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UNCLAS SECTION 01 OF 08 TOKYO 005902 
 
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 10/11/06 
 
 
INDEX: 
 
(1) North Korea in bind due to financial sanctions; Freeze on 
General Secretary Kim's 24 million dollars; Funds to buy loyalty 
depleted 
 
(2) Why did North Korea carry out nuclear test on Oct. 10? Did it 
choose day between anniversary of assumption of Secretary Kim and 
anniversary of formation of Korean Workers Party? Tit-for-tat action 
against Japanese, South Korean leaders? 
 
(3) Japan, US to study WMD countermeasures 
 
(4) Japan, US will now work in even closer cooperation 
 
(5) Poll on Abe cabinet, political parties, educational reform, 
North Korea, China, South Korea 
 
(6) Internet polling: Abe cabinet popular with unaffiliated young 
women 
 
(7) Business circles hoping for economic exchange to be promoted 
between Japan, China, following summit 
 
(8) Akie Abe, wife of Prime Minister Abe, who speaks Korean, becomes 
topic of conversation in Seoul; Reads Korean poem for elementary 
school children; Receives great applause from students 
 
ARTICLES: 
 
(1) North Korea in bind due to financial sanctions; Freeze on 
General Secretary Kim's 24 million dollars; Funds to buy loyalty 
depleted 
 
YOMIURI (Page 3) (Excerpts) 
October 11, 2006 
 
North Korea has opted to confront the international community by 
announcing that it has conducted a nuclear test. General Secretary 
Kim Jong Il, the country's supreme leader, has taken an 
ultra-hard-line measure, while being fully aware that his nation's 
economy will suffer a further setback when hit by even tougher 
sanctions following the nuclear test. He presumably judged that the 
only way for his country to survive is to take the international 
community's encirclement net as a "crisis" for his communist regime 
and strike back by making North Korea into a nuclear power. What 
drove North Korea into going to such an extreme? 
 
Oct. 10 marked the 61st anniversary of the formation of the Korean 
Workers Party. However, according to press reports from Pyongyang, 
there was no celebratory mood in the city. The communist party's 
organ paper Rodong Shinmun and the cabinet's organ paper Democratic 
Korea carried an editorial praising the party's politics for giving 
priority to military matters, but it did not refer to the nuclear 
test. 
 
Professor Kim Yong Su at Sogang University explained, "North Korea 
is in a tense situation." 
 
The main reason is the impact of international sanctions. The US in 
September 2005 invoked financial sanctions against Banco Delta Asia 
(BDA) in Macau, a bank with which North Korea had an account, citing 
the DPRK's use of the bank to launder money gained from 
 
TOKYO 00005902  002 OF 008 
 
 
counterfeiting greenbacks. Financial institutions of about 20 
countries, such as France and Singapore, followed suit and stopped 
transactions with North Korea. North Korea has come up short so 
seriously that it asked a South Korean bank, which had set up a 
branch in the Kaesong Industrial Park, a project jointly being 
developed by the two Koreas, to open a bank account for the North, 
but its request was turned down. 
 
Secretary Kim was hard hit by the financial sanctions, because the 
 
SIPDIS 
money in the frozen account - approximately 24 million dollars - was 
reportedly his own funds, which he used to govern the country. He 
had used this money in order to secure loyalty by showing "Dear 
Leader's" consideration, awarding Mercedes cars and expensive 
watches to senior officials and food to ordinary citizens. Chong 
Song Jang, researcher at the South-North Relations Research center 
of the Sejong Institute noted, "Now Kim cannot give gifts, since he 
cannot withdraw that money. He lost face, so another aim of the 
nuclear test therefore was for Secretary Kim to restore face." 
 
Flood damage caused by torrential rains in mid-July added to the 
setback stemming from the financial sanctions. The North Korean side 
reported the death toll at about 850. However, damage to homes was 
enormous. Pyongyang asked Seoul to send cement for recovery work. 
Professor Kim noted, "The morale of not only the civilian population 
as well as the military was seriously damaged due to the flood 
damage -- though the military received a temporary boost when the 
North test-fired missiles on July 5. Secretary Kim probably wanted 
to restore morale damaged by the flood." 
 
Rumor about power struggle between party and military 
 
Rumor has it that infighting is taking place within the leadership, 
which has engaged in competition to show loyalty to Kim. South 
Korea's Yonhap News Agency reported that Kim and the military 
jointly decided to carry out the nuclear test. The Foreign Ministry, 
which has failed to win concessions from the US, though it is in 
charge of the six-party talks, was kept in the dark. 
 
The military and the party have been considered as two wheels of a 
cart for the North Korean regime. The view is growing, however, that 
an increasing number of party members are unhappy with the situation 
in which the military alone is becoming powerful due to the regime's 
trend of giving top priority to military matters. 
 
(2) Why did North Korea carry out nuclear test on Oct. 10? Did it 
choose day between anniversary of assumption of Secretary Kim and 
anniversary of formation of Korean Workers Party? Tit-for-tat action 
against Japanese, South Korean leaders? 
 
YOMIURI (Page 3) (Full) 
October 11, 2006 
 
The predominant view is that North Korea decided to conduct a 
nuclear test on the day between the 8th, the 9th anniversary of the 
assumption of Kim Jong Il as Secretary of the North Korean Communist 
Party and the 10th, the 61st anniversary of the formation of the 
Korean Workers Party - Oct. 9. 
 
Professor Nam Song Uk at Koryo University in South Korea, noted, 
"Chances are high that North Korea had been preparing to conduct the 
test on the 9th, since it released the announcement on Oct. 3 
notifying its plan to carry out such a test." 
 
 
TOKYO 00005902  003 OF 008 
 
 
There were no reports on Kim's activities since his inspection of 
the Kimkangsan test site on Sept. 15. But on the evening of Oct. 5, 
he reportedly met with participants of a congress of the commander 
of the Korean People's Army and the battalion political leadership. 
The prevailing view is that Kim withdrew into seclusion during this 
19-day period and decided to carry out a nuclear test, after drawing 
up a strategy. It is true that Kim frequently meets with mid-ranking 
military personnel before he makes key decisions. 
 
Some also take the view that Kim chose Oct. 9 to get his revenge on 
Prime Minister Abe, who has been taking a hard-line stance toward 
Pyongyang, and South Korea President Roh Moo Hyun, who has suspended 
humanitarian assistance to North Korea under international pressure. 
He, however, avoided Oct. 8, when the Japan-China summit meeting 
took place, thereby staving off infuriating China. 
 
North Korea has apparently prepared the nuclear test under 
extraordinary secrecy. Even so, the US had detected Pyongyang's 
moves. Japanese and US government officials during last week's 
meeting shared the view that there was a possibility of Pyongyang 
conducting a nuclear test over the weekend. 
 
(3) Japan, US to study WMD countermeasures 
 
YOMIURI (Page 2) (Full) 
October 11, 2006 
 
Japan and the United States will set about an intergovernmental 
study of a framework for bilateral cooperation, as well as specific 
measures, in order to prevent the proliferation of damage resulting 
from the actual use of weapons of mass destruction, such as nuclear, 
biological, and chemical (NBC) weapons. The Japanese and US 
governments will hold a meeting of senior working-level officials in 
Washington from Oct. 11 to talk about the realignment of US forces 
in Japan and other bilateral issues. At the same time, working-level 
officials from the Japanese Defense Agency and the US Department of 
Defense will exchange views for the first time. 
 
The two governments have decided to move up their initial schedule 
for their talks since North Korea went ahead with a nuclear test. 
North Korea has admitted to its possession of biological and 
chemical weapons. North Korea's stockpiles of chemical weapons 
amount to 4,000 tons, according to the South Korean National 
Intelligence Service. 
 
In their upcoming consultations, the Japanese and US governments, 
with North Korea's potential use of NBC weapons in mind, will 
presumably focus on specific measures, such as: 1) decontaminating 
areas contaminated with the use of NBC weaponry; and 2) preparing to 
conduct military operations on a standing basis in contaminated 
areas. The two governments also mull working together to develop 
anti-NBC equipment in the future. 
 
The two governments will have the results of their consultations 
reflected in their "bilateral defense planning" for emergencies in 
Japan and also in their "mutual cooperation planning" for 
emergencies in areas surrounding Japan. 
 
(4) Japan, US will now work in even closer cooperation 
 
SANKEI (Page 3) (Full) 
October 11, 2006 
 
 
TOKYO 00005902  004 OF 008 
 
 
By Satoshi Morimoto, professor at Takushoku University Graduate 
School of Institute for International Cooperation Studies 
 
North Korea's nuclear test was presumably still in a primitive 
stage, so I don't think a full-fledged device was exploded. In order 
to enhance the effectiveness, more than one nuclear test is 
necessary. A second test will likely take place soon. Following 
ballistic missile launches, Pyongyang is pursuing the development of 
weapons of mass destruction in defiance of the six-party agreement. 
It perhaps believes there are many things to gain by this, and 
nothing to lose. 
 
Pyongyang appears to be expecting the United States to capitulate. 
But the US instead may aim at "regime change" of the Kim Jong Il 
structure. Japan and the US must work in even closer cooperation 
than before in order to overcome this nuclear crisis. 
 
The most crucial matter is that if the United Nations Security 
Council (UNSC) adopts a resolution in accordance with the UN 
Charter's Chapter 7, searches of North Korean ships on the high seas 
would be carried out as part of the sanction measures, but (Japan) 
has no legal ground for carrying out such inspections. 
 
There is no legal ground for such ship searches, even though under 
the Ship Inspection Act, the Maritime Self-Defense Force (MSDF) can 
stop and search ships in the event of a contingency in an area 
surrounding Japan. If Japan establishes a special measures law and 
joins the US in ship searches, which is a part of a naval blockade, 
it must anticipate using armed force. I don't think the SDF can take 
part in this kind of operation without first either altering the 
interpretation of the right to collective self-defense or amending 
the Constitution. 
 
On the plan to introduce missile defense, calls to speed up 
deployment have been growing stronger since North Korea's missile 
launches. But even more important, Japan and the US must first 
coordinate their chains of command in preparation for such a joint 
operation. We tend to pay too much attention to equipment, for 
instance, buying more bullets from the US, but we sidestep how Japan 
and the US will actually cooperate in an operation, though that 
aspect is critical. 
 
From a different point of view, North Korea's actions can be viewed 
as driving us into a corner. Instead of irresponsibly saying, "We 
have no way to deal with the North Korean threat," policy makers 
must devote themselves to passing legislation that set the proper 
rules. 
 
(5) Poll on Abe cabinet, political parties, educational reform, 
North Korea, China, South Korea 
 
ASAHI (Page 4) (Full) 
October 11, 2006 
 
Questions & Answers 
(Figures shown in%age, rounded off. Bracketed figures denote 
proportions to all respondents. Parentheses denote the results of a 
survey conducted Sept. 26-27.) 
 
Q: Do you support the Abe cabinet? 
 
Yes       63       (63) 
No        14       (18) 
 
TOKYO 00005902  005 OF 008 
 
 
 
Q: Why? (One reason only. Left column for those marking "yes" on 
previous question, and right for those saying "no.") 
 
The prime minister is Mr. Abe       21(14)       11(2) 
It's an LDP-led cabinet             19(12)       39(6) 
From the aspect of policies         29(18)       40(6) 
No particular reason                28(18)        7(1) 
 
Q: Which political party do you support now? 
 
Liberal Democratic Party (LDP)                    42       (39) 
Democratic Party of Japan (DPJ or Minshuto)       14       (14) 
New Komeito (NK)                                   2        (3) 
Japanese Communist Party (JCP)                     2        (2) 
Social Democratic Party (SDP or Shaminto)          1        (1) 
People's New Party (PNP or Kokumin Shinto)         0        (0) 
New Party Nippon (NPN or Shinto Nippon)            0        (0) 
Liberal League (LL or Jiyu Rengo)                  0        (0) 
None                                              33       (35) 
No answer (N/A) + don't know (D/K)                 6        (6) 
 
Q: Do you think Mr. Abe is a man of ability for prime minister, or 
do you otherwise think he's falling behind in his popularity? 
 
He's a man of ability for prime minister       18 
He's falling behind in his popularity          56 
 
Q: North Korea proclaimed on the morning of Oct. 9 that it had 
conducted an underground nuclear test. Do you feel a threat from 
North Korea due to its recent nuclear test? (One choice only) 
 
Feel strongly                  44 
Feel somewhat                  38 
Don't feel very strongly       13 
Don't feel at all               4 
 
Q: Do you think the international community should pursue dialogue 
with North Korea from now on, or do you otherwise think it should 
weigh sanctions against that country? 
 
Dialogue        26 
Sanctions       62 
 
Q: Prime Minister Abe visited China and South Korea on Oct. 8-9 and 
met with their leaders. Do you appreciate this? 
 
Yes       83 
No         8 
 
Q: In the Japan-China summit talks, China called for Japan to 
resolve the history issue, including the problem of visiting 
Yasukuni Shrine. Prime Minister Abe stated that he wouldn't say 
whether he would visit there or not. Instead, he answered that he 
would like to deal with the problem in an appropriate manner. Do you 
appreciate Mr. Abe for this response? 
 
Yes       52 
No        33 
 
Q: Do you think Prime Minister Abe's visit to China this time will 
improve diplomatic relations between Japan and China? 
 
 
TOKYO 00005902  006 OF 008 
 
 
Yes       57 
No        25 
 
Q: Then, do you think his visit to South Korea this time will 
improve diplomatic relations between Japan and South Korea? 
 
Yes       56 
No        26 
 
Polling methodology: The survey was conducted from the evening of 
Oct. 9 through the evening of Oct. 10 over the telephone on a 
computer-aided random digit dialing (RDD) basis. Respondents were 
chosen from among the nation's voting population on a three-stage 
random-sampling basis. Valid answers were obtained from 1,023 
persons (58% ). 
 
(6) Internet polling: Abe cabinet popular with unaffiliated young 
women 
 
TOKYO SHIMBUN (Page 2) (Full) 
October 3, 2006 
 
The rate of public support for Prime Minister Shinzo Abe and his 
newly inaugurated cabinet was 56.1% in the Tokyo Shimbun's latest 
5th Internet poll of monitors on political trends. In the breakdown 
of public support for the Abe cabinet, the approval and disapproval 
ratings among men were split evenly at 50.0% each. Among women, 
however, the approval rating was 63.0%. The Abe cabinet's popularity 
among women was overwhelmingly higher than that among men. 
 
Looking at the age brackets of women supporting the Abe cabinet, 
those in their 20s marked the highest rate of support at 70.0%. 
 
In the breakdown of women supporting the Abe cabinet into supporters 
for political parties, 54.8% of those in their 30s and 51.9% of 
those in their 40s answered that they had no political party to 
support. In the bracket of those in their 20s, those who have no 
party to support accounted for 38.1%. The proportion of women with 
no particular party affiliation in these age brackets was higher 
than that of women supporting the ruling Liberal Democratic Party in 
the corresponding age brackets. 
 
The smart, soft image of Abe seems to have gathered support from 
young women who have no party to support. 
 
Meanwhile, the approval rating for the Abe cabinet was below 50% 
among men in some age brackets. In particular, among men of Abe's 
generation in their 50s, the approval rating for the Abe cabinet was 
41.3%, the lowest level among all generations. 
 
In addition, the Abe cabinet's support rate was low among younger 
generations, as seen from such figures as 43.8% among those in their 
20s and 44.1% among those in their 30s. Abe is giving priority to 
his policy of backing up "second chances," and he has shown his 
policy course of promoting full-time job opportunities for young 
people not in education, employment or training (NEET) and for 
part-time jobbers. This, however, does not seem to be very popular 
with them. 
 
(7) Business circles hoping for economic exchange to be promoted 
between Japan, China, following summit 
 
NIHON KEIZAI (Page 5) (Full) 
 
TOKYO 00005902  007 OF 008 
 
 
October 9, 2006 
 
The Oct. 8 meeting between Prime Minister Shinzo Abe and Chinese 
President Hu Jintao has effectively worked to assuage concern about 
the possibility that economic relations between Japan and China 
might also become strained. Business leaders are now hoping to see 
an expansion of business relations with China, given that country's 
sharp economic growth, particularly in the coastal areas, where 
there is a potential consumer market. Still, some of the many 
companies that have invested solely in China are worried about an 
excessive concentration of investment in China. 
 
Concern about deterioration of economic ties with China abated 
 
In response to the Japan-China summit, a welcoming mood is sweeping 
across Japan's industrial circles. President Eizo Kobayashi of 
Itochu Corporation, which has 67 companies that have invested in 
China, stated, "I hope that economic cooperation between Japan and 
China will enter a new era." Hitachi issued a statement noting, "We 
hope to see the friendship between Japan and China deepen following 
the recent summit meeting." 
 
The spreading sense of relief in the business world reflects the 
gradually deepening economic interdependence between Japan and 
China. According to the Finance Ministry, Japan's total trade with 
China, including Hong Kong, topped that of the United States with 
China in 2004. An increasing number of Japanese companies are now 
eager to invest directly in China, eyeing that country's potential 
as a consumer market. 
 
Matsushita Electric Industrial Co. has step up efforts to promote 
sales of digital appliances such as flat-screen TVs and large 
household appliances in China, setting the target of recording sales 
of one trillion yen. The company released a comment saying, "We 
anticipate that improvement in Japan-China relations will promote 
economic exchange." 
 
President Hitoshi Ogita of Asahi Breweries, who suffered losses 
followng the anti-Japanese demonstrations in China last April, said, 
"I am looking for progress to be made on the historical issue and on 
rights to develop marine resources." Suntory President Nobutada Saji 
remarked, "I highly appreciate Prime Minister Shinzo Abe's visit to 
China right after the inauguration of his government." 
 
Banks and other financial institutions are expecting to be allowed 
to open more branches in China. Since the Koizumi administration was 
launched in 2001, Chinese authorities have allowed only Mizuho 
Corporate Bank and Mitsui Sumitomo Bank to open branches in Wuxi Shi 
and Hangchou, respectively. HSBC of Britain has already been 
authorized to open four branches. Some attribute this situation to 
former Prime Minister Junichiro Koizumi's visits to Yasukuni 
Shrine. 
 
A growing number of Japanese firms, however, are now turning their 
attention to countries or regions other than China. This is the 
so-called "China-plus-one" trend, which is attributed to a rise in 
personnel costs, mainly in coastal regions, as well as an ongoing 
review of the preferential tax measures China has introduced for 
foreign investors. Some companies are worrying about whether China's 
current high economic growth will be long lasting. 
 
Meanwhile, Japan doubled its investment in India in 2005 over the 
previous year. Some companies are willing to diversify their 
 
TOKYO 00005902  008 OF 008 
 
 
investment destinations, with Honda Motor's decision to boost its 
production capability in Vietnam by 30% by 2007. An official of the 
Japan External Trade Organization's (JETRO) Chinese and North Asian 
Affairs Division commented, "Our perception that over-concentrating 
investment in China is risky." 
 
(8) Akie Abe, wife of Prime Minister Abe, who speaks Korean, becomes 
topic of conversation in Seoul; Reads Korean poem for elementary 
school children; Receives great applause from students 
 
SANKEI (Page 6) (Full) 
October 11, 2006 
 
Katsuhiro Kuroda, Seoul 
 
Akie Abe, who visited South Korea along with her husband, Prime 
Minister Shinzo Abe, was very popular in Seoul. Known for being a 
fan of South Korean culture, she has been studying Korean. She 
gained popularity among Koreans by showing her ability in that 
language. 
 
The First Lady visited an elementary school in Seoul. Attending a 
Korean class for students in the second grade, she read out a poem 
in Korean from a textbook. Her reading was greeted with applause 
from the students and their teacher. 
 
At a dinner party hosted by President Roh Moo Hyun, she enjoyed a 
simple conversation in Korean with Kwon Ryang Suk, the president's 
wife. Her ability of Korean was noticed and talked about. Mrs. Abe 
reportedly has been studying Korean for about three years. The 
Korean side gave her high marks, with one saying, "The level of her 
Korean is considerably high for a foreigner." 
 
Since it has been reported that Akie is an ardent fan of Korean 
culture, Korean people have had a strong interest in her. She was 
the center of media attention. In a column titled "Japan's First 
Lady's cultural diplomacy" in its issue on Oct. 10, The Dong-A Ilbo 
lauded her expected role to ease the strong sentiments of the 
peoples of both countries. The newspaper expects her to play such a 
role in the future. 
 
SCHIEFFER