TOKYO MEDIA REACTION - NORTH KOREA AND U.S.-CHINA

UNCLAS TOKYO 001700 SIPDIS STATE FOR I/RF, PA/PR/FPC/W, IIP/G/EA, EAP/PD, R/MR, EAP/J, EAP/P, PM; USTR FOR PUBLIC AFFAIRS OFFICE; TREASURY FOR OASIA/IMI; SECDEF FOR OASD/PA; CP BUTLER OKINAWA FOR AREA FIELD OFFICE; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR E.O. 12958: N/A TAGS: OIIP KMDR KPAO JA SUBJECT: TOKYO MEDIA REACTION - NORTH KOREA AND U.S.-CHINA RELATIONS ¶1. LEAD STORIES: Several national dailies on Monday gave top coverage to the official release today by the DPJ of its policy manifesto for the August 30 general election, in which the party will propose the creation of a "National Strategy Bureau," which would be headed by the prime minister and tasked with compiling a basic outline of annual spending programs and mid- to long-term defense and foreign policies. ¶2. "Call for Dialogue Represents Departure from Hard Line" On recent press remarks by the North Korean ambassador to the UN expressing his country's readiness to hold dialogue with the U.S., the liberal Tokyo Shimbun wrote from Seoul (7/26): "This positive message was directed at the U.S. It signals that the DPRK has temporarily halted its hard-line measures that were launched following the inauguration of the Obama administration and instead is looking for an opportunity to hold negotiations [with Washington].... It is imperative for North Korea to improve its ties with the U.S. in order to ensure the survival of the [Kim] regime.... North Korea has come to the conclusion that preparations for the succession [of Kim Jong Il] are now proceeding smoothly. It is expected that North Korea will use a carrot and stick approach to seeking full-fledged dialogue in order to win concessions from the U.S." ¶3. "Economic Strategic Dialogue to Test Obama Initiative" On the upcoming U.S.-China economic dialogue in Washington, the conservative Sankei stated (7/26): "The meeting will test how the Obama administration, which calls for dialogue [with international players], will deal with China, which is expanding its [international] presence.... Discussions on the economic front will focus on how to ensure the value of dollar-based assets such as Treasury bonds. The U.S., which is keen to overcome the financial crisis, hopes China will continue purchasing Treasury bonds and will ask Beijing to adopt a new growth policy by abandoning its dependence on exports to the U.S. and instead expanding domestic demand. A new framework [for cooperation] will form the foundation for stable U.S.-China relations. While the two nations are both eager to demonstrate their influence, they have significant differences of opinion on the economic and security fronts. Optimism on the outcome of dialogue is not warranted, as many obstacles still need to be overcome." ZUMWALT