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RUCNDT/USMISSION USUN NEW YORK 3045

UNCLAS SECTION 01 OF 07 TOKYO 000259 
 
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 01/19/07 
 
 
INDEX: 
 
(1) Okinawa governor says before meeting of Futenma consultative 
panel, "I'll make efforts to bring it about, centering on 
government's plan" 
 
(2) Japan, US, Australia urged to conclude international peace 
cooperation agreement 
 
(3) Editorial: Bid-rigging involving Land, Infrastructure and 
Transport Ministry; Time for investigative officials to step in 
 
(4) Abe administration (Part 2): Support organizations unable to 
gauge distance with LDP 
 
(5) Scramble for natural resources - Part 10 (conclusion): 
Development of gas fields lies as thorn in Japan-China relations; 
Doubts cast over "early joint development" 
 
ARTICLES: 
 
(1) Okinawa governor says before meeting of Futenma consultative 
panel, "I'll make efforts to bring it about, centering on 
government's plan" 
 
ASAHI (Page 3) (Full) 
Eve., January 19, 2007 
 
The third round of talks at the consultative council composed of the 
central government and local governments to discuss the relocation 
of the US Marine Corps Air Station Futenma (in Ginowan City, Okinawa 
Prefecture) in line with the realignment of US forces in Japan was 
held at the Prime Minister's Official Residence (Kantei) this 
morning. In the session, the central government gave a briefing on 
the background of the agreement reached in last May by Japan and the 
United States for the construction of V-shaped runways, and it 
outlined the proceedings and other steps that needed to be taken 
before the start of construction. In response, Okinawa Gov. Hirokazu 
Nakaima emphasized he would be positive about moving ahead with 
negotiations, noting: "In line with the basic confirmation exchanged 
in last May between the central government and the Okinawa 
prefectural government (to follow the government's plan in 
principle), I will make efforts in the future, as well, to implement 
the plan at an early date as much as possible." 
 
Meeting the press after the session, Nakaima stated, "If the talks 
reach an agreement, centering on (the central government's plan), I 
must work to help make that occur." Nakaima thus indicated a certain 
degree of understanding toward the central government's plan. On the 
other hand, he indicated there was need for fine-tuning to the plan, 
noting: "Given such problems as the environment, I think a form 
different from the current one will at least be necessary." 
 
Meanwhile, during the council's informal talks, Nago Mayor Yoshikazu 
Shimabukuro suggested moving the location shown in the government's 
plan southwestward toward the sea, saying, "I think it is better for 
the runways to be constructed as far as possible from the 
settlements. Speaking for the government, Defense Minister Kyuma 
went no further than to say: "I'd like to work hard to iron out 
differing views." After the council session, Nakaima called on Prime 
Minister Abe and asked for continued economic assistance measures. 
 
(2) Japan, US, Australia urged to conclude international peace 
 
TOKYO 00000259  002 OF 007 
 
 
cooperation agreement 
 
SANKEI (Page 15) (Abridged) 
January 19, 2007 
 
By Satoshi Morimoto, director of Takushoku University Institute of 
World Studies 
 
It is a great pleasure to see that the Defense Agency has been 
upgraded to a ministry. It was a bit regrettable, however, that the 
agency was not made into "national defense ministry." 
 
What is more important is that the Self-Defense Forces' 
international peace cooperation activities have been upgraded to 
primary duties. As the next step, the Defense Ministry and the SDF 
are urged to improve their equipment and organizations and train 
themselves in order to engage in international peace cooperation 
activities in an effective manner. At the same time, the government 
must study such factors as the need to actively carry out 
international cooperation activities, to what extent cooperation 
must be extended, and effective implementation measures. 
 
In carrying out international peace cooperation activities, close 
cooperation with the United States will remain vital. The two 
countries have worked closely in all areas. 
 
Strictly speaking, international peace cooperation would be on a 
different plane from Japan-US cooperation that is premised on an 
armed attack on either of them in Japanese territories under the 
US-Japan Security Treaty. It is desirable for the two countries to 
conclude an international cooperation activities treaty. The US, 
however, does not intend to do so at present. 
 
Over the last half-century, Japan-US security relations have always 
moved forward under the leadership of the United States, and Japan's 
defense capability has also been improved to complement US forces. 
The time has come for Japan to play a central role in conducting 
international cooperation activities in the Asia-Pacific region and 
the United States to assist Japan. 
 
The two countries should also cooperate with Australia in a wide 
range of areas, such as international peace-building, search and 
rescue, disaster relief, communicable disease relief, humanitarian 
and reconstruction assistance, antiterrorism measures, 
nonproliferation of weapons of mass destruction, free navigation in 
sea lanes, guarding, surveillance, logistical support, and 
information exchanges. 
 
It would be desirable for a large number of countries, including 
ASEAN, China, and India in addition to Japan, the United States, and 
Australia, to conclude multilateral peace cooperation agreements to 
engage in exercises and activities. 
 
The United States is trying to build a strategic base system with 
its bases in Guam. Japan should lease US base facilities to make 
them into a forward base to be used in training, servicing, and 
stockpiling by the SDF in conducting international cooperation 
activities in the Asia-Pacific. The joint use of facilities in 
Tinian, Micronesia, the Mariana Islands, the northern part of 
Australia, Guam, and Okinawa is also worth considering. The 
deployment of SDF troops to such areas would require additional 
status of forces agreements that would entail international 
cooperation agreements. 
 
TOKYO 00000259  003 OF 007 
 
 
 
In order for the SDF to smoothly carry out international cooperation 
activities overseas, the government must resolve the question of 
exercising the right to collective self-defense, establish a 
permanent law specifying general standards for deploying SDF troops 
overseas, and determine grounds, Diet procedures, arms criteria, and 
specific activities, as well. Many players besides the SDF must also 
join international cooperation activities, such as ODA (official 
development assistance) funds, nongovernmental organizations (NGOs), 
and nonprofit organizations (NPOs). But that would require the 
establishment of a basic international peace cooperation law. 
 
Needless to say, the SDF's primary duty is to defend the homeland, 
sovereignty, the state, and its people. That duty must come before 
international cooperation. In my view, Japan's defense capabilities 
are hardly sufficient to defend the state. Objectively speaking, the 
severe environment surrounding East Asia would not allow Japan to 
reduce its defense capabilities. International cooperation 
activities and Japan-US alliance cooperation would increase SDF 
roles, duties, and functions. People, not the state, would be held 
responsible for the outcome of the paradoxical combination of 
increasing SDF rules and duties on the one hand and reducing defense 
capabilities on the other. 
 
Although it was good that international cooperation activities have 
been upgraded to primary duties, the country's defense capabilities 
are far from sufficient to conduct them effectively. The government 
must resolutely enact necessary policies and laws. 
 
(3) Editorial: Bid-rigging involving Land, Infrastructure and 
Transport Ministry; Time for investigative officials to step in 
 
ASAHI (Page 3) (Full) 
January 19, 2007 
 
To no one's surprise, the Ministry of Land, Infrastructure and 
Transport Ministry (MLIT) was found to be involved in big-rigging 
activities. 
 
MLIT receives lists of expected successful bidders for river 
floodgate construction projects from coordinators of the civil 
engineering industry and gives approvals. At times it handpicked 
successful bidders or issued the so-called "voices form heaven" 
orders through former ministry officials. 
 
This is the language used by the Fair Trade Commission (FTC) to 
describe how MLIT carried out bid-rigging activities. The FTC has 
decided to apply the Law for the Prevention of Collusive Bidding at 
the Initiative of Government Officials for the first time to a 
central government agency. It will convey to MLIT that the 
Commission found it to have been involved in the bid-rigging 
activities in question and order that the ministry correct the 
situation. 
 
MLIT is in charge of a 5.6 trillion yen budget for public works 
projects. This is 80% of the entire government budget for public 
works. It is also granted with the authority to prevent bid-rigging 
activities by other government agencies and local governments. It is 
outrageous that the watchdog itself has broken the law. 
 
Bureaucrat-led bid-rigging activities have been successively 
discovered since the 1993 corruption cases involving general 
construction contractors. Following these cases, the preventive law 
 
TOKYO 00000259  004 OF 007 
 
 
was established. And yet, MLIT did not stop engaging in bid-rigging 
practices. This fact indicates how deeply its bid-rigging activities 
had taken root. 
 
Behind this situation is the practice that retired MLIT officials 
land jobs at companies, which they previously used to regulate. In a 
bid-rigging scandal for projects sponsored by the Defense Facilities 
Administration Agency, the Tokyo High Court sentenced a former 
technical councilor to one year and six months in prison, noting, 
"The defendant wasted a large amount of money in exchange for 
securing post-retirement jobs for officials." 
 
Most of the 20 companies that occupied the upper echelon of the list 
of successful bidders for MLIT-sponsored floodgate construction 
projects had agreed to hire retired MLIT officials. As long as such 
a collusive structure between the bureaucracy and the private sector 
is in place, the problem will never be solved. We suggest that the 
practice of retired senior officials landing cushy jobs in related 
private companies should be banned. 
 
Even so, there are some points that cannot be understood. 
 
The FTC found only two officials - an assistant division director of 
MLIT and a control officer of the Kinki Regional Construction 
Bureau, who is already dead -- were involved in the bid-rigging 
activities involving the floodgate construction projects. It is 
hardly likely that they were the only persons involved in the series 
of bureaucrat-led bid-rigging activities. Were their predecessors or 
superiors unaware of such activities? Isn't it the case that the 
entire organization was involved in the activities? 
 
In another floodgate construction work, a former executive advisory 
engineer who was in the top position among technical officials, and 
the former chief of the Geographical Survey Institute were the only 
persons who are suspected of being involved. It is said that since 
the two became involved in the activities after they retired from 
MLIT, the law cannot be applied to them, because it targets only 
incumbent government officials. However, isn't there a possibility 
of their having been involved before retirement, too? 
 
The FTC must unravel the full extent of all those cases. 
 
This law is dubbed a loophole law, because it only leaves the 
prevention of bid-rigging practices up to the project sponsors' 
self-initiative. It was not until last December that a criminal 
punishment clause was incorporated. This regulation will not be 
applied this time. 
 
If the FTC claims that it is impossible for it to pursue the case 
any further, since the criminal punishment is not to be applied, it 
can file a criminal complaint with public prosecutors. Public 
prosecutors have thus far cracked down on bureaucrat-led bid-rigging 
activities applying the complicity rule under the Anti-Monopoly Law 
and the regulation that bans blocking open public bidding under the 
criminal law, without solely adhering to the Law for the Prevention 
of Collusive Bidding at the Initiative of Government Officials. 
 
The FTC should not leave the investigation into the case up in the 
air, just because the concerned law is limited in what it can do. 
 
(4) Abe administration (Part 2): Support organizations unable to 
gauge distance with LDP 
 
 
TOKYO 00000259  005 OF 007 
 
 
NIHON KEIZAI (Page 2) (Full) 
January 17, 2007 
 
"This year is the year of political battles," said Liberal 
Democratic Party (LDP) Secretary General Hidenao Nakagawa at a LDP 
board meeting on Jan. 16. The LDP's action plan to be revealed at 
its annual convention tomorrow sets the strengthening of exchanges 
with main support organizations as the top priority to expand party 
strength. 
 
Toranosuke Katayama, secretary general of the LDP caucus in the 
House of Councilors, met on Dec. 8 last year with senior members of 
the designated post office heads across the country. The LDP cut 
last year its ties with Taiju, a political organization composed of 
retired special postmasters, because then Prime Minister Junichiro 
Koizumi asked for the people's vote of confidence in the propriety 
of his postal privatization plan in the House of Representatives 
election. With an eye on the upcoming House of Councilors election, 
Katayama has been looking for the possibility of repairing its 
relations with Taiju. 
 
About 110,000 Taiju members used to support the LDP, but the number 
has now decreased to 6,000. A senior member of the designated 
postmasters association adamantly said: "It is difficult to 
reconcile the relationship by just one meeting. We are determined to 
support individual politicians not the party in elections." The 
postmasters association is also concerned about such problems as 
downsizing. It is now mulling which party or politician it will 
invite to its convention to be held in May in Hiroshima. 
 
At a press conference on Jan. 10, Japan Medical Association 
President Yoshihito Karasawa criticized reform of the medical 
system, saying, "Since the medical system has been reformed based on 
the policy of attaching priority to the nation's financial 
situation, various problems have come up in medical institutions." 
He had the reforms in the healthcare sector in April 2008 firmly in 
mind when he said that. 
 
Karasawa called on Secretary General Nakagawa and General Council 
Chairman Yuya Niwa early in January. Haruo Uematsu, Karasawa's 
predecessor, was forced to accept the largest ever cut in payments 
to medical institutions, and he remained at odds with the Koizumi 
government. Karasawa, therefore, has been working on improving the 
JMA's ties with the government since he assumed the presidential 
post last spring. 
 
An LDP lawmaker in the health and welfare policy clique in the Diet 
predicted: "It would be difficult to obtain 200,000 votes from JMA. 
In addition to the fact that the JMA presidential election left an 
ill feeling, a political support organization set up last year by 
dental technicians and occupational therapists has backed another 
LDP candidate than the one the party desired. The LDP cannot expect 
to obtain the several tens of thousands votes that JMA controls. 
 
At a meeting of an organization of construction affiliated companies 
on Jan 4 in Niigata City, a senior organization official told 
Nobuaki Sato, former administrative vice minister of land, 
infrastructure and transport, who will run in the Upper House 
election: "Large urban areas are enjoying the economic boom. But the 
social divide is clear between the urban and rural areas." Although 
the senior official was enthusiastic about making specific requests 
of the Abe administration, there was a cold mood in the construction 
industry. The Associated General Constructors of Japan, Inc. member 
 
TOKYO 00000259  006 OF 007 
 
 
companies decreased by about 5,000 over the past five years of the 
Koizumi government. One Upper House member grumbled about a decline 
in the organizational power, saying, "Setting aside cooperate 
managers, rank-and-file workers do not work for politicians." 
 
The LDP and its support organizations are trying to come cross 
again. The main opposition party, Minshuto (Democratic Party of 
Japan), however, aims at slicing down the LDP support groups, by 
using such tactics as the fielding of a former senior member of the 
Junior Chamber of Commerce. 
 
A senior LDP member made this cold comment: "The time when a 
candidate backed by an industrial organization can secure up to one 
million votes has ended." 
 
(5) Scramble for natural resources - Part 10 (conclusion): 
Development of gas fields lies as thorn in Japan-China relations; 
Doubts cast over "early joint development" 
 
YOMIURI (Page 9) (Excerpts) 
January 18, 2007 
 
Prime Minister Abe and Chinese Premier Wen agreed in their meeting 
on Jan. 14 in the Philippines to accelerate a solution of the issue 
of gas-field development in the East China Sea, focusing on "joint 
development." But few people take the agreement at face value. A 
senior officer of the Ministry of Economy, Trade and Industry (METI) 
grumbled: "The situation has not changed. It has been decided that 
China will make a proposal, but even the date for the next round of 
bureau-director-level talks has yet to be set. The thorn has not 
been removed." 
 
The issue of gas-field development in the East China Sea is a thorn 
in relations between Japan and China. China has developed a gas 
field on the western side of the Japan-claimed median line 
separating the Japanese and Chinese exclusive economic zones (EEZ). 
China might exploit the natural resources on the Japanese side of 
the median line. 
 
In the sixth round of Japan-China bureau director-level talks at the 
Diaoyutai State Guesthouse in Beijing on July 8 of last year, Japan 
called on China to stop the ongoing development until the two 
countries agreed on joint development. Participating in the talks 
were Foreign Ministry Asian and Oceanian Affairs Bureau Director 
General Kenichiro Sasae and (then) Resources and Energy Agency 
Director General Yorinobu Kodaira. 
 
In response to Japan's request, Chinese Foreign Ministry's Asian 
Affairs Department Director General Hu Zhengyue repeated China's 
usual reply, "China is carrying out development in Chinese waters 
that are not under dispute by Japan," indicating an unwillingness to 
enter into discussion on specifics. Representatives from the 
National Development and Reform Commission were only there taking 
notes without making any statements. 
 
In the talks that started in October 2004, Chinese officials have 
always made the same remarks. A Japanese negotiator vented, "They 
probably have received instructions from higher-ranking officials. 
None of the Chinese participants had any intention to seriously 
negotiate the issue." 
 
Japan and China launched an energy struggle in 2004, triggered by 
newspaper reports about China's starting to develop the Chunxiao gas 
 
TOKYO 00000259  007 OF 007 
 
 
field on the Chinese side several kilometers from the median line. 
 
China started a survey of natural resources in the East China Sea in 
the early 1970s. In November 1998, the nation constructed a mining 
facility on the Pinghu Oilfield. Though obtaining information about 
such moves by China, the Japanese government took no response 
measures. The government's idleness resulted in allowing China to 
create a fait accompli. 
 
In a press conference in June 2004, then METI Minister Nakagawa 
expressed concern, saying, "China could be infringing on Japan's 
rights," highlighting the problem of China's oilfield development 
for the first time. 
 
China has stopped exports of oil to Japan from the Daqing Oilfield 
after 31 years. This was because Japan rejected China's price-hike 
notice. In a project to develop the Tang Natural Gas Field in 
Indonesia, Mitsui & Co. prepared to buy some concessions, but China 
National Offshore Oil Corp. (CNOOC) purchased the rights prior to 
Mitsui. 
 
With relations between Japan and China improving under the Abe 
administration, a mood is prevailing that may lead to an easing of 
their standoff over energy. 
 
METI Minister Amari visited China last December and agreed with 
China to set up a panel in order for Japan to transfer its 
energy-saving technologies to China. Just after the agreement, a 
Japan-China energy-saving and environment business promotion panel 
was established. A total of 220 steel, auto, electricity and trade 
companies have joined this council. 
 
China International Affairs Research Institute Professor Hsia Yishan 
said: "Once relations between Japan and China are improved, the 
issue of gas fields in the East China Sea will fizzle out. The issue 
is the mirror of Japan-China relations." 
 
China appears to be aiming to pigeonhole the gas field problem by 
promoting bilateral cooperation in the energy-saving and environment 
areas. Energy relations between Japan and China are dual in 
structure with a serious row hidden behind a veneer of friendship. 
 
SCHIEFFER