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UNCLAS SECTION 01 OF 07 TOKYO 003101 
 
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 06//06 
 
INDEX: 
 
(1) Post-Koizumi contenders -- A study of Yasuo Fukuda (Part 1): 
Widening support of Fukuda but he hides his true intentions 
 
(2) Challenges of resources-poor country: Energy security (Part 
3): Strategy to independently develop oilfields shifted toward 
private sector 
 
(3) Ozawa's explanation about his poor health creates rumor that 
he would let other party member serve in the prime minister's 
post if Minshuto took power 
 
(4) Contrasting health conditions of two New Komeito leaders 
 
(5) Opposition feels sorry for Internal Affairs Minister Takenaka 
 
(6) Name of Vice Minister Shotaro Yachi floated as possible next 
ambassador to US 
 
(7) Asahi again suspected of altering Yasukuni statement 
 
(8) Local discontent with GSDF grows in Samawah, Iraq; "Our 
livelihood has not improved during the past two years" 
 
ARTICLES: 
 
(1) Post-Koizumi contenders -- A study of Yasuo Fukuda (Part 1): 
Widening support of Fukuda but he hides his true intentions 
 
NIHON KEIZAI (Page 2) (Slightly abridged) 
June 5, 2006 
 
"Japan faces a number of problems, for instance, the declining 
birth rate, budget deficits, and rising countries in the region. 
Let's act together and strive for the development of Japan." 
Yasuo Fukuda made this remark in an opening speech given at a 
political fund-raising party on May 31 of the Liberal Democratic 
Party's (LDP) Mori faction, addressing an audience filling the 
party hall. Some may take the remark as expressing his 
willingness to run in the LDP presidential race to determine a 
successor to Prime Minister Koizumi, but others may take it as 
simply showing his general views. 
 
Fukuda appears less attentive to his rising popularity in the 
polls. He at times gives an impression of ignoring them, but he 
does not dismiss them altogether. His attitude is unique, 
compared to other potential post-Koizumi contenders who are 
gradually making clear their intentions to run in the 
presidential election. 
 
Growing distrust of Koizumi-led Asia diplomacy 
 
On the morning of May 7, 2004, Fukuda telephoned his eldest son, 
Tatsuya, who serves as personal secretary to him, and to people 
working for him in his constituency in Takasaki City, Gunma 
Prefecture, to say: "I am stepping down from the post (of chief 
cabinet secretary)." 
 
One week before he resigned from his post, Fukuda pressed Prime 
Minister Junichiro Koizumi in his office to listen to him. 
Koizumi was making preparations secretly to revisit North Korea, 
but Fukuda openly raised doubts about the way Koizumi was 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
preparing for such a revisit. 
 
Fukuda: "As chief cabinet secretary, I have not been informed of 
the revisiting plan. The Foreign Ministry also has told me it has 
no idea about it. Who is in charge of the revisit plan?" 
 
Koizumi: "I can't reveal anything." 
 
Fukuda: "Please tell me." 
 
Koizumi: "I can't" 
 
Fukuda: "Please tell me." 
 
Koizumi: "I can't" 
 
Recently Fukuda has raised criticism about Koizumi's visits to 
Yasukuni Shrine. Fukuda said clearly: "When you discuss something 
with someone, you need to factor in the circumstances surrounding 
that person, or you will end up merely having a quarrel with that 
person. It's terrible for the top leaders as well as the peoples 
of the two countries to become emotional toward each other." This 
remark reflects Fukuda's distress that he was unable to persuade 
Koizumi not to visit the shrine. 
 
"I have unfinished tasks, such as Iraq, North Korea, and Yasukuni 
Shrine. I can't put all the responsibilities on the prime 
minister." On April 25, Fukuda concluded his speech by this 
remark, thereby revealing his willingness to reshape Japan's Asia 
diplomacy. 
 
Magnet to anti-Koizumi forces 
 
Fukuda's distrust of Koizumi's diplomacy and his criticism of 
Koizumi are viewed as the antithesis of Shinzo Abe, who is likely 
to take over Koizumi's policy lines. So, Fukuda is in a way 
magnet to veteran lawmakers alarmed by the generational change, 
as well as anti-Koizumi and anti-Abe forces. 
 
Fukuda himself gives the impression that he trying to gain 
broader support. Taku Yamasaki, Koichi Kato and are active 
members of a nonpartisan parliamentary league that wants to 
construct a memorial facility to replace Yasukuni Shrine. Fukuda 
also assumed the post of chair of a group of lawmakers first 
elected to the Diet when they were in their 50s, "Chimei Risshi 
Kai". 
 
Fukuda, however, never reveals his true intentions even to fellow 
lawmakers, always making formal comments at the formal stage. A 
certain veteran legislator said when he dined with Fukuda, he 
suggested, "If you run in the race, I will endorse you," but 
Fukuda would not make clear his attitude. This lawmaker grumbled: 
"I was disappointed." 
 
When it comes to Abe, who is also a member of the same Mori 
faction as Fukuda, Abe has mid-level and junior lawmakers inside 
and outside the faction as his supporters. They are hoping for 
Abe to become the prime minister. Former Prime Minister Yoshiro 
Mori, who heads the faction, made this comment: "Mr. Abe has more 
members in the party to stand up for him than Mr. Fukuda. Only a 
few hold discussions with Mr. Fukuda." 
 
Fukuda's continued silence could set a mood for the faction to 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
unify around Abe, and if such becomes the case, chances cannot be 
ruled out that groups tending to jump on the bandwagon will move 
to endorse other candidates. 
 
Is the time ripe for Fukuda to run? Will his running in the race 
end up as an elusive dream? All eyes in the party are now fixed 
on Fukuda's every movement. 
 
(2) Challenges of resources-poor country: Energy security (Part 
3): Strategy to independently develop oilfields shifted toward 
private sector 
 
SANKEI (Page 3) (Abridged) 
June 3, 2006 
 
The Rang Dong offshore oilfield sitting 130 kilometers east of 
the southern Vietnamese tourist spot of Vung-tau began production 
eight years ago. It has produced over 100 million barrels of 
crude oil, from which it was easy to extract gasoline and other 
types of fuel. 
 
The Rang Dong oilfield was explored and developed under the 
initiative of Japanese corporations. Mitsubishi Oil Co. 
(currently Nippon Oil Corp.) won rights to a drilling area in 
¶1992. Reportedly, the successful oil development rate is 0.3%. 
Against all odds, Japan Vietnam Petroleum Co. (JVPC), established 
in 1992, successfully struck oil deposits in its first test 
drilling. 
 
The JVPC was financed 44% by the now-defunct Japan National Oil 
Corporation (JNOC), which has been launched in 1967 with the aim 
of providing oil development projects with public financing. For 
Japan, which was poor in natural resources, independently 
developing oilfields was essential in order to ensure access to 
oil. The launching of JNOC was seen as having great significance. 
 
But an oil company exploration engineer revealed that the only 
exploration projects that companies brought to JNOC were those 
with little promise. JNOC injected funds into projects without 
checking their profitability, while the private sector leaned on 
the JNOC to avoid risks. Such a system came to light in June 
¶1998. At that point, JNOC was saddled with 1.4 trillion yen in 
bad loans despite the fact that it had funneled 2 trillion yen 
into oil exploration and development. 
 
The Rang Dong Oilfield is one of the few successful projects JNOC 
handled. In December 2001, the government finally made a cabinet 
decision to abolish JNOC after reassessing special corporations 
in general, putting an end to Japan's independent effort to 
expand the development of oilfields in collaboration with the 
private sector. 
 
It has been four years and a half since then. The government is 
again trying to shift back to independent development of 
oilfields. Oil prices are now at historic highsl, and demand for 
oil in China and India is growing due to their economic 
development. Given the intensifying global race to corner natural 
resources, Petroleum Association of Japan President Fumiaki 
Watari is welcoming the government's policy shift. The government 
has drafted a national energy strategy incorporating a target of 
increasing the ratio of independently developed oil to imported 
oil from the current 15% to 40% by the year 2030. 
 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
Prior to the abolition of JNOC, the oil industry fiercely 
objected to the government's decision not to set import targets. 
They feared that the absence of targets would result in a lack of 
public support measures. Part of JNOC's operations, including 
providing oil development funds, have been handed down to Japan 
Oil, Gas, and Metals National Corporation (JOGMEC). The 
organization has yet to provide funds to any exploration project. 
It is probably because a set of screening criteria have been 
tightened based on criticism of JNOC. An industrial source 
criticized the government's policy shift, saying, "There was no 
need to abolish JNOC." 
 
Former International Trade and Industry Minister Mitsuo Horiuchi, 
who had shed light on the actual situation of JNOC, defended the 
government's decision, saying: "We had to get rid of JNOC's 
wasteful spending and sloppy accounting, but Japan still needs an 
oil policy that backs up the private sector." 
 
With the skyrocketing of oil prices, having stable oil resources 
is increasingly vital. Japan can no longer afford to invest in 
projects by disregarding their profitability. The country is in 
need of a new scheme to expand the independent development of 
oilfields at the initiative of the private sector. 
 
(3) Ozawa's explanation about his poor health creates rumor that 
he would let other party member serve in the prime minister's 
post if Minshuto took power 
 
SENTAKU (Page 46) (Full) 
June 2006 
 
A rumor is going around the political district of Nagatacho that 
Ichiro Ozawa, president of the main opposition party Minshuto 
(Democratic Party of Japan), does not want to become prime 
minister. 
 
The reason is because Ozawa has explained the details of his 
health condition at a press conference. A senior Minshuto member 
was perplexed by his remarks and said, "It is tantamount to 
admitting that he cannot fulfill the job of prime minister." 
Ozawa aims at a regime change by winning next year's House of 
Councillors election. Some Minshuto members, however, have 
already talked about a possibility that if the party takes power, 
Ozawa would let another party member assume the prime minister's 
post, while continuing to wield influence behind the scenes. 
 
(4) Contrasting health conditions of two New Komeito leaders 
 
SENTAKU (Page 44) (Full) 
June 2006 
 
A rumor is going around that New Komeito leader Takenori Kanzaki 
collapsed on May 15 while dining at an eel restaurant in the 
Akasaka district. He also fell down at a Chinese restaurant on 
March 2, though he does not have a serious illness. 
 
The New Komeito has already decided that Kanzaki will step down 
from his post to make way for a new leadership. The question is 
how to treat Secretary General Tetsuzo Fuyushiba, who enjoys 
vigorous health. The dominant view in the party is that there is 
no other choice for the party to give an key cabinet post to 
Fuyushiba and have Kazuo Kitagawa, who is now serving as minister 
of land, infrastructure and transport, return to the ranks of the 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
party. 
 
(5) Opposition feels sorry for Internal Affairs Minister Takenaka 
 
SENTAKU (Page 45) (Full) 
June 2006 
 
The rumor is that Heizo Takenaka, minister of internal affairs 
and communications, has become somewhat reclusive. But appearing 
recently at a seminar held in Kyoto, he seemed in high spirits. 
He named the encirclement net around him as the "fourth round of 
Takenaka bashing"; and he criticized bureaucrats who had tried to 
protect their vested interests by opposing the government's 
postal-privatization plan and reform of the government-affiliated 
financial institutions. 
 
Takenaka, has changed himself into "a person attentive to other 
persons," and he calls daily on LDP Upper House Secretary General 
Toranosuke Katayama, who has influence over the administration of 
the Internal Affairs Ministry, to consult with him prior to 
negotiations with the party on policy issues. Because of his 
efforts, criticism of Takenaka in the Upper House has weakened. 
 
It is true, though, that Takenaka's policy influence has waned 
since he lost two backers: the Council on Economic and Fiscal 
Policy and Prime Minister Junichiro Koizumi. An opposition camp 
lawmaker was sympathetic to Takenaka, saying, "He continues to 
provoke the Finance Ministry, the same way he did when he was a 
standard-bearer for Prime Minister Koizumi's reform drive." The 
same lawmaker criticized Koizumi, noting, "Mr. Takenaka was taken 
advantage as much as possible. I feel sorry for him." 
 
(6) Name of Vice Minister Shotaro Yachi floated as possible next 
ambassador to US 
 
THEMIS (Page 37) (Full) 
June 2006 
 
The Foreign Ministry has been having difficulties in choosing a 
replacement for Ambassador to the US Ryozo Kato, who has served 
in his post more than the usual four-year term. 
 
According to a major daily political reporter, the possibility is 
that Administrative Vice Foreign Minister Shotaro Yachi, who may 
retire from the ministry this summer, will be appointed as the 
next ambassador to the US after matters simmer down. 
 
If that is the case, the names of deputy ministers Tsuneo Nishida 
and Mitoji Yabunaka will be mentioned as the successor to Yachi. 
Nishida is desperate to play up his capability at the mid-July 
Group of Eight summit in St. Petersburg, according the political 
reporter. 
 
If Yachi remains in his post beyond the summer, "Nishida would 
become the ambassador to the US," said the political reporter. 
 
Attention is also focused on the next destination of Ambassador 
to China Koreshige Anami, who retired as of May 8. He reportedly 
will serve as advisor to a major private company that conducts 
business with China. Anami was quoted as telling persons around 
him, "I have received job offers from two companies. But I want 
to be free for about six months." 
 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
(7) Asahi again suspected of altering Yasukuni statement 
 
SENTAKU (Page 99) (Full) 
June 2006 
 
"Japan, which cannot even engage in a dialogue with neighboring 
countries, is completely useless to the United States." On April 
30, the Asahi Shimbun's morning edition front-paged this 
statement reportedly made by an American academic. According to 
the newspaper, Kent Calder, Director of the Edwin O. Reischauer 
Center for East Asia Studies, Johns Hopkins University, made the 
comment in an article titled "Yasukuni issue casting a shadow on 
Japan-United States relations." But Calder flatly denied the 
quote in the Asahi report, saying, "I did not say such a thing." 
An angry Calder reportedly protested to the Asahi. 
 
The Asahi seems to have altered Calder's statement to fit its 
standpoint. An American expert noted: 
 
"Most American intellectuals are opposed to Prime Minister 
Koizumi's visits to Yasukuni Shrine. The paper should have quoted 
such a person. There was no need to alter a conversation." 
 
(8) Local discontent with GSDF grows in Samawah, Iraq; "Our 
livelihood has not improved during the past two years" 
 
YOMIURI (Page 7) (Full) 
June 3, 2006 
 
Keiko Iizuka, Samawah (in the southern part of Iraq) 
 
The multinational forces in southern Iraq will transfer security 
control this month to the city of Samawah in Muthanna Province 
where Japan's Ground Self-Defense Force (GSDF) troops have been 
deployed for reconstruction assistance. Samawah will become the 
first recipient of such authority. The city is relatively stable 
in terms of public safety, but it suffers from a high jobless 
rate and slow progress in the reconstruction of its 
infrastructure. As a result, local discontent remains unabated. 
 
After consulting with Iraq's legitimate government and then 
assessing the security in each province, the multinational forces 
will transfer security authority to the province, Muthanna being 
the first case. 
 
British and Australian forces are deployed at Camp Smitty in 
Samawah. British Captain Hugo Lloyd (TN: phonetic) in charge of 
operation plans in Camp Smitty said: "Muthanna will become a 
symbol of democratization in Iraq as well as progress in 
reconstruction in that country. Japan's Self-Defense Forces' 
participation in reconstruction of Iraq is significant in 
historical terms." 
 
Compared to Basra, a largest city in south of Iraq where the 
security situation is deteriorating at a faster pace, Samawah is 
said to be relatively stable, but on May 31, tensions heightened 
in the city, following the discovery of roadside bombs at three 
locations around the city. In addition, another incident occurred 
in May involving the insurgent Mahdi Army, which attacked local 
police. Samawah is not in a completely quiet situation. In 
addition, slow progress in rebuilding the infrastructure is 
adding fuel to local discontent.  On June 1, a power failure 
occurred involving the whole city in the evening on a day when 
 
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SUBJECT:  DAILY SUMMARY OF JAPANESE PRESS 06//06 
 
soaring temperature reached 49 degrees. The power failure lasted 
for nine hours. 
 
Locals now direct their discontent at the GSDF, dismissing the 
previous strong expectations of the troops they when 
reconstruction activities were launched in 2004. 
 
A 37-year-old English language teacher, Wahimu (TN: phonetic), 
complained to this reporter on June 2: "I couldn't sleep today, 
either, because it was (terribly hot) all night long. Our lives 
have not improved although it's been two years since Japan's Self- 
Defense Forces troops began their work here." 
 
An interpreter, Wadihi (TN: phonetic), 32, also complained about 
SDF personnel for tending to confine themselves to their camp: 
"Rebuilding schools and hospitals is important, but we urgently 
need electricity for our livelihood. A relative of mine living in 
a neighboring province told me, 'It's good that people from Japan 
that is famous for Sony and Toyota have come and stayed,' but I 
disagree. I would like SDF personnel to visit people like me and 
listen firsthand to what our needs are." 
 
Because Japan is a technological giant, Iraqis have had high 
hopes that it would help rebuild the electric power system to 
bring a stable supply of electricity to the country, since power 
shortages remain a serious problem across the country. Local 
disappointment with Japan is the other side of the coin of their 
previous strong expectation of the GSDF. 
 
The GSDF has hired some 600 local residents for daily 
reconstruction work. It has already completed repair work on more 
than 200 schools and bridges. The British forces' headquarters in 
Basra praises Japanese troops deployed here: "The SDF, based on 
their remarkable work precision, have been highly appreciated by 
the coalition forces." 
 
Captain Lloyd said: "A grand ceremony will be held at Camp Smitty 
at the time of the transfer of security authority to Muthanna 
Province." The ceremony will mark the time for the GSDF to end 
its activities in the region, but that does not mean that local 
discontent will be eased. 
 
SCHIEFFER