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UNCLAS SECTION 01 OF 08 TOKYO 000618 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR E, P, EB, EAP/J, EAP/P, EAP/PD, PA 
WHITE HOUSE/NSC/NEC; JUSTICE FOR STU CHEMTOB IN ANTI-TRUST 
DIVISION; TREASURY/OASIA/IMI/JAPAN; DEPT PASS USTR/PUBLIC AFFAIRS 
OFFICE; SECDEF FOR JCS-J-5/JAPAN, 
DASD/ISA/EAPR/JAPAN; DEPT PASS ELECTRONICALLY TO USDA 
FAS/ITP FOR SCHROETER; PACOM HONOLULU FOR PUBLIC DIPLOMACY 
ADVISOR; CINCPAC FLT/PA/ COMNAVFORJAPAN/PA. 
 
E.O. 12958: N/A 
TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA
SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 02/03/06 
 
 
TOKYO 00000618  001.2 OF 008 
 
 
INDEX: 
 
(1)  USDA inspectors found no record of removal of risk materials 
from beef to prevent BSE in three-fourths of audited facilities, 
underscoring slipshod compliance with procedures 
 
(2)  LDP leadership losing influence due to Livedoor scandal, US 
beef import issue, Bid-rigging involving DFAA, quake-resistance 
data scam; LDP's factions critical of hasty approval of revision 
of Imperial House Law, New Komeito reluctant again to approve 
proposal of upgrading Defense Agency to ministry status 
 
(3)  Editorial: Reform of TSE; Measures urged to prevent stock 
market from becoming a "casino" 
 
(4)  Koizumi diplomacy-light and shadow: Japan, US, China locked 
with instability (Part 4): Japan lobby straying off into Africa 
for UNSC seat, forestalled in its UN strategy 
 
(5)  Iraq as viewed through the eyes of journalist Mika Yamamoto: 
People crave more security and freedom, suppressing anti-US 
feelings; Longer SDF mission being sought 
 
ARTICLES: 
 
(1)  USDA inspectors found no record of removal of risk materials 
from beef to prevent BSE in three-fourths of audited facilities, 
underscoring slipshod compliance with procedures 
 
YOMIURI (Page 1) (Full) 
Evening, February 3, 2006 
 
By Eiji Hirose in Washington 
 
The Office of Inspector General of the US Department of 
Agriculture on Feb. 2 released an internal auditing report on 
compliance with BSE preventative measures inside the United 
States. Of the 12 meat processing facilities audited, nine or 
three-fourths were found to have no records of whether BSE- 
related specified risk materials, such as cow brains, had been 
removed, underscoring once more the sloppiness of the inspection 
system. 
 
In addition, there were no records of how frequently USDA 
inspectors sent to the facilities had carried out inspections, 
which the report pointed out "made it impossible to judge" 
whether inspections were proper or not. 
 
In January, an inspector at a processing plant in New York City 
who was unaware of Japan's import criteria allowed beef with 
backbones to be shipped in violation of the conditions, resulting 
in a second ban on US beef imports into Japan. The USDA auditors 
report has proved that irresponsible inspection is systemic and 
the New York case was not an exception. 
 
(2)  LDP leadership losing influence due to Livedoor scandal, US 
beef import issue, Bid-rigging involving DFAA, quake-resistance 
data scam; LDP's factions critical of hasty approval of revision 
of Imperial House Law, New Komeito reluctant again to approve 
proposal of upgrading Defense Agency to ministry status 
 
NIHON KEIZAI (Page 2) (Full) 
February 3, 2006 
 
TOKYO 00000618  002 OF 008 
 
 
 
Although the government and ruling Liberal Democratic Party (LDP) 
aim to pass important bills, including a bill revising the 
Imperial House Law and another upgrading the Defense Agency to 
the status of a ministry, it now remains uncertain whether they 
will be able to pass either of those bills during the current 
Diet session. The reasons are that the opposition camp has gained 
greater strength, having as its weapons a set of four issues, 
including the Livedoor scandal and a bid-rigging involving the 
Defense Facilities Administration Agency (DFAA), that it is using 
to attack the government and ruling camp. In addition, the 
political dynamics in the LDP has changed suddenly. Criticism of 
the party executive, which had been contained since the LDP won a 
landslide victory in last year's House of Representatives 
election, has now begun erupting in the party. The party 
executives intend to respectfully carry out coordination, but 
they are having a hard time coping with the criticism. 
 
A dozen or so LDP lawmakers, including Hakubun Shimomura, called 
on General Council Chairman Fumio Kyuma at party headquarters 
yesterday afternoon and urged him to be cautious about submitting 
the bill to revised the Imperial House Law to the Diet. They told 
Kyuma, "We want the party to be careful about a submission of the 
bill revising the Imperial House Law." 
 
Kyuma then revealed that the party would aim at a soft-landing, 
saying, "I think we need to reach an agreement on the matter so 
as not to create bitter feelings." Shimomura, however, said to 
reporters, "There is a possibility that if nothing is done, the 
Lower House may be dissolved." 
 
Yoshiro Mori, chairman of the Mori faction to which Shimomura 
belongs, urged his faction members in a meeting at noon yesterday 
to refrain from engaging in activities that are critical of the 
leadership, but soon after, Shimomura stood up in rebellion to 
the leadership. 
 
There was a view common to the Ibuki and Komura factions favoring 
caution regarding the revision of the Imperial House Law, which 
is designed to allow females and their descendents to ascend to 
the Chrysanthemum Throne. The Japan Conference, a suprapartisan 
group of Diet members chaired by Takeo Hiranuma, has collected 
signatures from 135 LDP lawmakers as of Feb. 1. on a document 
seeking prudence on revising the Imperial House Law 
 
New Lower House members of the LDP dubbed "Koizumi's children" 
are no exception. A group of 15 newcomers, including Masaaki 
Akachi, decided yesterday to hand over a document with their 
signatures to Prime Minister Koizumi calling for "cautious 
handling" of the amendment bill. 
 
Koizumi underscored yesterday his intention to submit the bill to 
the ongoing Diet session, telling reporters, "If debate on the 
bill is conducted, I'm sure that the measure will be approved." 
The LDP executives appear to be alert to criticism in the party, 
one member noting, "It is problem that the mood has been created 
that it is allowable to openly criticize the prime minister." 
 
Such a mood is now spreading in the New Komeito, as well. 
Propelled out by the bid-rigging scandal involving the DFAA, a 
cautious view on a proposal of upgrading the Defense Agency to 
ministry status is growing again in the New Komeito. One member 
said: "Until the end of last year, when we opposed any LDP 
 
TOKYO 00000618  003 OF 008 
 
 
policy, we were labeled 'forces of resistance.' But we now don't 
need to worry about it." 
 
Regarding a revision of the Basic Education Law, on which the LDP 
and New Komeito have been at odds, the LDP is now being forced to 
handle the matter carefully. A study panel of the ruling bloc 
resumed discussion on the revision of the education law on Feb. 1 
for the first time in six months, but the LDP did not come up 
with a more penetrating stance, with one member remarking, "It is 
good that a consensus will be reached before the end of the 
current session. 
 
The LDP has insisted that the word "patriotism" be incorporated 
in its principles on education, but the New Komeito has been 
reluctant to do so. Therefore, an in-depth debate has yet to be 
carried out in the ruling camp. The LDP would like to submit a 
bill revising the basic education law to the Diet without 
irritating the New Komeito. Some party members are worried, 
though, that time is running out. 
 
(3)  Editorial: Reform of TSE; Measures urged to prevent stock 
market from becoming a "casino" 
 
MAINICHI (Page 5) (Full) 
February 1, 2006 
 
Two weeks have passed since a fraudulent accounting scandal 
involving Livedoor Co. shocked the nation. In response to the 
news of raids on Livedoor offices made by the special 
investigation unit of the Tokyo District Public Prosecutors 
Office, the key Nikkei Stock Average nosedived, but since then, 
the market has rapidly rebounded, with the average now exceeding 
the highs recorded before the Livedoor shock. However, 
aftershocks from the scandal still persist in the Tokyo Stock 
Exchange (TSE). 
 
As a result of stock splits, Livedoor issued one billion shares. 
In addition, its minimum trading unit is just one share, so 
investors can participate in the stock market with only 100 yen 
or so. 
 
Livedoor's stock has become the target of a money game. Buy and 
sell orders have poured into the Internet business operation, the 
company's aim being to boost profit margins over a very short 
period. In order to prevent another computer system crunch due to 
such heavy transactions, the TSE now only allows investors to 
trade Livedoor shares for only an hour a day. 
 
Last year, a computer system problem forced the TSE to suspend 
trading twice. Taking responsibility for the incidents, the 
former president resigned, and Taizo Nishimuro now serves as 
president, in addition to holding the chairmanship. Just after he 
began to make efforts to improve the computer system, the 
Livedoor shock took place, throwing the market into confusion 
again on Jan. 18. 
 
As part of efforts to deal with computer glitches, the TSE has 
set up a new post of chief information officer (CIO). On Jan. 30, 
it began to operate a new system for the settlement of trade 
accounts in order to boost the capacity of its computerized 
trading system to deal with 7 to 8 million transactions a day by 
the end of the year. 
 
 
TOKYO 00000618  004 OF 008 
 
 
The boost of TSE capability is not enough, though. The number of 
individual investors is increasing, and about 3 million persons 
reportedly are now engaged in securities trading on the Internet. 
It is also expected that an increasing number of individuals will 
engage in securities trading by using a computer program designed 
to judge market moves and automatically buy and sell shares. In 
such a case, the volume of transactions will increase even faster 
than now. 
 
Of course, it is not correct to say that all Internet-based 
investors have carried out transactions in small volumes of 
shares at frequent intervals. 
 
Although the numbers of individual investors and transactions are 
significantly increasing, individuals' shareholding ratio stays 
at a 20 PERCENT  level - almost the same as that of 20 years ago. 
 
In an effort to direct savings into the investment market, the 
government took measures to lower commissions through intensified 
competition among securities companies and also to enable 
investors to buy shares even with small amounts of money due to 
stock splits. In actuality, though, the shareholding ratio of 
individual investors has not remarkably increased. Rather, the 
stock market has been somewhat at a deadlock. 
 
The growth of liquidity is a favorable condition to energize the 
stock market. But with that aspect alone, transactions on the 
Internet will inevitably become more similar to casino games in 
nature. 
 
It is necessary for the TSE to make efforts not to cause trading 
rush hours, in addition to strengthening the computer system. The 
Financial Services Agency is reportedly planning to set up an 
expert council to work out TSE-reform plans, but it should also 
look into the possibility of restricting share splits once again, 
introducing a charging system in line with the volume of 
transactions, and creating a system to deal with orders outside 
the market. 
 
(4)  Koizumi diplomacy-light and shadow: Japan, US, China locked 
with instability (Part 4): Japan lobby straying off into Africa 
for UNSC seat, forestalled in its UN strategy 
 
MAINICHI (Page 2) (Full) 
February 2, 2006 
 
On Jan. 23, when Japan was in an uproar over the arrest of 
Livedoor Co.'s president, the African Union (AU), consisting of 
53 nations, held a summit meeting of leaders in Khartoum, the 
capital of the Sudan in the northern part of Africa. 
 
Those AU leaders met in a new building that faces the Nile. The 
building, named Friendship Hall, was erected last year with 
China's grant aid. It is a magnificent international conference 
hall with guesthouse functions, and its electrical equipment, 
such as lighting, was also installed by the hands of Chinese 
engineers. In the pressroom were about 50 personal computers 
presented by China. The PCs there could handle Arabic and Chinese 
characters, as well as the English alphabet. There were five 
reporters from Xinhua, the Chinese state news agency. They were 
bustling in and out. 
 
Pro-Japan Nigerian President Obasanjo, who presided over the AU 
 
TOKYO 00000618  005 OF 008 
 
 
from 2004, has stepped down. At the AU summit, Congo Republic 
President Sassou-Nguesso was elected to fill Obasanjo's shoes in 
the AU. Sudanese President Al-Bashir, whose country hosted the AU 
summit, was also elected to chair the AU next year on condition 
that the Sudan improves the human rights situation in Darfur in 
the west of the country. All eyes in the world are on the 
oppression there. 
 
The United Nations is made up of 191 members, and nearly a third 
of them are AU nations. The AU will therefore affect the fate of 
UN Security Council (UNSC) reform. One Japanese ambassador posted 
in Africa has paid close attention to the AU summit. "When the AU 
was under Obasanjo, we could work together with the AU to reform 
the UNSC," the envoy said. He added, "But we can no longer expect 
to do so." 
 
In 2004, Japan's official development assistance (ODA) to Africa 
totaled approximately 75 billion yen, and China's aid amounted to 
about 85 billion yen around the world. However, China employs its 
own materials and workers for its ODA projects. Accordingly, the 
facts about China's foreign aid do not appear in statistical 
figures. China is also moving into countries that suppress human 
rights or are suspected of sponsoring terrorism, while the United 
States and Japan stay away from these regions. Xinhua has 
branched out into a total of 17 countries in Africa. When it 
comes to the Japanese media, Kyodo News has set up the largest 
number of branches in Africa. However, even Kyodo has just three 
branches In Africa, and the Mainichi Shimbun has two. 
 
In his policy speech before the Diet in January last year, Prime 
Minister Junichiro Koizumi stressed Japan's bid for a permanent 
seat on the UNSC. In his parliamentary address this year, 
however, he did not refer to the matter. In July last year, Japan 
formed the Group of Four (G-4) with Germany, India, and Brazil. 
The G-4 moved a resolution to the United Nations for UNSC seats, 
but the resolution failed. Koizumi's failure to mention the 
matter this year is only natural. 
 
The Japanese government, already spending a huge amount of money 
on ODA to Africa for years, expected the AU to support Japan's 
position. Tokyo downplayed China's move to block Japan's UNSC 
ambitions. Japan and China have now changed places with regard to 
their influence in Africa. On Aug. 4 last year, the AU held an ad 
hoc meeting of leaders in Ethiopia. Zimbabwe President Mugabe 
suddenly pounded the table and shouted: "We should not compromise 
with the G-4!" The AU leaders met to consolidate UNSC reform 
resolutions separately prepared by the G-4 and the AU. "His 
remark changed the tide," an AU source said. Many diplomats there 
perceived that it was a "calculated performance" intended to 
speak for China. Right before that, Mugabe visited China and 
inked an economic cooperation document with Chinese President Hu 
Jintao. 
 
"We were taken in by China's maneuvering of the AU without any 
clear-cut action in response." With this, one experienced 
Japanese diplomat owned up to China's move. 
 
Tokyo also misread Washington's bottom line. After the G-4's 
proposal failed, Japan tried to look into the United States' 
negative position about expanding the UNSC lineup. Japan then 
presented the United States with the idea of limited UNSC 
expansion and looked for a compromise with the United States. On 
Jan. 31, however, US Ambassador to the United Nations Bolton 
 
TOKYO 00000618  006 OF 008 
 
 
flatly rejected the idea when he was asked by reporters in New 
York about the matter. "Japan has not come up with any proposal 
that can win broad agreement," he said. 
 
In a September 2004 session of the UN General Assembly, Koizumi 
stressed his desire for a UNSC seat. He now appears to be 
disinterested in UNSC reform, and Foreign Ministry bureaucrats 
are losing their confidence. Japan's UN diplomacy has now lost 
its way and is straying off course. 
 
(5)  Iraq as viewed through the eyes of journalist Mika Yamamoto: 
People crave more security and freedom, suppressing anti-US 
feelings; Longer SDF mission being sought 
 
TOKYO SHIMBUN (Pages 24, 25) (Abridged) 
February 3, 2006 
 
About three years have passed since the United States attacked 
Iraq in the name of "War on Terrorism" based on the allegation 
that the country possessed weapons of mass destruction. Although 
a legislative election took place in December, there seems to be 
no end to violent attacks by armed insurgents in Iraq. Mika 
Yamamoto, 38, of Japan Press sat with the Tokyo Shimbun's Yoichi 
Takenaka to discuss the latest situation in Iraq. 
 
Yamamoto stayed in Baghdad and Samawah, where Self-Defense Force 
troops are stationed, from Dec. 22 through Jan. 16. It was her 
seventh trip to Iraq. The security situation has changed 
drastically over the last three years since the Iraq war. 
 
Yamamoto said: 
 
"Security in Baghdad has significantly worsened. You can hear 
explosions everyday. In our trip from the airport to the Hotel 
Palestine, we avoided taking any conspicuous cars and following 
US military vehicles because we didn't want to be get involved in 
an explosion. We also hired guards to prevent being kidnapped. I 
needed to practice maximum caution, and I didn't reveal any 
information on my activities to anyone except the people 
traveling with me." 
 
The top priority for citizens in Baghdad has also changed from an 
immediate withdrawal of the invading forces to improved security. 
 
Yamamoto continued: 
 
"I heard a lot of Baghdad citizens saying that the multinational 
force should take responsibility, that their departure from the 
country under the current situation would throw Iraq into greater 
chaos, and that they should stay in the country until Iraq 
becomes a safer country. They of course want the foreign troops 
out of their country once public security returns to Iraq. Their 
fear that they might become victims of a terrorist attack while 
shopping, for instance, is suppressing their dislike for US 
forces." 
 
Yamamoto visited Baghdad for the first time in March 2003, just 
three days before the Iraq war started. At the hotel, there was 
only one menu, instead of three, and everything tasted like 
ketchup. The three state-run television stations constantly aired 
programs featuring Saddam Hussein's speeches and war songs, which 
nobody watched them. Those days are gone. 
 
 
TOKYO 00000618  007.2 OF 008 
 
 
"Today, foreign electric appliances and foodstuffs are readily 
available. People can also enjoy tasty meals at any restaurant 
and watch programs on about 30 channels, such as CNN and FOX. 
Some people watch Hollywood movies all night long." 
 
During her stay in Iraq, the United Iraqi Alliance, Iraq's most 
powerful Shiite Muslim alliance, won the most seats but not a 
clear majority in the nation's first constitutional national 
election. 
 
Yamamoto explained the results this way: 
 
"Many people said to me that they didn't want the Shiite alliance 
to take a majority and turn Iraq into an extremely Islamic state. 
There are only a few clerics who are really radical. Everybody 
wants to eat good food, watch television, listen to music, and 
enjoy freedom. Many people expressed their fear that a Shiite-led 
government would result in alliance with Iran that would 
eventually suppress their freedom." 
 
Yamamoto has visited Samawah, where the SDF camp is located, on 
four occasions, including one in December 2003. Samawah citizens 
have been split on the SDF's reconstruction assistance. Visiting 
the city for the fourth time, Yamamoto felt that their discontent 
with Japan's assistance has grown stronger. The government has 
begun making arrangements with Britain and Australia to begin 
pulling out Japanese troops in March. 
 
"People in Samawah were aware that the SDF would withdraw. Many 
people indicated that the withdrawal would have no impact on 
their life, while some expressed regret, saying they hoped to see 
the SDF's active involvement in rebuilding and revitalizing the 
city. They didn't seem to quite understand why the Japanese 
troops have to pull out of Iraq in just two years." 
 
The poor evaluation of Japan's assistance in Samawah is largely 
ascribable to the SDF's inability to showcase their activities. A 
series of mortar attacks and a roadside explosion that damaged an 
SDF vehicle have forced Japanese troops to confine themselves in 
their camp hidden from the eyes of Samawah citizens. 
 
"I saw SDF troops providing clean water only occasionally for 
security reasons. Most of the time, Iraq people carried out such 
an activity, and SDF troops visited supply facilities only 
sometimes to oversee restoration work. All those things can 
explain why their assistance is not widely recognized in Samawah. 
I was asked often, 'Where are the SDF troops?' or 'When are they 
coming out of their camp?'" 
 
The SDF's activities have bore fruits in some parts of the city. 
During her latest visit to Samawah, Yamamoto took a firsthand 
look at the water treatment plant SDF troops have repaired. They 
have installed new water tanks and new pipes. As a result, clean 
water reserves have increased by six fold. 
 
"Water from that plant is being distributed to people in the 
vicinity of Samawah with no tap water. The inner city people 
would complain, 'SDF troops don't come here with water. Where are 
they?' Although the city has a water system, quantity is small 
and water's quality is poor. People are still in need of clean 
water." 
 
Yamamoto also interviewed locals at a site where a large power 
 
TOKYO 00000618  008.2 OF 008 
 
 
plant will be built with Japan's official development assistance 
(ODA). But Japan's efforts are not always appropriate. 
 
"Samawah's pattern today is that power is on for two hours and 
out for five hours. The plant's director said, 'The new plant 
will dispel the discontent of the households in the city.' He was 
also hopeful that the new plant would create 5,000 jobs. I wonder 
why Japan didn't build such a plant first?" 
 
Yamamoto still felt that the majority of Iraqi people had 
favorable feelings toward Japan. People who came in contact with 
SDF troops described them as 'friendly' and 'peaceful,' according 
to Yamamoto. What Japan should do for the future of Iraq? 
 
 
"Iraqis know that Japan took part in the Iraq war. So Japan needs 
to support Iraq's nation-building efforts in a responsible 
manner. Iraqi people won't give high marks to the way Japan has 
been proving assistance. Initiating projects is not enough. Iraqi 
people would think Japan has used the SDF mission for keeping a 
good relationship with the United States in the name of 
reconstruction assistance." 
 
Mika Yamamoto: Born in 1967 in Tsuru City, Yamanashi Prefecture; 
became freelance journalist in 1996 after serving as CS reporter 
after graduating from Tsuru University; covered Afghanistan 
before and after the 9/11 terrorist attacks on the US; coverage 
on wartime Iraq won the Vaughan-Ueda Memorial Prize in 2003; 
served as NTV newscaster from 2003 to 2004; publications include 
a book Chukei Sarenakatta Bagudaddo (Baghdad That Was Not 
Reported Live) published by Shogakukan. 
 
SCHIEFFER