JAPANESE MORNING PRESS HIGHLIGHTS 03/23/09

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SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03/23/09

Index:

Northeast Asia security:
1) For the first time, a senior Chinese official - defense minister
- calls on North Korea to restrain from launching its missiles
(Sankei)
2) Defense Minister Hamada reveals that in preparation for North
Korea's "satellite" launch, he will issue an order to destroy it if
it heads toward Japan (Asahi)
3) In defense ministers' meeting, Japan and China agree to cooperate
on anti-piracy policy (Nikkei)
4) In defense chiefs' meeting, China admits to Japan it is building
an AIRCRAFT CARRIER (Tokyo Shimbun)
5) China concerned about Japan's interception stance but both
countries agree in defense chiefs' meeting to call on North Korea to
hold back its missile launch (Nikkei)
6) United Nations will not issue a resolution against North Korea if
it launches a missile at Japan, only a statement (Yomiuri)
7) China and Russia are blocking a UNSC resolution with sanctions
against North Korea if that country launches a "satellite" against
Japan (Tokyo Shimbun)

Defense and security affairs:
8) Prime Minister Aso, in speech at defense university graduation,
cites high expectations of the Self-Defense Forces (Sankei)
9) Democratic Party of Japan's Asao says party wants to revise the
anti-piracy bill to give the Japan Coast Guard and not the SDF the
major overseas roll (Tokyo Shimbun)

10) Japan and Russia intend to sign a nuclear cooperation pact
during Prime Minister Putin's May visit to Tokyo (Asahi)

11) Japan planning to use official development assistance to help
domestic companies get a foothold in Iraq (Mainichi)

Political merry-go-round:
12) Poll probes ruling Liberal Democratic Party image: Only 9
PERCENT have confidence in the LDP; 72 PERCENT think it arrogant;
67 PERCENT distrust it (Mainichi)
13) Poll on LDP, DPJ: 60 PERCENT disappointed in the DPJ, but 58
PERCENT still want a change in government, which would mean a shift
from LDP to DPJ rule (Yomiuri)
14) Ozawa's secretary to be indicted tomorrow (Asahi)
15) Even if his aide is indicted for accepting illegal donations,
DPJ President Ozawa likely to stay on as head of the party (Asahi)

16) DPJ's Edano: Ozawa will stay on as party president (Asahi)

17) Finance Minister Yosano hints that the additional stimulus
package now being readied will have over 10 trillion yen in fiscal
outlays (Tokyo Shimbun)

Articles:

1) Chinese Defense minister to call on Pyongyang to restrain missile
launch

SANKEI (Page 2) (Full)
March 21, 2009

Hideki Noguchi, Beijing


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Defense Minister Yasukazu Hamada met on March 20 in Beijing with We
Bang, chairman of the Standing Committee of the National People's
Congress, and with National Defense Minister Liang Guanglie in
succession. Referring to the issue of North Korea's possible launch
of a long-range ballistic missile, Liang said: "It would be best if
(North Korea) did not launch it." This was the first time for a
high-level Chinese official to indicate an intention to call on
North Korea to exercise restraint. Liang also revealed for the first
time China's intention to build an AIRCRAFT carrier. He told Hamada:
"Among the big powers, China is the only country that does not
possess an air craft carrier."

Hamada insisted that if the North launches a missile, it would
violate UN Security Council resolutions, and he sought the Chinese
side's understanding for Japan's position. Wu just said: "Countries
concerned are required to respond appropriately and calmly toward
the issue." He indirectly urged Japan and the United States not to
irritate Pyongyang by intercepting a missile and not to impose
sanctions if Pyongyang launched a missile. Ling also told Hamada: "I
understand Japan's awareness, but I think it is better for your
country to take a calm response."

Regarding the AIRCRAFT CARRIER construction, Liang pointed out:
"There is no such option as never possessing any AIRCRAFT carriers."
He continued: "China has a large ocean area and we have
responsibility for protecting it. Since our naval power is weak, we
should improve it."

Tokyo and Beijing agreed to cooperate as much as possible in sharing
information between Chinese vessels, which have carried out
activities since January, and Japan's Maritime Self-Defense Force's
destroyers regarding anti-piracy measures in waters off Somalia.

2) Missile destruction order to be issued in preparation for North
Korean "satellite" falling on Japan

ASAHI (Page 1) (Abridged slightly)
March 21, 2009

Hisashi Ishimatsu, Beijing

In reaction to North Korea's announcement that it would "launch a
satellite" between April 4 and 8, Defense Minister Yasukazu Hamada
has announced his intention to issue late this month an order to
destroy ballistic missiles and other projectiles under Article 82-2
of the Self-Defense Forces Law in order to be prepared for a failed
launch resulting in a projectile falling in Japan. The article has
never been invoked.

The defense minister is allowed to issue a destruction order in two
cases under the article. One is when a missile or other projectile
is feared to fly to Japan, the defense minister is to issue an order
following a cabinet decision. The other is when a projectile is not
feared fly to Japan, the defense minister is to issue a closed-door
order to be prepared for a sudden turn of events.

Hamada told the press corps on March 20: "The question is which is
more convenient. I think I will make a decision." The government
will hold a meeting possibly early next week of the chief cabinet
secretary, the defense minister, and the foreign minister to make a
final decision.


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But even if an order is issued, Japan is not allowed to intercept a
projectile that flies over Japan, as was informed by the North to an
international organization. Japan is allowed to intercept only when
a launched warhead or booster is projected to fall on Japan's soil
or waters due to a failed launch.

The Defense Ministry will begun shortly considering deploying PAC-3
ground-to-air guided missiles, now deployed at Air Self-Defense
Force bases in the Kanto and Chubu regions, at bases in Akita and
Iwate prefectures where a launched rocket is expected to fly over.
The ministry will also deploy two Aegis destroyers carrying SM-3
sea-based missiles to the Sea of Japan to prepare for the launch.

The government is also considering using the J-ALERT system in order
to instantaneously inform the public of a rocket launch.

3) Japan, China to cooperate in measures against piracy; Defense
authorities of two countries are still guarded toward each other

NIKKEI (Page 2) (Abridged slightly)
March 21, 2009

Ken Sato, Beijing

Defense exchanges between Japan and China have now entered a new
phase, with the defense ministers having agreed in their meeting on
March 20 to cooperate in urging North Korea to practice
self-restraint regarding its planned missile launch. They also
agreed to cooperate in anti-piracy policy. Measures to deal with
piracy will be the first case for Japan's Self-Defense Forces to
work together with the Chinese military. But as seen in the gulf
between the two countries over Japan's missile defense (MD) system,
there is still a deep-seated sense of alarm. No one can foretell if
the planned cooperation will proceed smoothly.

Cooperation in anti-piracy measures is designed to look for ways for
operational cooperation going beyond the realm of joint exercises
for building mutual trust. In China, the military has an immense
clout. The decision to jointly call on the North to practice
self-restraint regarding its missile launch carries great
significance.

As for measures against piracy, Japan and China specifically
envisage cooperation in exchanging information. The ability to
gather information reflects the military's real capability.
Attention will be focused on to what extent the two countries can
share classified information.

China, too, is increasing the performance of a ballistic missile
capable of reaching Japan. In the eye of China, the deployment of
the MD system by Japan and the United States seems to be aimed at
disabling its missiles. This can explain why the Chinese defense
minister applied pressure on the use of the MD system against the
planned North Korean missile launch. Maneuvering between Japan and
China over building up defense capabilities might end up adversely
affecting bilateral cooperation.

4) Liang clearly tells Hamada that China will build AIRCRAFT
carrier; Beijing hopes Pyongyang wil abstain from launching
"satellite"

TOKYO (Page 2) (Abridged slightly)

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March 21, 2009

Norihiro Asada, Beijing

Defense Minister Yasukazu Hamada held talks with his Chinese
counterpart Liang Guanglie in Beijing on March 20. Regarding the
fact that North Korea is preparing to launch a "satellite," which
appears to be a long-range ballistic missile, the Chinese defense
minister expressed China's expectation for the North to exercise
self-control, saying: "It is best that North Korea does not launch a
satellite." At the same time, Liang as the top Chinese defense
official expressed China's intention to possess an AIRCRAFT CARRIER
for the first time to a foreign cabinet minister.

Hamada asked his Chinese counterparty to urge North Korea to
practice self-control regarding the missile launch issue. Liang
replied: "We are well aware of Japan's view. (Relevant countries)
should take calm stances." This was taken as a message to call for
the cautious responses of Japan, the United States and South Korea
which are preparing to intercept an incoming ballistic missile and
to impose additional sanctions on the North.

Regarding the possession of an AIRCRAFT carrier, Liang said: "Our
country has vast oceanic areas, and our country bears a heavy
responsibility to defend them. Among major powers, China is the only
country that does not possess an AIRCRAFT carrier. We cannot remain
as a country without an AIRCRAFT CARRIER forever." Thus, the Chinese
defense minister expressed his country's strong enthusiasm for
building a flattop.

Liang also said about measures against piracy in waters off Somalia:
"We can cooperate with Japan at the administrative level." The two
defense ministers agreed for Japan and China to exchange information
on escorting vessels.

5) Chinese defense minister expresses concern about Japan's policy
of intercepting incoming missile from North Korea

NIKKEI (Page 1) (Excerpts)
March 21, 2009

Ken Sato, Beijing

Defense Minister Yasukazu Hamada arrived in China on March 20 and
held talks with Chinese Defense Minister Liang Guanglie in Beijing.
They confirmed that the two countries should call on North Korea to
refrain from launching what it calls a "satellite." Other countries
believe the North is preparing to launch a long-range ballistic
missile. Liang expressed concern, though with an indirect
expression, about Japan and the U.S. indicating their readiness to
intercept it in the event that North Korea launches a projectile.
Meanwhile, Hamada stressed that Japan will intercept an incoming
missile.

Hamada asked Liang to urge the North to exercise self-restraint. His
counterpart replied: "It would be the best that (North Korea)
refrains from launching a projectile, so it is better for Japan and
other countries to take a cool-headed manner," indicating his
concern over Japan's policy of intercepting a missile flying over
Japan with its missile defense (MD) system. In reaction, Hamada
emphasized: "We will deal with an incoming projectile heading toward
our territorial land, air, and waters."

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6) Japan, U.S., out of consideration to China, start drafting
nonbinding UN chairman statement to prepare against North Korea's
launch of missile

YOMIURI (Page 1) (Full)
March 21, 2009

Yoshikazu Shirakawa, New York

Japan and the U.S. have started making a draft, eyeing a UN Security
Council (UNSC) chairman's statement in the event that North Korea
fires a missile even if Pyongyang calls it a satellite, a UN source
said on March 19. Their move to prepare a nonbinding statement
stems from their consideration to China's revelation that it will
oppose any sanctions and resolution criticizing North Korea.

According to the source, the Chinese ambassador to the UN and other
officials visited the UN representative offices of Japan, the U.S.,
South Korea, and other countries from late last week through this
week and conveyed to them that China would oppose any resolution.
Given that North Korea has announced it would launch a satellite and
has informed the International Maritime Organization of its launch
plan, China reportedly indicated that even if the North fires a
projectile, the launch will not violate the relevant UNSC resolution
that forbids Pyongyang from further nuclear tests or ballistic
missile launches.

Since the U.S has not raised an objection to China's assertion,
Japan and South Korea remain unable to insist on the need for a UN
resolution. In response to China's position, Japan and the U.S. have
started work to draw up a draft, eyeing a chairman's statement
expressing "regret." They are expected to seek China's agreement by
submitting a chairman's statement in the end even if they present a
resolution in UNSC talks.

In 2006, the UNSC adopted a resolution denouncing the North Korean
missile tests, but in 1998, it had just expressed a feeling of
regret in an unofficial press statement directed to the news media.
A chairman's statement is more influential than a press statement,
but it has no legal binding power toward the country concerned and
its member countries, unlike a resolution. North Korea has announced
it would file an experimental communications satellite sometime
between April 4 and 8. The UNSC intends to hold a meeting
immediately after it fires a projectile.

7) Stormy negotiations expected over UN resolution against North
Korea's launch of "satellite"

TOKYO SHIMBUN (Page 2) (Full)
March 23, 2009

The Japanese government has been stepping up efforts to have the
United Nations Security Council (UNSC) to adopt a sanction
resolution in the event North Korea launches a projectile which it
calls a "satellite rocket." Even if it launches a satellite, it is
technically the same as a missile, so the government judges the
launch violates UNSC Resolution 1718. There has been no unanimity of
views among the council members, so stormy negotiations are expected
after Pyongyang fires a projectile.

Foreign Minister Hirofumi Nakasone emphasized: "If (a rocket) flies

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over Japan, we will be in the most danger, so Japan should call on
the international community (to adopt a resolution)."

The Japanese government intends to ask the UNSC chairman to call an
emergency meeting immediately after North Korea's launch is
confirmed. "We will call for the toughest resolution," said a senior
Foreign Ministry official. Japan seems to be aiming to work on other
member countries to adopt a resolution including new sanction
measures with binding power.

Nakasone and senior Foreign Ministry officials, including Vice
Minister Mitoji Yabunaka, have reiterated the need for joint steps
to be taken during meetings with cabinet ministers and bureaucrats
of UNSC member countries and through embassies.

China and Russia, however, stand in the way of adopting a resolution
as veto-holding permanent UNSC members. These two countries opposed
the draft sanction resolution submitted by Japan when Pyongyang
launched ballistic missiles in July 2006, on the grounds that it
would cause trouble. As a result, the UNSC adopted a resolution only
criticizing the North.

This time, too, no agreement has been reached with China and Russia,
according to the senior Foreign Ministry official. Japan intends to
continue to try to persuade them to agree to a resolution. Even so,
it seems difficult to obtain their understanding, given that
Pyongyang has taken the procedures necessary for a satellite launch,
including the prior reporting of the plan to an international
organ.

There is a strong possibility that the UNSC will adopt a resolution
that would urge the North to reconfirm the contents of a relevant
past resolution, or issue a chairman's statement that has weak
binding power or just a statement directed to the news media. A
government source grumbled: "Things do not necessarily move as we
desire at the UN."

8) Expectations for SDF growing: Aso

SANKEI (Page 2) (Full)
March 23, 2009

Prime Minister Taro Aso yesterday attended a graduation ceremony of
the National Defense Academy in Yokosuka, Kanagawa Prefecture,
during which he expressed concerns about North Korea's ongoing
nuclear and ballistic missile development programs. He stated: "In
order for Japan to ensure its peace and security, it is extremely
important to further strengthen its alliance with the United States
and make its own efforts for defense. Expectations for the
Self-Defense Forces are growing even stronger."

The prime minister quoted his grandfather, the late former Prime
Minister Shigeru Yoshida, who stated in a speech he gave at the
academy's first graduation ceremony: "I'd like to ask you all to
carry out your missions from a broader perspective to protect even
the freedom of humanity in the world, rather than from a narrow way
of thinking to protect Japan and its people's interests." Aso also
stated: "Japan's defense and the international community's peace and
stability are inseparable. I'd like to ask you to continue making
efforts for your missions without ever forgetting to have a global
perspective."


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The National Defense Academy had 431 graduates (including 33
females) for fiscal 2008, excluding foreign students. Among them, 35
graduates declined to enter the SDF for such reasons as preferring
to work in the private sector. The figure is the fourth largest
number of graduates ever to decline to serve in the SDF.

9) DPJ's Asao: Japan Coast guard should be mainstay in antipiracy
operations

TOKYO SHIMBUN (Page 2) (Full)
March 23, 2009

Appearing on an NHK TV program aired yesterday, Keiichiro Asao, a
House of Councillors member of the leading opposition Democratic
Party of Japan (Minshuto) and 'defense minister' in his party's
shadow cabinet, suggested the need to amend a government-introduced
antipiracy bill to define the Japan Coast Guard's role even more
clearly as the mainstay to deal with pirates. Asao said: "If the
Japan Coast Guard, which is primarily in charge of antipiracy
activities, finds it difficult to deal with pirates, then the
Self-Defense Forces will be called to move out. We must establish
this way of doing things."

The bill stipulates that the JCG is to deal with piracy in
principle, and the defense minister, with the prime minister's
approval, will order the SDF to embark on antipiracy operations if
there is a special need to do so.

"It's strange that the (substantial) mainstay is the defense
minister," Asao said.

10) Russia forward-looking about signing nuclear agreement with
Japan as early as May

ASAHI (Page 4) (Full)
March 23, 2009

Hideki Soejima, Moscow

Russian Deputy Premier Sobyanin on March 21 indicated an outlook
that Japan and Russia will be able to sign a nuclear cooperation
agreement when Prime Minister Putin visits Japan in May, according
to Interfax. Signing such an agreement is a condition necessary for
Japan to delegate the enrichment of uranium for nuclear power
generation to Russia and for both countries to cooperate with each
other in the nuclear area.

Sergei Kiriyenko, head of Rosatom State Nuclear Power Corporation,
said the same day that the signing of the agreement would push
forward several joint projects. Referring to cooperation between
Atomenergoprom under the wing of Rosatom and Toshiba, Kiriyenko
expressed hopes that the integration of the capabilities of the two
companies is interesting, according to the ItalTass. In talks with
Russia on the signing of the agreement, Japan, the only country on
which nuclear weapons, has made it a condition that Russia takes a
measure guaranteeing that it will not divert Japan's technologies to
military use.

11) Japan to strengthen relations with Iraq: Full-scale ODA, advance
of companies

MAINICHI (Page 2) (Full)

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March 21, 2009

Amid public security in Iraq showing signs of improvement, the
government plans to strengthen relations with the nation through
full-scale official development assistance (ODA) and advance of
private-sector companies.

Japan pledged to provide financial assistance worth roughly 5
billion dollars, the second largest, following that provided by the
U.S., in October 2003, six months after the end of the Iraq War.
However, the pace of the provision of funds has significantly been
delayed due to the deterioration in public security and the chaotic
government administration.

However, the government has determined to proactively extend
assistance, seeing now is the time to extend genuine reconstruction
assistance following the Air Self-Defense Force's pulling out of the
nation in December last year, according to a senior Foreign Ministry
official. The Japan International Cooperation Agency (JICA) is for
the first time planning to set up an office Arbil in northern Iraq.
Three officials entered Iraq in early March. The two countries on
March 17 signed a contract for a large-scale yen loans worth
approximately 36 billion yen for projects to build water-supply and
sewer systems in the Kurdish autonomous area. Repairing or
constructing the infrastructure ravaged by the war, such as water
supply and power supply systems, is of urgent necessity. The
government will extend more yen loans and technical cooperation.

Moves on the private-sector level are also becoming active. Former
Prime Minister Abe visited Baghdad in January this year. He and a
senior Iraqi government official signed a Japan-Iraq partnership
declaration. A government-private sector joint mission consisting of
about 20 executives from the oil industry and trading houses visited
the nation on March 1. An increasing number of companies are now
waiting for business opportunities in Iraq, following the collapse
of the Gulf bubble economy, such as the economy of United Arab
Emirates (UAE),due to the global financial crisis.

Japan had dispatched Self-Defense Forces personnel in support of the
U.S.-led Iraq war. There were no casualties caused by SDF attacks
among civilians. As such, JICA Middle East Second Division chief
Hideki Matsunaga said, "The Iraqi people have a favorable impression
of Japan. It is important to assist the Iraqis over the mid- to
long-term, taking advantage of their pro-Japanese feelings."

12) Online poll: 72 PERCENT see LDP as arrogant, 67 PERCENT
distrustful

MAINICHI (Page 2) (Full)
March 22, 2009

The proportion of those thinking the leading Liberal Democratic
Party is arrogant reached 72 PERCENT in a poll conducted online by
the Mainichi Shimbun with cooperation obtained from NTT Resonant
Inc. The same question was asked in a previous poll taken in May
2006 when the Koizumi cabinet was in office. The figure this time is
up 15 points from that poll. Meanwhile, those distrustful of the LDP
also accounted for 67 PERCENT , a substantial increase of 28 points.
The proportion of those having expectations for the LDP dropped 9
points to 13 PERCENT , and the proportion of those seeing the LDP as
trustworthy also dropped 8 points to 9 PERCENT . The figures clearly
show the deteriorated image of the LDP.

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In the poll, respondents were asked to pick up to three from among
eight words prepared to image the LDP. In response to this question,
women's image of the LDP has gone from bad to worse in particular.
"Distrust" increased 33 points from May 2006 to 69 PERCENT , with
"expectations" decreasing 14 points to 13 PERCENT . The figures are
respectively 22 points higher and 4 points lower than that among
men.

13) Poll: "Disappointed at DPJ" increases to 60 PERCENT

YOMIURI (Page 2) (Full)
March 23, 2009

The voter's image of the leading opposition Democratic Party of
Japan (Minshuto) has now deteriorated, the Yomiuri Shimbun found
from a recent face-to-face public opinion survey conducted in
cooperation with Waseda University. This can be taken as reflecting
a construction company's lawbreaking payoffs to DPJ President
Ozawa's fund-managing body. However, those favoring a change of
government between the ruling and opposition parties still account
for a majority.

The Yomiuri-Waseda joint poll is aimed to probe how public attitudes
toward the ruling Liberal Democratic Party and the DPJ will affect
their voting behavior. The joint poll has been continued since
October last year, and this is the fourth one (taken March 14-15).

In the survey this time, 47 PERCENT answered "yes" when asked if
they had expectations for the DPJ. The figure, however, dropped from
55 PERCENT in the last survey. The proportion of those
"disappointed" at the DPJ increased from 50 PERCENT to 60 PERCENT .
Respondents were also asked if they thought the DPJ have competence
to run the government. To this question, "yes" accounted for 45
PERCENT , down from 51 PERCENT in the last survey. This time, "no"
accounted for a majority at 48 PERCENT .

Respondents were further asked if it would be all right to let the
DPJ runs the government. To this question, however, "yes" was at 58
PERCENT , down from 64 PERCENT but the same as in October last year
(58 PERCENT ). The figure is substantially higher than 39 PERCENT
for "no."

When asked if the LDP is competent enough to run the government, 61
PERCENT answered "yes." The figure increased from 54 PERCENT in
the last survey. In the public impression of the LDP, however, the
proportion of those "disappointed" at the LDP was 73 PERCENT (75
PERCENT in the last survey),remaining high. Those having
expectations for the LDP accounted for 37 PERCENT (36 PERCENT in
the last survey),showing almost no change.

The survey this time was conducted with a total of 3,000 persons
chosen from among the nation's voting population. Answers were
obtained from 1,755 persons (58.5 PERCENT ).

14) Ozawa's secretary to be indicted tomorrow

ASAHI (Page 1) (Full)
March 23, 2009

The special investigation squad of the Tokyo Public Prosecutors
Office has decided to indict Takanori Okubo, 47, the first

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state-funded secretary of Democratic Party of Japan (DPJ) President
Ichiro Ozawa in violation of the Public Funds Control Law tomorrow
when the term of detention expires. However, Okubo reportedly has
been denied the allegation that he as the accountant of Ozawa's
political management organization "Rikuzankai" received illegal
donations from Nishimatsu Construction Co.

The special investigation squad intends not to question Ozawa until
March 24, although it initially had planned to do so. The
prosecutors appear to have judged that hearing from Ozawa was
unnecessary for the time being, since they have gathered necessary
evidence to indict Okubo.

According to the investigations by the special investigative squad,
Okubo allegedly submitted false reports on Rikusankai's political
funds for 2003 - 2006 as if to received totaling 21 million in
donations from Nishimatsu's two political groups headed by former
officials of the construction firm with the knowledge that the
donations came from Nishimatsu.

The Political Funds Control Law prohibits donations under the name
of other person and corporate donations to organizations and
individual politicians other than political parties. The special
investigation squad has judged from such evidence that receipts
Nishimatsu received from Rikuzankai, which former Nishimatsu
President Mikio Kunisawa, 70, and former Nishimatsu administrative
manager Akifumi Okazaki, 67, that Okubo fully recognized that the
indirect donations came from Nishimatsu and the two political bodies
were dummies.

Moreover, it has been learned that Nishimatsu was aware that it
received orders of dam construction in return for its donations to
Ozawa's political management organization. The special investigation
squad pays attention to the wrongfulness of the allegation that
Nishimatsu donated to Rikuzankai to get orders of specific projects.
The prosecutors are investigating focusing on the degree of the
Ozawa side's involvement in the orders Nishimatsu received.

15) Even with the indictment of his secretary, Ozawa most likely to
stay on as head of Democratic Party of Japan, if the charges are not
expanded

ASAHI (Page 1) (Excerpt)
March 22, 2009

In connection with the illegal political donations from the
Nishimatsu Construction Company, Democratic Party of Japan (DPJ)
President Ozawa will most likely stay on in his position, even if
his first public secretary is indicted, as long as the investigation
does not expand to include other charges. This was revealed on March
21 by a party official. Ozawa will hold a press conference on March
24, the day the legal confinement period of his secretary ends, and
state his course of action.

16) DPJ's Edano: Ozawa will stay on as DPJ president if the donation
scandal does not expand

ASAHI (Page 1) (Full)
March 23, 2009

Asked on a TV Asahi program yesterday about how he would respond if
President Ichiro Ozawa decided to remain in his current post even if

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his first state-paid secretary was indicted on a charge of violating
the Political Funds Control Law, Yukio Edano, former policy chief of
the main opposition Democratic Party of Japan (DPJ),stated: "If the
investigation into the scandal does not expand, I think there won't
be a mood in the party to reverse (Ozawa's decision to remain in his
post)." He indicated his view that if no new revelations came to
light in the donation scandal, the DPJ would approve Ozawa's stance
of not quitting his post even if his secretary is indicted.

Edano said: "We should not ask him to quit his post if there is no
significant evidence." Vice President Katsuya Okada said in a speech
delivered yesterday in Yokkaichi City, Mie Prefecture: "There will
be some developments on Tuesday (March 24). I would like to deal
with the matter, keeping in mind accountability."

17) Public spending in additional economic stimulus package likely
to top 10 trillion yen, finance minister hints

TOKYO SHIMBUN (Page 1) (Full)
March 23, 2009/03/23

Referring to public spending as an additional economic stimulus
measure, Finance Minister, State Minister for Financial Services and
State Minister for Economic and Fiscal Policy Kaoru Yosano during a
commercial TV talk show on March 22 hinted at a possibility that the
size of such spending would exceed 10 trillion yen. He said, "This
is not a matter of 2 trillion yen or 3 trillion yen. It is
impossible to deal with what is happening now or what will likely
happen in the future with such a small amoung of spending."

The supply-demand gap, which Nikkei has calculated to show the
difference between supply and demand in the overall domestic
economy, reached approximately 20 trillion yen in the
October-December quarter 2008. The ruling parties and business
leaders are calling for public spending on the scale of 20-30
trillion yen. Yosano responded to such a call, simply noting, "It's
a good figure as guesswork."

Discussions of additional stimulus measures will shift into high
gear after the enactment of the fiscal 2009 budget. The package will
likely focus on public works: making school buildings
earthquake-resistant, and the construction of such key facilities as
ports, harbors and airports. The government wants to make such
projects lead to creation of demand and jobs.

Yosano also indicated a stance of holding discussions on the future
image of Japan in such terms as social security and diplomacy. He
said, "The government must indicate a major direction the state will
follow. We will discuss its contents in early April."

Liberal Democratic Party (LDP) Tax System Research Commission
Chairman Yuji Tsushima appearing on a different commercial TV talk
show took a negative stance toward 20-trillion yen in public
spending, saying, "It is all right to do whatever is effective.
However, it is not right to say that public spending is needed
whenever there is lack of demand."

ZUMWALT