JAPANESE MORNING PRESS HIGHLIGHTS 12/17/09

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SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 12/17/09

INDEX:

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

Defense & security:
4) PM Hatoyama shelves his theory on "security alliance without
regular stationing of troops" (Nikkei)
5) Hatoyama says relocation of Futenma facility by 2014 possible
(Yomiuri)
6) LDP's Ishiba slams delay of decision on Futenma (Yomiuri)
7) Government to make decision on PAC3 deployment today (Nikkei)
8) Japan to provide Afghan army 1.2 billion yen in medical support
(Asahi)

Foreign relations:
9) Foreign Minister Okada to visit Russia on Dec. 27 (Nikkei)
10) Japanese, Singaporean defense ministers share importance of
presence of U.S. troops (Yomiuri)
11) Okada asks Xi Jinping for early exchange of document on gas
field development (Sankei)
12) Commentary: PM Hatoyama's security policy remains vague
(Nikkei)

Politics:
13) SDP leader Fukushima meets Okinawa governor to discuss Futenma
relocation (Mainichi)
14) Future "national policy officials" get to work (Tokyo Shimbun)


Space:
15) GX rocket development cancelled (Mainichi)

Opinion:
16) Diet poll: Ruling parties differ on foreign national suffrage
(Yomiuri)

Economy:
17) American Airlines' parent company CEO: "AMR will object if
antitrust immunity is approved for Delta" (Nikkei)
18) Ministry of Economy, Trade and Industry calls for participation
in Pacific Rim FTA (Nikkei)

Articles:

1) TOP HEADLINES

Asahi, Mainichi:
DPJ urges government to keep gasoline tax rate, set income limit for
child allowances

Yomiuri:
DPJ asks government to maintain provisional tax rates with aim of
curbing issuance of government bonds

Nikkei:
Coordination underway between government and ruling coalition to
keep gas tax rate and to set income limit for child allowances

Sankei:
Priority budgetary requests presented to PM Hatoyama; Ozawa destroys

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centralized policy system

Tokyo Shimbun:
Major general contractors' donations to Ozawa increased four-fold to
mend ties, according to person concerned

Akahata:
Demonstration held in Kasumigaseki to seek jobs

2) EDITORIALS

Asahi:
(1) Imperial audience: Political leadership must be demonstrated
properly
(2) Retrial set for Fukawa case: Criminal investigation process must
be completely revealed

Mainichi:
(1) Issue of imperial audience requires rational discussion
(2) Fukawa case: Leave the door wide open for retrials

Yomiuri:
(1) Avoid making hasty decision on special taxation measures in view
of economy
(2) Fukawa case retrial: Confession-oriented investigation repeated

Nikkei:
(1) Do not give up on new climate protocol that includes U.S. and
China
(2) Anxiety over Ozawa-centered petition system

Sankei:
(1) COP summit: Demonstrate determination to leave framework
(2) Legislation essential to join international network to prevent
illegal arms exports to North Korea

Tokyo Shimbun:
(1) Fukawa case retrial: Build solid system to prevent wrong
judgments
(2) Liberalization of aviation industry: Increase competition for
better service

Akahata:
(1) Futenma must be removed: Stop looking for relocation site

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, December 16

NIKKEI (Page 2) (Full)
December 17, 2009

09:54 Arrived at the Prime Minister's Official Residence (Kantei).
12:37 Met Parliamentary Secretary for Environment Otani and Special
Advisor Nakayama.
14:27 Met Cabinet Intelligence Director Mitani.
15:00 Met LDP President Tanigaki, with Chief Cabinet Secretary
Hirano and LDP policy chief Ishiba present.
16:44 Met Deputy Chief Cabinet Secretary Matsui.
17:01 Held discussion with DPJ Secretary General Ozawa and senior
party members on DPJ's requests regarding budget and tax systems,
with relevant ministers present.

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18:09 Met METI Minister Naoshima and Hirano. Naoshima stayed behind.
Met Turkmenistan President Berdimuhamedow.
19:18 Attended signing ceremony and joint press conference. Hosted
dinner party.
20:55 Saw the Turkmenistan president off.
21:00 Met Assistant Deputy Chief Cabinet Secretary Hayashi.
21:40 Arrived at his official residential quarters.

4) PM Hatoyama shelves his theory on "security alliance without
permanent presence of troops"

NIKKEI (Page 1) (Full)
December 17, 2009

Prime Minister Yukio Hatoyama talked about his idea of a "security
alliance without the permanent presence of troops" in relation to
the role of U.S. Forces Japan under the Japan-U.S. security
arrangements on Dec. 16. He said: "Since in reality, I have become
the prime minister, that idea will have to be shelved now." He made
this comment in response to a question from reporters at the Prime
Minister's Official Residence.

During the time of the former Democratic Party of Japan (before its
merger with the Liberal Party in 2003),Hatoyama advocated a
"security alliance without the permanent presence of troops" under
which U.S. troops would not be stationed in Japan in peacetime, and
Japan would only request their mobilization in a contingency.

While indicating that he is shelving this idea, Hatoyama also said:
"I used to subscribe to such an idea, and when you think about
Japan's future for the next 50 or 100 years, it is natural for the
question of whether it is appropriate for foreign troops to remain
to arise."

5) Prime Minister tells LDP's Tanigaki that it will be possible to
relocate Futenma by 2014

YOMIURI (Page 2) (Excerpt)
December 17, 2009

Prime Minister Yukio Hatoyama held talks yesterday with Liberal
Democratic Party President Sadakazu Tanigaki. The Prime Minister
indicated that it will be fully possible to complete the relocation
of the U.S. Marine Corps' Futenma Air Station in Okinawa Prefecture
by 2014, as agreed upon in 2006 between Japan and the United States.
Some people think it will be difficult to meet the goal partly
because the Prime Minister has revealed a plan to look for sites
other than the coastal area of Camp Schwab, which is specified in
the existing plan. The Prime Minister apparently rebutted such a
view.

6) LDP's Ishiba slams PM's decision to postpone Futenma decision as
irresponsible

YOMIURI (Page 2) (Excerpts)
December 17, 2009

In reaction to Prime Minister Yukio Hatoyama's announcement of his
intention to review the Japan-U.S. agreement on the relocation of
the U.S. Marine Corps' Futenma Air Station in Okinawa Prefecture and
to look for new alternative sites, many people, both in Japan and
the United States, expressed their opposition and concerns

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yesterday.

U.S. Marine Corps Commandant Gen. James Conway held a press
conference at the Defense Department on Dec. 15 (Dec. 16, Japan
time) in which he expressed his irritation with Japan's policy
flip-flops. He said: "There have been media reports from Japan and
Okinawa that the minister said such and such, and other people said
such and such. We must give the Japanese government a chance to
reach a logical decision and a formal answer."

Liberal Democratic Party Policy Research Council Chairman Shigeru
Ishiba, too, severely criticized the government's response in a
press conference yesterday, saying: "(The Prime Minister) said that
he has decided not to decide anything - the contents, the relocation
site, or the deadline. This is utterly irresponsible and the policy
is inconsistent. We absolutely cannot accept such a decision."

7) Defense spending policy to be adopted today; limited deployment
of PAC-3 and no increase in SDF personnel specified

NIKKEI (Page 2) (Abridged slightly)
December 17, 2009

The overall draft policy on defense spending for fiscal 2001, which
is expected to be adopted in a cabinet meeting on Dec. 17, was
disclosed yesterday. Reflecting strained Japan-U.S. relations over
the relocation of the U.S. Marine Corps' Futenma Air Station in
Okinawa Prefecture, the draft stipulates that the government will
"consider deepening security cooperation between Japan and the
United States" in connection with security cooperation in the
Asia-Pacific region.

The draft also specifies the limited deployment of Patriot Advanced
Capabiltiy-3 (PAC-3) ground-to-air guided missiles. Additionally the
government will give up on an increase in the number of Self-Defense
Force personnel.

The draft policy was produced because the National Defense Program
Guidelines, the basis for budget-compilation, is scheduled to expire
at the end of this year.

The government has put forward its stance to deeply cut back on
defense spending based on the wishes of the Social Democratic Party,
a coalition partner, and the results of the Government
Revitalization Unit's screening of state projects.

The draft policy also sounds an alarm saying that the North Korean
nuclear and missile issues are becoming serious, while pointing out
the military modernization of neighboring countries and the spurt in
their activities with China in mind.

The gist of the draft basic policy on defense spending

Q The North Korean nuclear and ballistic missile issues are becoming
serious.
Q It is necessary to consider deepening Japan-U.S. cooperation in
security.
Q The nation's defense capabilities must be improved based on the
thinking of the National Defense Program Guidelines.
Q It is essential to improve equipment that is necessary to deal
with a ballistic missile attack, a commando raid, and situations on
outlying islands; to maintain precautionary and surveillance

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activities and collect information at all times; and to deal with
major/exceptional disasters.
Q Equipment that can be used in international peace cooperation
activities must be improved.
Q Anti-ballistic missile capabilities must be improved.

8) Government to extend 1.2 billion yen in medical assistance to
Afghan armed forces

ASAHI (Page 4) (Excerpts)
December 17, 2009

The cabinet of Prime Minister Yukio Hatoyama has decided to provide
the armed forces of Afghanistan with 1.2 billion yen as new aid
measures for security in Afghanistan. Of the 50 billion yen in
Afghan support measures included in the second supplementary budget
for fiscal 2009, which was approved on Dec. 15 by the cabinet, 18.5
billion yen will be appropriated to police assistance. The Hatoyama
cabinet has given priority to assistance for security in
Afghanistan.

The government will provide support for the Afghan armed forces
through a North Atlantic Treaty Organization (NATO) fund. Since this
NATO fund allows the donor to designate the use of the money
donated, the government will limit the use of its donation to the
purchase of medical equipment and supplies, as well as medicines.

9) Foreign Minister Okada to visit Russia on Dec. 27

NIKKEI (Page 2) (Full)
December 17, 2009

Foreign Minister Katsuya Okada has decided to visit Russia on Dec.
27 for a three-day stay. This will be the foreign minister's first
trip to Russia. He is expected to attend the first meeting of the
regular bilateral foreign ministerial on the issue of the Northern
Territories. Prime Minister Yukio Hatoyama and President Dmitry
Medvedev agreed in September to hold regular foreign ministerial
meetings on the issue. The purpose of his visit to Russia is to seek
a breakthrough in the deadlocked territorial issue through talks
with Foreign Minister Sergey Lavrov.

The two foreign ministers will exchange views on the details of
Russia's proposed "creative approaches" for the dispute over the
Russia-held islands off Hokkaido. Okada also aims to deepen mutual
trust by launching discussions with Lavrov.

10) Japanese, Singaporean defense ministers agree on importance of
presence of U.S. troops

YOMIURI (Page 4) (Full)
December 17, 2009

Defense Minister Toshimi Kitazawa met with his Singaporean
counterpart Teo Chee Hean, who also serves as deputy prime minister,
at the Defense Ministry yesterday. In the meeting, Kitazawa said:
"The Japan-U.S. alliance is the cornerstone of Japan's foreign and
defense policies." Teo replied: "Singapore has allowed the U.S.
military to use our facilities and its fighters, warships, and
aircraft to make stopovers in its territory," stressing the
importance of its relations with the U.S.


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11) Okada calls on Chinese vice president for early negotiations to
draw up official document on joint development of gas fields

SANKEI (Page 3) (Excerpt)
December 17, 2009

Foreign Minister Katsuya Okada met with visiting Chinese Vice
President Xi Jinping at a Tokyo hotel yesterday. In the meeting,
Okada called on Xi to start negotiations at an early date to draw up
an official document on the planned joint development of gas fields
in the East China Sea, saying: "It is essential that we translate
the agreement reached last year into action. We should push ahead
with negotiations, as confirmed by our nations' leaders." In
response, Xi simply said: "We would like to maintain the agreement
and continue working-level talks."

12) Commentary: PM Hatoyama's security policy remains vague

NIKKEI (Page 2) (Full)
December 17, 2009

Eiji Sakamoto, editorial staff member

How does Prime Minister Yukio Hatoyama intend to restructure the
Japan-U.S. alliance relationship? Even if one listens carefully to
his statements on the issue of the relocation of the U.S. forces'
Futenma Air Station and on his shelving of the concept of a
"security alliance without the regular stationing of troops," it
remains unclear what he is aiming at.

It is believed that his remarks on Dec. 16 were meant to dispel U.S.
concerns that the Hatoyama administration is moving toward reviewing
the Japan-U.S. alliance. Yet they can also be taken to mean that he
is shelving the concept temporarily and has no intention to change
his position.

The true intent of many of Hatoyama's statements on security policy,
not only on this occasion, is often unclear. Is he changing his
policy or is he merely explaining the situation? The "frivolity" of
his words has caused serious repercussions both at home and abroad.

How to deal with North Korea's development of nuclear arms and
China's military expansion are real issues facing politicians. If
Hatoyama wants to relocate the Futenma base overseas or stick to his
idea of a "security alliance without the regular stationing of
troops," an explanation on the strategy to make up for the
deterioration of deterrence will be necessary.

It is a matter of course that there will be renewed debate on
security policy in response to changes in the international
situation. However, the Prime Minister's imprudent behavior is
exposing the Japan-U.S. alliance to risks pointlessly.

13) SDP leader Fukushima meets Okinawa governor to discuss Futenma
relocation

MAINICHI (Page 5) (Full)
December 17, 2009

Social Democratic Party (SDP) leader Mizuho Fukushima visited
Okinawa on Dec. 16 and met Governor Hirokazu Nakaima at the Okinawa
Prefectural Government building. Fukushima said: "We can strive

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together for the relocation of Futenma (Air Station) out of Okinawa
or out of Japan." Nakaima replied: "I have also been saying that
relocation out of Okinawa is the best option."

After the meeting, Fukushima toured Henoko in Nago City, where the
coastal area of Camp Schwab, which has been chosen as the Futenma
relocation site under the existing plan, is located.

14) Future "national policy officials" start working

TOKYO SHIMBUN (Page 2) (Full)
December 17, 2009

Naoto Kan, deputy prime minister and state minister for national
strategy, yesterday assembled Democratic Party of Japan (DPJ)
lawmakers who have joined the National Policy Unit at the Diet
building, and asked them for cooperation in drafting growth
strategies. After bills related to upgrading the unit to a "bureau"
are passed during the next regular Diet session, he explained to
them that lawmakers who applied to take part in the unit would be
treated as "national policy officials."

Seven DPJ House of Representatives members - Hideo Kataoka, Mitsu
Shimojo, Kaname Shimada, Yoshio Tezuka, Kazue Fujita, and Takahiro
Kuroiwa - have joined the National Policy Unit. They will be in
charge of hearing the views of experts and various government
agencies, and drafting the framework for growth strategies to be
formulated before the end of the year.

Kan offered words of encouragement to the members, saying, "We will
explain what the Hatoyama cabinet has been working on and gain
understanding from the public. I think we have a number of members
who are skilled at formulating these kinds of strategies."

15) Gov't calls off GX rocket development

MAINICHI (Page 2) (Abridged)
December 17, 2009

The government decided yesterday in a meeting of the Strategic
Headquarters for Space Development (SHSD) to discontinue its joint
project with the private sector of developing a midsize launching
vehicle called "GX." This GX rocket development project has been
called into question due in part to its growing cost. The GX cannot
be expected to receive orders for satellite business and purposes,
according to SHSD officials. Meanwhile, the government will continue
to develop a new type of liquefied natural gas engine for the GX.

16) Diet poll: Ruling parties differ on suffrage for foreign
nationals

YOMIURI (Page 4) (Full)
December 17, 2009

The ruling Democratic Party of Japan's policies incorporated in its
manifesto, a collection of public pledges for this summer's House of
Representatives election, enjoy high support among its lawmakers on
the whole, according to a recent parliamentary survey of all Diet
members. Among DPJ lawmakers who responded to the survey, 76 PERCENT
approved of making the nation's expressways toll free and 74
PERCENT approved of pushing for a free trade agreement with the
United States.

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The DPJ manifesto did not include any mention of vesting foreign
nationals, who have permanent resident status in Japan, with the
right to vote in local elections. Concerning this issue of giving
local suffrage to foreign national residents, however, DPJ Secretary
General Ozawa has indicated his intention to present relevant
legislative measures to the Diet during next year's ordinary session
for enactment. In the survey, the polled lawmakers were asked if
they approve of vesting foreign national residents with the voting
right. Among DPJ respondents, 50 PERCENT answered "yes" to the
question, with 23 PERCENT saying they "can't say which" and 25
PERCENT saying "no." This situation in the DPJ appears to be one of
the reasons why the DPJ did not mention local suffrage in its
manifesto.

In the case of the Social Democratic Party, all of those who
responded to the survey answered "yes" to the question. However, 60
PERCENT of those respondents from the People's New Party said "no."
As seen from these figures, the ruling parties cannot be said to be
monolithic. Among the opposition parties, 86 PERCENT of respondents
from the Liberal Democratic Party were opposed to suffrage for
foreign nationals. However, 92 PERCENT of the New Komeito's
respondents and all of the Japanese Communist Party's respondents
said "yes."

17) American Airlines' parent company CEO: "AMR will object if
antitrust immunity is approved for Delta"

NIKKEI (Page 11) (Excerpts)
December 17, 2009

AMR Corp. (AMR) Chief Executive Officer (CEO) Gerard Arpey held a
press conference in Tokyo yesterday and emphasized: "We will support
the reconstruction effort of Japan Airlines Corp. (JAL) through our
oneworld alliance." AMR is the parent company of American Airlines,
which is stepping up efforts to expand its partnership with
embattled JAL. Arpey said that AMR would "forcefully object" if JAL
and Delta Air Lines formed a partnership and applied for antitrust
immunity (ATI).

Prior to the press conference, Arpey met with Land, Infrastructure,
Transport and Tourism Minister Seiji Maehara. Maehara said regarding
which company should be JAL's partner: "That is what JAL, a private
firm, should decide." But he added: "We are interested in which
group JA will choose," indicating that the ministry would be
indirectly involved in the selection process.

18) METI set to specify in economic growth strategy goal of joining
Trans-Pacific partnership agreement

NIKKEI (Page 5) (Excerpts)
December 17, 2009

The Ministry of Economy, Trade and Industry (METI) has started
coordination to incorporate in the government's economic growth
strategy the goal of joining a free trade agreement (FTA) signed
between countries in the Pacific Rim region. Based on the judgment
that it is an influential framework for Japan to deepen economic
ties with other Asian countries, the ministry aims to join the
agreement to pave the way for establishing a free trade zone
covering all Asia-Pacific Economic Cooperation (APEC) forum member
countries in the future.

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The framework METI is aiming to join is the Trans-Pacific Strategic
Economic Partnership Agreement (TPP) signed between Singapore,
Brunei, Chile and New Zealand (in 2005). The U.S. and Australia have
expressed their willingness to join it. Observers have pointed out
that TPP may become the core of the envisioned free trade zone in
the Asia-Pacific region, but the Japanese government has so far
indicated that it would be difficult to participate in TPP.

ROOS