JAPANESE MORNING PRESS HIGHLIGHTS 1/29/09

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SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1/29/09

Index:

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

Anti-piracy measures:
4) P-3C patrol planes being considered for dispatch to waters off
Somalia as part of anti-piracy mission (Tokyo Shimbun)
5) Information on pirate movements in waters off Somalia to be
shared among Japan, U.S., EU (Nikkei)
6) Japanese ship owners want their vessels in pirate-infested waters
of the Gulf of Aden to be included under EU military protection, as
well (Mainichi)
7) New Komeito forced to accept MSDF mission to deal with pirates,
giving priority to coalition with LDP, suppressing criticism within
the party (Asahi)
8) Democratic Party of Japan (DPJ) ambivalent on anti-piracy
mission, its members split into pro and con groups (Tokyo Shimbun)

9) In drafting new law for anti-piracy dispatches, major gap emerges
between LDP and New Komeito over criteria for use of weapons (Tokyo
Shimbun)
10) Voices of welcome, concern great news of pending dispatch of
MSDF for anti-piracy mission (Asahi)

Diplomatic agenda:
11) Finally, after more than a dozen tries, there will be a
telephone conversation between Prime Minister Aso, President Obama
(Sankei)
12) Former Prime Minister Abe, now in Baghdad, tells Iraq's
president that Japan will strengthen its economic ties with that
country (Yomiuri)
13) Talks break down over Russian intransigence about removing
entry-card requirement to northern islands, resulting in Japan
halting aid to the territory (Tokyo Shimbun)
14) Main points of Foreign Minister Nakasone's foreign policy speech
in the Diet (Tokyo Shimbun)

15) Prime Minister Aso's Diet speech gets mixed reviews from ruling
and opposition camps (Tokyo Shimbun)

16) Domestic auto production plummets 24 PERCENT in Dec., with
Mitsubishi Motors dropping by 46 PERCENT (Yomiuri)

Articles:

1) TOP HEADLINES

Asahi:
Former company president arrested on suspicion of tax evasion worth
1.7 billion yen

Mainichi:
Government to assist rehabilitation of mentally disabled convicts
after they serve prison terms

Yomiuri:
Health ministry study group develops universal vaccine for flu: Also
effective for new strains of flu

Nikkei:

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Government eyes 30 broadcast channels for mobile phones to be
started in 2011 or later

Sankei:
Prime minister's policy speech: Resolve to create new order; fails
to show next step

Tokyo Shimbun:
MSDF to be dispatched to Somalia: Government also considering
sending P3Cs; Special operation unit to be allowed up to firing
warning shots

Akahata:
Prime minister's policy speech adheres to sales tax hike, dispatch
of troops: No breakthrough in employment problem

2) EDITORIALS

Asahi:
(1) Sharp increase in jobless people: Employ all sorts of employment
measures
(2) Aso speech: Words from prime minister who has lost credit with
people weak

Mainichi:
(1) Prime minister's policy speech: Aso scenario sounds empty
(2) New cash remittance service: Change bank monopoly

Yomiuri:
(1) Prime minister's policy speech: Government should fulfill its
role steadily
(2) Agricultural administration reform: Promote discussion on review
of acreage reduction policy

Nikkei:
(1) Prime minister should come up with initiative to address the
greatest crisis in the century
(2) Preparations for dispatch of MSDF to Somalia have gotten under
way at long last

Sankei:
(1) Prime minister's policy speech: Discuss the form of the state
(2) Dispatch of MSDF to deal with pirates in waters off Somalia:
Suprapartisan effort to enact new law urged

Tokyo Shimbun:
(1) Aso speech: "Along with the people" does not resonate with the
public
(2) Re-regulation on taxies: Do not forget consumer interest

Akahata:
(1) Prime minister's policy speech: Words "peace of mind and
vitality" sound empty

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, January 28

NIKKEI (Page 2) (Full)
January 29, 2009

07:15

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Took a walk around his official residence.

09:30
Attended a meeting of the Security Council at the Kantei. Later, met
Okinawa Governor Nakaima, Okinawa mayors association chairman
Okinaga, Okinawa town and village heads association chairman Miyagi,
with Chief Cabinet Secretary Kawamura, Lower House member Seiji
Nakamura, and others present.

10:34
Met Environment Minister Saito and Vice Minister Nishio.

11:18
Met Foreign Ministry's Ambassador for Okinawa Affairs Imai and North
American Affairs Bureau Director General Umemoto.

12:50
Attended a meeting of lawmakers in the Diet Building.

13:01
Attended a Lower House plenary session.

15:01
Attended an Upper House plenary session.

16:23
Arrived at the Kantei.

17:35
Attended a New Year's party held by the People's Political
Association at the Grand Prince Hotel Akasaka.

18:58
Dined at an Italian restaurant in Ariake with Keio University
President Yuichiro Anzai, Sankei Shimbun Chairman Takehiko Kiyohara
and others.

22:59
Returned to his official residence.

4) P-3C dispatch also considered for antipiracy measures

TOKYO SHIMBUN (Top play) (Abridged)
January 29, 2009

Defense Minister Yasukazu Hamada yesterday ordered the Maritime
Self-Defense Force to prepare for antipiracy deployment to waters
off the eastern African coast of Somalia. The MSDF, according to its
unveiled plan, will dispatch two destroyers, which will be based in
Djibouti, a coastal country facing the Gulf of Aden. The MSDF is
also looking into the possibility of sending three P-3C patrol
planes. A special security force, which will have its rangers
onboard the MSDF destroyers, will fire warning shots at pirate
ships. Hijacked ships, however, will be left to the Japanese
government's negotiations for their release.

The MSDF, in its law-based maritime security operations, is allowed
to protect Japanese ships, including Japan-linked ones. Among them,
there are an annual total of about 2,000 ships passing through the
Gulf of Aden. They will be escorted by two MSDF destroyers. It takes
one and a half days to pass through the 1,200-kilometer-long sealane
extending east and west and including the Gulf of Aden, where

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pirates are rampant. The two MSDF destroyers are expected to convoy
a big fleet of around 10 ships.

If escorted ships are double-lined, it is possible to see all the
ships that are convoyed between the two MSDF destroyers. With the
naked eye, however, it is hard to see small ships like high-speed
boats used by pirates. The destroyers' surface radar will become a
vital eye for piracy surveillance. Antisubmarine helicopters onboard
the destroyers will also make periodical warning flights.

The special security force will embark on the MSDF destroyers. Its
rangers, who are onboard a high-speed boat and a helicopter, will
approach a pirate ship. After warning, they are expected to fire
warning shots at the water surface. They are also allowed to go so
far as to fire on a pirate ship.

In the case of hijacked ships, however, the Japanese government is
to embark on negotiations. That is because using weapons at a
hijacked ship could victimize its crew taken hostage. For another,
it will be difficult to handle pirates even after arresting them.

5) Japan to share info with U.S., other countries on Somalia
offshore pirates

NIKKEI (Page 1) (Abridged)
January 29, 2009

The government has now decided to dispatch the Maritime Self-Defense
Force to waters off the eastern African coast of Somalia for
antipiracy measures. Along with this decision, the government
yesterday began coordinating with the United States, European Union
countries, Russia, and China, which have already been conducting
warning activities there, to share information on pirates. It will
be easy to grasp the moves of pirate ships. In addition, the
government believes that providing Japan's information to other
countries will also lead to international cooperation.

The MSDF's deployment this time is an action for maritime security
policing under the Self-Defense Forces Law. Defense Minister
Yasukazu Hamada yesterday directed the MSDF to prepare for maritime
security operations. The Defense Ministry will send a fact-finding
team to Somalia's neighbors next month. In March, the MSDF is
expected to send out two destroyers with patrol helicopters
onboard.

6) Japan ships under umbrella of EU naval vessels

MAINICHI (Page 3) (Full)
January 29, 2009

"We're in the convoy of EU (European Union) naval ships for now, so
we're feeling small," an official of the Japanese Shipowners'
Association said. The government has now ordered the Maritime
Self-Defense Force to prepare for deployment to waters off the coast
of Somalia for antipiracy measures. This is aimed at answering such
views in Japan, in addition to fulfilling Japan's international
responsibility. "The government is also concerned about the shipping
industry and answered our request," JSA Chairman Hiroyuki Maekawa,
president of Kawasaki Kisen Kaisha, Ltd., said in a party yesterday
evening of shipping business executives, welcoming the government's
order.


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In waters off Somalia, 44 pirate attacks broke out in 2007 and 111
in 2008. As seen from this, the number of pirate attacks has sharply
increased. Since December last year, EU naval forces have been
conducting antipiracy operations codenamed Operation Atalanta, which
is named after a goddess of the hunt in a Greek myth. EU naval
vessels will escort commercial ships passing through the Gulf of
Aden at their request with their online registration with the EU
naval forces of such specific data as their name, gross tonnage, and
crew size.

EU naval vessels are to escort EU-registered ships. However, non-EU
ships also can ask for their escorting. Commercial ships gather at
the eastern or western end of the 'safe corridor' in the gulf. EU
naval vessels convoy commercial ships that are grouped according to
their navigation speed. This could be a model for the MSDF's
escorting.

The Gulf of Aden is an overcrowded area with an annual total of
about 20,000 ships passing through. However, there are about 6-10 EU
naval vessels for escorting them. Some fleets gathering at a
designated point may have to depart unescorted, according to a JSA
official. "I never saw any naval vessel when we were under way over
there," said a Japanese major shipping company's official. The MSDF,
which will deploy two destroyers there, seem to have a limit to its
activities.

7) New Komeito patiently endorses prime minister's plans for sake of
coalition arrangement

ASAHI (Page 4) (Excerpts)
January 29, 2009

Akihiro Yamada

The New Komeito, a party of peace, has easily endorsed a plan to
dispatch the Maritime Self-Defense Force to waters off Somalia. The
party, which is opposed to hiking the consumption tax that would
directly hit the people's livelihood, is taking a wait-and-see
attitude toward (Prime Minister Taro Aso's) plan to raise the sales
tax. With the approach of the next general election, the New Komeito
cannot afford to criticize the prime minister and thus it is just
patiently holding itself back.

In yesterday's press conference, Secretary General Kazuo Kitagawa
explained why his party endorsed the MSDF Somalia mission this way:
"An anti-piracy mission comes under a policing action. It is not
like going to war. It is on a different plane than (missions in)
such countries as Iraq and Afghanistan." The New Komeito has been
serving as a brake in the ruling bloc regarding its security policy.
Late last year, Defense Minister Yasukazu Hamada was ordered by the
prime minister to consider dispatching the SDF. Hamada, who was
cautious about the dispatch, then sought the cooperation of the New
Komeito, saying, "I cannot easily dispatch the MSDF under a maritime
policing clause."

A New Komeito member well-versed in defense policy rejected the
notion of cooperating with Hamada, saying, "Now that the prime
minister has announced his plan to dispatch the SDF, we cannot
prolong the discussion." The same New Komeito lawmaker recently
explained: "We cannot afford to drag the prime minister down."

New Komeito Chief Representative Akihiko Ota made the following

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statement at the Jan. 18 LDP party convention: "It has been 10 years
since the LDP-New Komeito coalition administration was launched. The
relationship between the two parties is now growing into an
extremely mature one. We are going to demonstrate our strength this
year."

The New Komeito has joined efforts with the LDP in three Lower House
elections and three Upper House elections in the past. With an eye
on possible Lower House dissolution in April, the party has begun
making preparations for campaign cooperation. With the next general
election coming up, putting an end to the coalition arrangement with
the LDP is out of question. Given the situation, for the New
Komeito, there is no other option but to continue supporting the Aso
administration. This can explain why the party earlier this year did
not side with the LDP group opposing the planned consumption tax
hike, reversing its stance of late last year.

8) DPJ leadership torn between two conflicting views on Somalia
anti-piracy mission

TOKYO SHMBUN (Page 2) (Abridged slightly)
January 29, 2009

Takayoshi Goto

Discussions in the Democratic Party of Japan (DPJ) on the question
of sending the Self-Defense Force to waters off Somalia for an
anti-piracy mission have made little progress. The party leadership
is torn between those favoring the dispatch and those calling for
joining hands with other opposition parties, such as the Social
Democratic Party (SDP),which opposes the dispatch. Security issues
are a weak spot with the patchwork DPJ. Discontent is simmering
toward the party's leadership, which seems half-hearted about
resolving the issue.

The SDP and the People's New Party have clearly expressed their
opposition to the dispatch, saying that the matter must be dealt
with by the Japan Coast Guard. At the Jan. 18 DPJ party convention,
SDP head Mizuho Fukushima raised her objection before President
Ichiro Ozawa and Secretary General Yukio Hatoyama, saying, "There is
a possibility that armed force might be used."

After the convention, Ozawa also referred to the possible use of the
JCG. Hatoyama, too, expressed cautiousness, saying, "The public
would think, 'Can civilian control be ensured?'" This comes from the
judgment that it is inadvisable for the opposition parties to
demonstrate discord in view of the Diet and the next Lower House
election.

Meanwhile, former DPJ President Seiji Maehara took this view at the
Jan. 27 executive board meeting: "Are the specifics being discussed
among opposition parties? Above all, our party should decide our own
policy firmly."

Ironically, it was the DPJ's Akihisa Nagashima who triggered the
option of dispatching the SDF. Last October, during the previous
extraordinary Diet session, Nagashima proposed dispatching the SDF,
and Prime Minister Taro Aso in response expressed his intention to
consider that option.

Witnessing the divide between the two groups in the party, one DPJ
lawmaker said: "This might end up giving (the ruling bloc) new

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ammunition to attack the DPJ, which always lacks unity when it comes
to security issues."

9) Many tough questions, such as weapons-use criteria, await ruling
bloc project team's discussions of new anti-piracy legislation

TOKYO SHIMBUN (Page 2) (Abridged slightly)
January 29, 2009

Takuji Soka

The Liberal Democratic Party and its coalition partner New Komeito
began discussions yesterday on drafting a new law allowing the
government to dispatch the Self-Defense Force on anti-piracy
missions as necessary. The discussions were timed to coincide with
the government's order to the Maritime Self-Defense Force to prepare
for its anti-piracy mission in waters off Somali. Although the
ruling coalition plans to submit a bill to the Diet in early March,
it faces many tough issues, such as weapons-use criteria.

Five areas of discussion, such as the use of weapons, vessels
subject to protection, and the Diet's role, are likely to become
points at issue in the ruling bloc anti-piracy project team's (PT)
discussions on the envisaged bill.

In escorting vessels, the MSDF, dispatched under an SDF Law maritime
policing clause, is allowed to use weapons only in legitimate
self-defense and emergency evacuation. There are strong calls in the
Defense Ministry and the LDP for relaxed standards under the
envisaged new law.

The New Komeito remains cautious. Secretary General Kazuo Kitagawa
told a press conference: "The objective is not to strike pirate
ships but to show our deterrent capability." Lower House member
Shigeki Sato, too, argued that it was possible to establish a new
law without easing the weapons-use regulations.

The types of vessels subject to protection are also likely to stir
up controversy.

The scope of protection is limited to Japanese-registered ships and
foreign-registered vessels carrying Japanese cargo. The ruling
parties have basically agreed to expand the scope to include
foreign-registered vessels unrelated to Japan with the aim of
playing up Japan's willingness to contribute to the international
community.

There might be a case where a destroyer would attack a pirate ship
in order to rescue another vessel under attack far outside its
control. Such an action might transcend the scope of legitimate
self-defense. It is a tough question closely associated with the
weapons-use rules.

What to do with the Diet's involvement is also a point at issue. In
terms of civilian control, it is desirable to make prior Diet
approval mandatory, but that might serve to delay a dispatch,
depending on circumstances. Conversely, seeking ex post facto
approval might be criticized as slighting the Diet.

Even if new legislation is submitted to the Diet, all efforts might
come to naught if the Lower House is dissolved soon after. Many
obstacles lie in the way before the envisaged new legislation can be

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passed.

10) Planned MSDF anti-piracy mission off Somalia evoking both
welcome and concern

ASAHI (Page 34) (Excerpts)
January 29, 2009

The Maritime Self-Defense Force (MSDF) started preparations
yesterday to dispatch its escort vessels to waters off Somalia,
Africa, to protect Japan-related ships from possible attacks by
pirates. Those in the shipping industry have welcomed the planned
dispatch based on a provision under the Self-Defense Forces Law for
maritime patrol action, but some experts criticize it as "based on a
stretched interpretation (of the policy provision)."

An executive of the Japanese Shipowners' Association, composed of
about 100 companies operating large vessels, has welcomed the order
issued by Defense Minister Hamada, remarking: "We have not asked
(the MSDF) to sink pirate ships but asked it to escort ships to
prevent pirates from approaching them."

About six Japan-related ships pass through the Gulf of Aden on any
day. The ships get through the gulf under the protection of warships
dispatched from the European Union (EU) and other countries, while
taking one and a half or two days. Dokkyo University Professor Isami
Takeda, an expert on piracy, said: "The protection of Japanese ships
is naturally low on foreign militaries' lists of priorities. If SDF
vessels are mobilized, we can feel safe." The professor is
supportive of the dispatch plan, saying: "Piracy is a crime, so
fighting pirates does not fall under 'war'," adding that it would be
desirable for neighboring countries to boost their coast guards and
for major countries to help reconstruct Somalia in the future.

International University of Japan Professor Tomohito Shinoda
commented: "The international community as a body should work to
prevent piracy." But he posed questions about dispatching MSDF
troops under the policing clause, remarking: "Since the provision
allows troops to use weapons (which inflict harm) only for
legitimate self-defense or averting imminent danger, they will have
to engage in the mission with a sense of anxiety. It is necessary to
ease the nation's weapon-use standards (under new legislation)."

Yamaguchi University Professor Atsushi Kouketsu expressed his
concern about the dispatch plan: "The policing clause does not
assume operations in waters far from Japan. The plan is indisputably
based on a stretched interpretation of the provision. That might
become a precedent to allow (the MSDF) to be dispatched anywhere
under the policing clause."

Meanwhile, MSDF Chief of Staff Keiji Akahoshi said in a press
conference yesterday: "We have neither discussed countermeasures
against pirates nor conducted training to that end," stressing
difficulty in dealing with new enemies. A senior MSDF official
indicated that the use of weapons should be avoided as much as
possible, saying: "The key point is to spot pirates at an early
stage and to prevent them from approach a fleet."

11) Aso, Obama to finally hold telephone talks

SANKEI (Page 2) (Full)
January 29, 2009

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The first telephone conversation between Prime Minister Taro Aso and
U.S. President Barack Obama will likely be held on the morning of
Jan. 29. During the call, the two leaders are expected to confirm
their intentions to strengthen the bilateral alliance. Obama has
already concluded his telephone conversations with the leaders of
Western and Middle Eastern countries, putting his call to Aso on the
back-burner. A senior Foreign Ministry official said: "As there are
circumstances such as time differences, what number Japan might be
is meaningless." However, a Liberal Democratic Party (LDP) source
said: "The Obama administration might be making light of Japan."

Aso and Obama held a telephone conversation last November following
Obama's victory in the U.S. presidential election, but they have not
had any conversation since Obama took the oath of office as
President of the United States. During their conversation, Aso is
expected to offer Obama his congratulations and ask him for a summit
meeting at an early date. They will also confirm their intentions to
strengthen cooperation in order to resolve the issues of North
Korea's nuclear program and abductions of Japanese nationals.

Since becoming president, Obama has held telephone talks with four
Middle Eastern country leaders, including Israeli Prime Minister
Olmert, on Jan. 21; with the prime ministers of Britain and Canada
on the 23rd; and with the French president, German chancellor and
Russian president on the 26th. He then on the 27th held telephone
talks with the Australian prime minister, the first leader of the
Asia-Pacific region to hold such talks with Obama.

Japan, which believes that its alliance with the United States is
the cornerstone of its foreign policy, appears to have fallen behind
those countries. Chief Cabinet Secretary Takeo Kawamura, however,
stated at a press conference yesterday:

"I do not worry at all. (Prime Minister Aso) was able to hold a
friendly discussion with President Obama immediately after he won
the presidential race. The President underscored how important in
Asia Japan was."

Kawamura rejected the view of Japan being taken lightly.

Nevertheless, we can't help feeling that "foreign countries see the
Aso administration's weak political situation," a senior Foreign
Ministry official said.

The reality is that there still is no actual prospect for a summit
between Aso and Obama.

12) Former Prime Minister Abe visits Iraq: Agreement reached with
president to strengthen economic ties

YOMIURI (Page 4) (Full)
January 29, 2009

Former Prime Minister Abe on the morning of January 28 (evening of
the same day, Japan time) visited Iraq as a special envoy of Prime
Minister Aso. He met with President Talabani at the presidential
residence in Baghdad. He is the first former Japanese prime minister
to visit Iraq since the collapse of the Hussein administration in
April 2003. The aim of his Iran visit is to convey to that nation
that Japan will continue to attach importance to it even though the
Self-Defense Forces troops have pulled out from assistance

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operations.

During the meeting, Abe said, "Japan would like to strengthen
business ties with Iran, in particular, in the energy field,
including oil." The president responded, "I want to develop Iraq as
an oil-producing country, using Japan's technology."

Abe also conveyed to Talabani the Japanese government's policy of
dispatching an election monitoring team to Iraq's local assembly
elections.

Prior to the meeting, Abe attended a signing ceremony for the
Comprehensive Partnership Building Declaration, which includes
bilateral cooperation in the energy area. The declaration
stipulates: (1) Japanese companies will cooperate for the
consolidation of oil-related social infrastructure (in Iraq),and
Iraq will supply oil and gas to Japan on a stable basis; (2) the
construction of power plants by Japanese companies is to be
promoted; and (3) a joint ministerial-level economic committee is to
be set up. Japan is the third country, following the U.S. and the
EU, to sign such an accord with Iraq. According to the Foreign
Ministry, Iraq is the third largest holder of confirmed crude oil
reserves in the world. As that country's public security stabilizes,
many countries are beginning to take interest in the development of
the energy resources there.

13) Government halts humanitarian aid to Northern Territories over
Russia's demand for submission of disembarkation card by Foreign
Ministry officials; Talks with Russia fall through

TOKYO SHIMBUN (Page 1) (Almost Full)
January 29, 2009

Russia demanded that Japanese government officials on a humanitarian
mission for Russian residents living in the Northern Territories
submit disembarkation cards before arriving on Kunashiri Island. In
this connection, the Foreign Ministry on January 28 announced that
since talks with Russia on that issue failed, Japanese officials
have rejected submitting embarkation cards and will return to Nemuro
Port. Following the incident, the government has decided to cancel
humanitarian assistance for the remainder of fiscal 2008 or through
March.

The Japanese side expressed regret at what happened. The governments
of both countries have agreed to start talks to settle the latest
issue. Chances are that this issue would be brought up at a summit
meeting between President Medvedev and Prime Minister Aso, which
Medvedev proposed to Aso, if realized. There is fear that if Russia
does not change its stance, the visa-free visit programs allowing
Japanese citizens and current Russian residents in the Northern
Territories to visit mutually without passports or visas will be
forced to be suspended.

Foreign Ministry press secretary Kazuo Kodama during a press
briefing on the 28th said that submission of disembarkation cards
would mean that Japan accepts Russia's claim that Kunashiri Island
belongs to Russia. He criticized Russia's approach, noting that it
is beyond comprehension. He, however, stressed that the latest
development should not affect talks on the conclusion of the peace
treaty. According to the spokesman, the Russian side explained that
the amendment to its domestic law in 2006 necessitates submission of
disembarkation cards. It claims that it notified Japan of the matter

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on the 23rd.

14) Gist of speech on foreign policy

TOKYO SHIMBUN (Page 4) (Excerpts)
January 29, 2009

The following is a gist of Foreign Minister Hirofumi Nakasone's
speech on Japan's foreign policy.

(Basic foreign policy)

There are a host of challenges Japan should tackle swiftly,
including the profound global economic crisis, international
terrorism, regional disputes, and climate change. Japan should
present its clear-cut views and take a vigorous and responsible
diplomatic approach to lead the international community.

(Japan-U.S. relations)

The Japan-U.S. alliance is the cornerstone of Japan's diplomacy and
also is imperative to maintaining peace and stability in the
Asia-Pacific region. Japan's frank and specific proposals to the new
administration of President Barack Obama will contribute to further
strengthening the alliance. In order to maintain deterrence and
reduce the burden on Okinawa and other local communities concerned,
the realignment of U.S. forces in Japan should be steadily
implemented.

(Policy toward neighbors)

Cooperation among Japan, China and South Korea is vital to
developing the Asia region. Japan will step up efforts to frequently
exchange views with the two countries. In an effort to build a
strategic mutually-beneficial relationship with China and a mature
partnership with South Korea, Japan will work to establish extensive
cooperative relations with those two countries.

In relations with North Korea, Japan will get down to brass tacks to
bring about an agreement in the six-party talks on a specific regime
to verify the North Korean nuclear development programs, move the
denuclearization process forward, as well as produce results in the
reinvestigation of the whereabouts of the abduction victims in order
to repatriate them. Japan will move ahead with negotiations with
Russia to have the Northern Territories issue reach a final
settlement.

(Cooperation for peace and stability)

Japan will reinforce cooperation with those that share common values
with Japan, including European countries and the North Atlantic
Treaty Organization (NATO). The nation will work on the parties
concerned to perpetuate the ceasefire in the Gaza Strip. Japan will
make efforts to establish a long-term friendly relationship with
Iraq, where the Self-Defense Forces have now completed their
five-year mission. We also will continue to work on Iran in order to
resolve nuclear problem.

(World economy)

Overcoming the financial and economic crisis is an urgent challenge
facing the international community. We will proactively tackle this

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challenge in cooperation with other countries at the second
financial summit and other forums. We will continue efforts to bring
about a settlement of the new round of World Trade Organization
global trade talks (Doha Round) and to promote negotiations on
concluding economic trade partnerships.

(Environment and climate change)

We are determined to display leadership in building an effective
mechanism that will be joined by all major economies in a
responsible manner. Based on the principles of nuclear
nonproliferation and nuclear safety, we will promote nuclear power
cooperation.

(Countermeasures to terrorism and piracy)

In a bid to prevent Afghanistan from becoming a hotbed of terrorism
again, Japan will provide aid in wide-ranging areas, such as
security, economics, and education, as well as boost its assistance,
including the dispatch of civilians to participate in provisional
reconstruction teams. Japan will also provide assistance to Pakistan
to help eradicate terrorism there and stabilize its economy.

Japan is a maritime, trade-oriented country, so ensuring navigation
and maritime safety is essential for our national survival and
prosperity. Rampant hijackings by pirates are a matter of concern.
In view of protecting Japanese lives and property, our urgent task
is to work out anti-piracy measures. We will continue to study new
legislation and create urgent measures.

15) Prime Minister Aso's policy speech so low key, even ruling
parties criticize it

TOKYO SHIMBUN (Page 2) (Abridged slightly)
January 29, 2009

Prime Minister Taro Aso yesterday delivered a policy speech in
plenary sessions of the two houses of the Diet. His policy speech
seemed sluggish, as if he lacked eagerness for his coalition to win
a victory in the next general election for the House of
Representatives, scheduled for the fall. Aso's political momentum
could further slow down.

In his policy speech last September, Aso demanded that the main
opposition Democratic Party of Japan (DPJ) make clear its position
toward such issues as a bill amending the new Antiterrorism Special
Measures Law. With his plan to dissolve the Lower House and call a
snap election in mind, he clarified his stance of confronting the
DPJ, calling out the name of that party twelve times. He showed in
that speech his optimistic views, such as that he had had no doubts
about the Japanese people's potential.

In his policy speech yesterday, however, he made no mention of the
DPJ, using no provocative words.

Aso's policy speech consisted of 8,467 words, the shortest speech
after Prime Minister Zenko Suzuki delivered one even shorter (7,393
words) in 1982. What was noticeable was the reference to hiking the
consumption tax and a shift away from the structural reform policy
propelled by former Prime Minister Junichiro Koizumi. It was a dull
policy speech aimed to please everyone.


TOKYO 00000209 013 OF 013


Aso read almost all the speech from his notes in a straightforward
manner. His speech did not meet any loud applause.

A former Liberal Democratic Party executive member made this
critical comment: "I did not feel any enthusiasm. It was a mixture
of pieces written by bureaucrats. It was just plain dull." A senior
New Komeito member severely criticized it: "Politicians need
freshness and a spirit that gives the public pluck and hope. In that
sense, it was a failure."

After delivering his policy speech, Aso told reporters: "There is no
change in my mind (from the previous speech)."

16) Domestic auto production plummets 24 PERCENT in December
compared to year before, with Mitsubishi Motors dropping 46 PERCENT


YOMIURI (Page 2) (Full)
January 29, 2009

The nation's largest eight automakers yesterday announced their
production and domestic sales results for Dec. 2008. Domestic
production for the eight companies combined was 706,609 vehicles, a
drop of 24 PERCENT (228,327 vehicles),compared to the same month a
year before. The scale of the reduction in production exceeded the
combined production of Honda and Nissan in Dec. 2007 (224,161
units).

Mitsubishi Motors' production dropped by 46.6 PERCENT or almost
half, compared to the same period last year. In addition, Mazda
reduced production by 42.5 PERCENT , Nissan, by 40.9 PERCENT , all
registering record drops. Toyota Motors (including Daihatsu
Industries and Hino Motors) cut production by 21 PERCENT , but this
was the second record drop following November's figure.

Domestic sales for the eight companies dropped 15.4 PERCENT to
281,424 vehicles. Mitsubishi Motors registered a 31.3 PERCENT
reduction in sales, which was worse than the sales of Nissan,
Mitsubishi, and Fuji Heavy Industries (Subaru). Sales by those three
companies dropped over 20 PERCENT , compared to the same period a
year before.

ZUMWALT