Law only allows inspections of vessels carrying cargos in
violation of domestic legislation, such as drugs and weapons.
Inspecting civilian goods that could be used for nuclear and missile
development is not allowed under this law. In the event a cargo
inspection must be conducted, the government will have to apply the
Ship Inspection Operations Law after defining the situation as a
neighboring contingency that might result in an armed attack on
Japan if left unaddressed.

The abolition of the cargo inspection bill will limit Japan's
activities to information-gathering and tracking ships by the
Self-Defense Forces, leaving cargo inspections to other countries.

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At a press conference yesterday, Defense Minister Yasukazu Hamada
expressed his regret over the bill's fate, while indicating that
Japan will continue perform its regular duties, such as gathering
information.

12) DPJ Hatoyama indicates approval of port calls, passage of
nuclear-armed U.S. warships

NIKKEI (Page 2) (Full)
July 15, 2009

In a press conference last evening, Democratic Party of Japan (DPJ)
President Yukio Hatoyama indicated that his party would allow U.S.
warships carrying nuclear weapons to make port calls in Japan and
pass through Japanese territorial waters without consulting Japan.
It is said that there was a secret pact to allow the U.S. to bring
nuclear weapons into Japanese territories when the U.S.-Japan
Security Treaty was revised in 1960. Hatoyama said: "Although Japan
has maintained the three nonnuclear principles, I acknowledge that
Japan has taken realistic response measures regarding certain
issues."

Should the contents of the secret pact be acknowledged, it would
infringe on the three nonnuclear principles, including one to
prohibit nuclear weapons from entering Japan.

Asked by reporters last night about whether he intends to review the
three principles if his party takes over the political reins,
Hatoyama said: "I did not say so." But the compatibility of his
remarks might give rise to controversy. Hatoyama said:

"We cannot sidestep a reality we have to face up to. Once we assume
political power, we will fully discuss the issue with the U.S. It
would be most desirable for us to openly keep the three
principles."

Hatoyama emphasized in the press conference: "It is most imperative
for the government to come up with a unified view." Upon saying this
was his personal view, he remarked: "Also bearing North Korean
issues in mind, the government has taken realistic measures. We also
should consider in that direction."

A senior Social Democratic Party member expressed his displeasure
last night, saying: "The three principles are the policy of this
country. President Hatoyama should not make such a statement."

Aso denies existence of secret pact

Asked by reporters at the Prime Minister's Official Residence
yesterday, Prime Minister Taro Aso denied again the existence of a
secret pact to allow the U.S. to bring nuclear weapons into Japan,
saying: "There was not a secret agreement as I have said from
before. I have no intention to examine this issue."

13) FM Nakasone will not reinvestigate "secret agreement"

YOMIURI (Page 4) (Full)
July 15, 2009

Foreign Minister Hirofumi Nakasone criticized the demand by House of
Representatives Foreign Affairs Committee Chairman Taro Kono for the
government to revise its reply that "a secret agreement on bringing

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in nuclear weapons does not exist between Japan and the U.S." at a
news conference on July 14. He said: "I think it is inappropriate
for one individual to demand the revision of the government's reply
on an important issue like this without solid evidence." He
announced that he does not plan to reinvestigate whether such a
secret accord exists since "previous prime ministers and foreign
ministers have said that the secret agreement does not exist. I have
no plans to conduct an investigation."

14) Nippon Keidanren recommends relaxing three arms export
principles to open way for joint development

MAINICHI (Page 4) (Full)
July 15, 2009

Kohei Misawa

The Nippon Keidanren (Japan Business Federation) issued a
recommendation on July 14 seeking the relaxation of the three
principles of arms export in order to enable joint development of
weapons with foreign countries.

The three arms export principles basically ban the export of arms
and related technologies. Meanwhile, with the shipment of F-2
support fighters ending in FY11, production of fighters has peaked
out, and many affiliated businesses are withdrawing from the
market.

Joint international development has become the main trend in the
development of next generation fighters in America and Europe.
Development by one country has become difficult because this process
requires substantial technological innovation and funding. Nippon
Keidanren is seeking a review of the three arms export principles
claiming that the relaxation of these principles will allow Japanese
companies to participate in joint development, and this will
contribute to the reinforcement of Japan's defense capability.

15) Government completes ratification procedures for cluster bomb
ban treaty

MAINICHI (Page 1) (Full)
July 15, 2009

Ken Uzuka; Takayasu Ogura, New York

The Japanese government completed on July 14 the ratification
procedures for the International Convention on Cluster Munitions
(Oslo Treaty) banning the production, possession, and use of cluster
bombs, whose duds often cause civilian casualties. It deposited the
instrument of ratification with the UN headquarters in New York on
the same day. Japan is the 14th country to ratify the treaty after
Norway, Mexico, and other countries and is the second country to do
so among the G-8 nations after Germany. The government has given
emphasis to the prevention of humanitarian damages and worked for
the early ratification of the treaty.

The treaty will take effect about six months after ratification by
30 countries. With Japan and Germany's ratification, the
effectuation of the treaty next year has become quite probable.

This is the second time that Japan has ratified a disarmament treaty
initiated by the concerned countries -- excluding the U.S., Russia,

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and China - and NGOs, after its ratification of the Anti-Personnel
Mine Ban Treaty in 1998. With this, disarmament has taken shape as a
new theme in Japanese diplomacy.

16) F-22 situation in turmoil

SANKEI (Page 9) (Abridged)
July 15, 2009

Takashi Arimoto, Washington

Concerning the issue over continued procurement of the F-22A Raptor,
a state-of-the-art fighter jet model for the U.S. Air Force, Senate
Armed Services Committee Chairman Levin (Democrat) and Sen. McCain
(Republican),a senior member of the committee, presented a bill on
July 13 seeking to discontinue the procurement of F-22s in the 2010
defense authorization bill. McCain, who fought against President
Obama in last year's presidential race, is now acting in concert
with Obama. Meanwhile, many of the Congress members in the Senate
and in the House are calling for F-22 procurement to be continued
for job security and other reasons. McCain, however, is now boosting
his efforts to bring them around. This is an unprecedented
development in the U.S. Congress. In connection with the issue of
F-22 exports to Japan, all eyes will be on how the Senate and the
House will vote in plenary sessions.

Obama has decided to discontinue F-22 procurement. However, the
House Armed Services Committee, following the Senate Armed Services
Committee, also approved a bill in late June that additionally
earmarked 1.75 billion dollars (approx. 161 billion yen) for the
procurement of seven F-22 jets. Levin and McCain voted against the
bill. Obama sent a letter to them to ask for their cooperation,
saying continued procurement will waste the defense budget.

Obama, who is highly popular, is opposed to continuing F-22
procurement. So is McCain. Nevertheless, many of the Senators and
the Representatives are strongly calling for F-22 procurement to be
continued. That is because F-22 production straddles more than 40
states, involving more than 25,000 workers, and has a direct bearing
on employment in their home constituencies.

The F-22 is regarded as the most likely candidate for the Air
Self-Defense Force's follow-on mainstay fighter (FX). The Senate
Armed Services Committee has earmarked spending in the bill for a
feasibility study of F-22 exports. Levin has named Japan as a target
for F-22 exports.

17) Suspension of Diet deliberations to mean scrapping of cargo
inspection, child pornography bills, deferring of key legislations

YOMIURI (Page 4) (Full)
July 15, 2009

With the opposition boycott of Diet deliberations, the Diet
adjourned on July 14, in effect. As the Diet will be dissolved next
week, 17 bills submitted by the government and 91 bills initiated by
Diet members will all be scrapped. Many important bills, including
the special measures law on North Korean cargo inspection, which the
ruling parties had wanted to pass in the current session, and the
amendment to the law banning child prostitution and pornography, on
which the ruling parties and the Democratic Party of Japan (DPJ)
were engaged in revision discussions, will now be deferred.

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The cargo inspection bill was passed by a majority vote of the
Liberal Democratic Party (LDP) and New Komeito in the House of
Representatives in the late afternoon of July 14 and sent to the
House of Councillors. However, the opposition-controlled Upper House
is expected to not even accept the bill.

This bill will be the legal basis for implementing UN Security
Council (UNSC) Resolution 1874 imposing sanctions on North Korea.
While there is an opinion that actual cases of Japan inspecting
cargo on ships traveling to and from North Korea are not likely, the
government is concerned that "the delay in legislation may give rise
to doubts about Japan's previous stance of actively calling for the
passage of the UNSC resolution."

The DPJ had leaned toward approving the bill, but it has abandoned
deliberation on the legislation, giving priority to its
confrontation with the Aso administration. At a news conference on
July 14, President Yukio Hatoyama explained that, "This bill needs
to be passed speedily after the DPJ takes over the administration."

Since the current Diet session is regarded as the last one before
the Lower House election, the ruling parties and the DPJ have
cooperated to a certain degree in steering Diet business. This is
evidenced by the fact that of the 69 new bills submitted by the
government, 62 or 89.9 percent were passed, representing a rise of
23 percent points over last year. The enactment rate has recovered
to the level in 2007 (91.8 percent),when the "twisted Diet" (where
the ruling bloc controls the Lower House, while the opposition
controls the Upper House) came to pass. However, in the final phase
of the Diet session, political maneuvering over dissolution resulted
in stagnation in Diet business.

Time has run out for the deliberation of the amendments to the civil
service law and the Narita International Airport, Inc. law, while
the amendment to the temporary worker placement law, which will lead
to the improvement of working conditions, has not even been
scheduled for deliberation.

Meanwhile, with regard to bills initiated by Diet members, while 19
of them, including the amendment to the organ transplant law carried
over from the previous session, were passed, many of them made no
progress in the deliberation. As to measures to regulate child
pornography, which have been criticized by the international
community for being too lenient, the ruling parties and the DPJ had
been considering banning the downloading and possession of visual
images of child pornography, but the bill was not passed by the
current Diet session. Diet members involved with this bill say that
"it is regrettable that we ran out of time."

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