VZCZCXRO6261
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #4666/01 2770808
ZNR UUUUU ZZH
P 040808Z OCT 07
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 8263
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/USFJ //J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/CTF 72
RUEHNH/AMCONSUL NAHA 5961
RUEHFK/AMCONSUL FUKUOKA 3549
RUEHOK/AMCONSUL OSAKA KOBE 7208
RUEHNAG/AMCONSUL NAGOYA 2463
RUEHKSO/AMCONSUL SAPPORO 4270
RUEHBJ/AMEMBASSY BEIJING 9344
RUEHUL/AMEMBASSY SEOUL 5399
RUCNDT/USMISSION USUN NEW YORK 6259

UNCLAS SECTION 01 OF 12 TOKYO 004666 
 
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 10/04/07 
 
 
Index: 
 
(1) US deputy director of operations: "We'll make efforts to 
disclose information about vessels that have received MSDF's 
refueling services" (Yomiuri) 
 
(2) High-level official of US Central Command on MSDF refueling: "We 
were not given instructions that it was to be used only for OEF" 
(Mainichi) 
 
(3) Government again seeks justification for refueling operations 
(Asahi) 
 
(4) Interview with Foreign Minister Masahiko Komura: Ruling camp 
will discuss issue of continuing refueling mission in fair and 
square manner (Tokyo Shimbun) 
 
(5) Interview with Defense Minister Ishiba: Suspension of MSDF 
refueling will cause trouble to other countries (Tokyo Shimbun) 
 
(6) Editorial: Prime minister's Diet reply on refueling mission 
disappointing (Asahi) 
 
(7) Tug-of-war between LDP, DPJ ahead of questioning sessions by 
party representative (Tokyo Shimbun) 
 
(8) Editorial: Can DPJ show capability to run government? (Nikkei) 
 
(9) Editorial: Can North Korea keep its promises as mentioned in the 
six-party agreement? (Tokyo Shimbun) 
 
(10) Editorial: Consideration must be given to ordinary shareholders 
in triangular mergers (Nikkei) 
 
ARTICLES: 
 
(1) US deputy director of operations: "We'll make efforts to 
disclose information about vessels that have received MSDF's 
refueling services" (Yomiuri) 
 
YOMIURI ONLINE NEWS (Full) 
October 4, 2007, 11:08 a.m. 
 
Aya Igarashi, Washington 
 
Robert Holmes, deputy director of operations for US Central Command, 
was asked yesterday about the possibility that Japan's Maritime 
Self-Defense Force (MSDF) might have indirectly refueled a US 
carrier that was engaged in the Iraq campaign and made this comment: 
"I am well aware that that matter has been a topic for debate in 
Japan. We on the part of US military officials will work together 
with Japan so as to provide reliable information to Japan." Holmes 
emphasized his intention to make efforts to disclose information 
about activities of the vessels that have received refueling 
services. 
 
When asked whether there have been cases of vessels being refueled 
indirectly, Holmes said: "I do not say information showing such 
cases does not exist but I am saying I don't know." In response to a 
question asking whether there was any specific order prohibiting 
fuel provided by the MSDF from being converted for the Iraq war, 
Holmes said only this: "I don't know." 
 
TOKYO 00004666  002 OF 012 
 
 
 
(2) High-level official of US Central Command on MSDF refueling: "We 
were not given instructions that it was to be used only for OEF" 
(Mainichi) 
 
MAINICHI ONLINE NEWS (Full) 
October 4, 2007, 11:08 a.m. 
 
Hiroaki Wada, Washington 
 
Robert Holmes, deputy director of operations for US Central Command, 
yesterday met with the press in Washington, and when asked whether 
an order has been issued that US vessels that receive refueling 
services from Japan's Maritime Self-Defense's (MSDF) vessels in the 
Indian Ocean should be limited to those vessels that would 
participate in Operation Enduring Freedom (OEF), Holmes said, "I am 
not aware of such an order." The MSDF has provided oil mostly to US 
vessels, but criticism has been made that the oil provided might 
have been diverted to the Iraq war. 
 
In reference to the question of diversion, Holmes said: "I know it 
has become a topic for debate in Japan. I am also aware of the 
importance of the issue." Noting that information about fuel 
provided by the MSDF "should be made open to the public and should 
not be made an issue (between Japan and the US)," Holmes indicated 
his intention to transmit relevant information in detail to the 
Japanese side. 
 
On Japan's refueling operations, Holmes commented, "They are very 
important, and nations (participating in OEF) have appreciated 
them." While saying, "As a serviceman, I should refrain from making 
any comment on a political debate in each country as to what should 
be provided in (the war on terrorism)," Holmes expressed a strong 
hope that Japan will continue its mission. 
 
The US Central Command is responsible for military operations going 
on in Iraq, Afghanistan, and their nearby areas. 
 
(3) Government again seeks justification for refueling operations 
(Asahi) 
 
ASAHI (Page 3) (Abridged) 
October 3, 2007 
 
The war on terrorism, now underway in and around Afghanistan by the 
US-led coalition of the willing, was launched by the United States 
in "self-defense" following 9/11. At that point, Japan did not have 
any legislation to provide rear-area support for such a war. Japan 
established in 2001 the Antiterrorism Special Measures Law, a 
time-limited law, based on a UN Security Council resolution. The UN 
resolution, however, does not directly refer to the operations in 
which Japan is taking part. The government is studying new 
legislation despite the fact that the Democratic Party of Japan 
(Minshuto or DPJ) and other parties are skeptical about the validity 
of the Maritime Self-Defense Force's refueling operations in the 
Indian Ocean. Legal grounds for the refueling mission are likely to 
remain as the main point of contention regarding the new 
legislation, as well. 
 
UN forced to express appreciation 
 
The government is allowed to dispatch SDF troops overseas under the 
 
TOKYO 00004666  003 OF 012 
 
 
UN Peacekeeping Operations (PKO) Cooperation Law. But the Operation 
Enduring Freedom - Maritime Interdiction Operations (OEF-MIO) in the 
Indian Ocean, in which the MSDF is taking part, are not peacekeeping 
operations. The OEF is America's war on the Al Qaeda and other 
terrorist groups that are responsible for 9/11. The government needs 
different legal justification for dispatching the SDF to provide 
logistical support. 
 
The government enacted the Antiterrorism Law in 2001 based on UN 
Security Council Resolution 1368. The resolution, condemning 9/11 as 
a threat to international peace and security, expresses the Security 
Council's readiness to take all necessary steps to respond to the 
attack. Based on this resolution, the government played up the need 
to dispatch SDF troops, saying that the UN members were required to 
take appropriate antiterrorism measures. 
 
The government used the UN resolution as a desperate step to give 
validity to the OEF, which is not a UN operation. However, as it was 
adopted before the start of the OEF, the resolution does not 
specifically refer or give a seal of approval to the OEF. 
 
Aiming to extend the refueling operations, the government and ruling 
parties lobbied the United States and other countries, and as a 
result, the UN Security Council adopted this past September 
Resolution 1776 that refers to the OEF. 
 
In his meeting with US Secretary of State Condoleezza Rice in 
Washington on Sept. 27, Foreign Minister Masahiko Komura expressed 
gratitude for US cooperation for the adoption of Resolution 1776 
that expresses appreciation for the OEF maritime interdiction 
operations. 
 
Appreciation is mentioned in the preface to the resolution, not in 
the body, however. A UN source took this view: "Usually, words of 
gratitude in a resolution are not taken to mean UN authorization." 
 
Shortly after abstaining from the vote on Resolution 1776, the 
Russian Foreign Ministry released a statement ascribing its 
abstention to a lack of explanation on the grounds for the MIO by 
the United States and other countries, making it clear that the MIO 
is outside the UN framework. 
 
The government yesterday presented an outline of new legislation to 
the ruling parties for the continuation of the refueling operations. 
The government plans to add Resolution 1776 expressing appreciation 
for the OEF to the legal grounds for the MSDF mission that already 
include Resolution 1368. 
 
DPJ: Resolution 1776 is not UN authorization 
 
Ozawa in a press conference yesterday argued that Resolution 1776 
cannot justify the refueling operations, saying: "The resolution is 
not about (authorizing the maritime interdiction operations) as UN 
operations. It simply includes words of gratitude (for the 
operations)." This comment comes from his view that although the 
resolution expresses appreciation for the OEF, the maritime 
interdiction operations still fall outside the UN framework. 
 
In a press conference in August, Ozawa also said: "The war in 
Afghanistan is America's war that was started by President Bush. It 
is different in nature from the operations authorized by a UN 
Security Council resolution." His logic is that the MSDF's 
 
TOKYO 00004666  004 OF 012 
 
 
logistical support to the war on terrorism, which was launched by 
the United States in self-defense, clearly constitutes an exercise 
of the right to collective self-defense, which is prohibited under 
the Constitution. In yesterday's news conference, Ozawa reiterates 
his opposition, describing the refueling operations as assistance to 
the US military operations. 
 
Ozawa also thinks Japan is legally allowed to join the International 
Security Assistance Force (ISAF), a NATO-led international security 
ground force established based on Resolution 1386. 
 
ISAF, however, is not engaged in UN peacekeeping operations but 
involves military actions against the Taliban and other 
antigovernment forces. Ozawa told visiting German Chancellor Merkel 
in late August that he did not necessary agree with the ISAF's 
activities. 
 
The DPJ is determined to focus on uncovering facts about the 
refueling operations by exercising investigative powers in national 
politics, while endeavoring to come up with counterproposals mainly 
for improving the people's livelihood in contrast to the 
government's new legislation. 
 
(4) Interview with Foreign Minister Masahiko Komura: Ruling camp 
will discuss issue of continuing refueling mission in fair and 
square manner (Tokyo Shimbun) 
 
TOKYO SHIMBUN (Page 2) (Full) 
October 3, 2007 
 
-- The government has nearly finalized an outline for new 
legislation to extend the Maritime Self-Defense's (MSDF) refueling 
mission in the Indian Ocean. What approach is the ruling camp going 
to take in talks with the Democratic Party of Japan (DPJ)? 
 
There will be no other way but to explain that the continuation of 
the mission has been requested by the international community and is 
also in Japan's national interests. It is impossible to change the 
other side's views by hypnotizing it. We will discuss the issue in a 
sincere and fair manner. 
 
-- Do you think it will be unavoidable to take another vote on an 
antiterror bill in the House of Representatives if the DPJ refuses 
to offer cooperation? 
 
We acknowledge that there could be the possibility constitutionally 
as a last resort, but that is not the best solution. We will 
continue to make desperate efforts to have the people and the 
opposition camp understand and have the bill passed in the Diet in a 
peaceful way, though it might be difficult objectively. 
 
-- Regarding the period of the MSDF operation, which do you think is 
desirable, one year or two years? 
 
For stable (activities), the period of two years is more desirable 
than one year. 
 
-- How do you evaluate the draft agreement reached at the latest 
six-party talks on North Korea's denuclearization? 
 
That is the first step in the "second phase." Although I do not 
think the agreement is satisfactory, one-step forward would be 
 
TOKYO 00004666  005 OF 012 
 
 
better than nothing. 
 
-- The government intends to extend its economic sanctions against 
North Korea. What do you think about a balance between dialogue and 
pressure? 
 
Regardless of who is in power, the key point is how North Korea will 
change its posture. Since the problem over which Japan decided to 
apply sanctions on North Korea has yet to be dissolved, it is 
necessary for Japan to extend its sanctions. If North Korea changes 
itself in a favorable way, Japan may lift the sanctions. 
 
-- Prime Minister Yasuo Fukuda is scheduled to visit China. Will a 
settlement of the issue of gas field development in the East China 
Sea be the premise for the visit? 
 
If a complicated, difficult issue is resolved, the people will be 
convinced that Japan and China are in strategic mutually-beneficial 
relations. If the issue is left unresolved, it might be difficult to 
establish such relations in a comprehensive way. Resolving this 
issue is extremely important. Even so, it does not mean that unless 
this issue is resolved, the prime minister will not go to China. 
 
-- A Japanese journalist was shot to death in Burma. Following this 
news, what response does the government plan to make to the military 
junta? 
 
We must be upset at such an incident, but anger alone is not enough. 
We will consider what is needed in order to spread democratization 
in that nation. 
 
(5) Interview with Defense Minister Ishiba: Suspension of MSDF 
refueling will cause trouble to other countries (Tokyo Shimbun) 
 
TOKYO SHIMBUN (Page 2) (Full) 
October 4, 2007 
 
-- What effect a suspension of the Maritime Self-Defense Force's 
(MSDF) refueling operations in the Indian Ocean will have? 
 
Ishiba: It is extremely significant that Japan is provided with 
high-performance supply ships while various countries have been 
managing with only a few vessels. Should Japan suspend the MSDF 
refueling operation, it will greatly affect other countries. We 
should be aware of this. 
 
-- New legislation enabling the MSDF to continue its refueling 
mission does not require Diet approval. Don't you think that such 
would lead to retreat from civilian control? 
 
Ishiba: The present Antiterrorism Special Measures Law specifies 
such measures as refueling, transportation, and search-rescue 
operations; and the law stipulates that the cabinet will decide 
which measures should be provided; and Diet approval is necessary 
when activities start. The new legislation specifies what measures 
the MSDF will offer. Most measures in the basic plan will be 
included in a new antiterrorism law. With the enactment of new 
legislation, Diet involvement will be guaranteed. 
 
-- The Democratic Party of Japan has opposed Japan's refueling 
mission itself. 
 
 
TOKYO 00004666  006 OF 012 
 
 
Ishiba: I have never heard the DPJ's clear reason for its opposition 
to the refueling operation. 
 
-- How will you find common ground with the DPJ? 
 
Ishiba: If the maritime refueling operation violates the 
Constitution as the DPJ asserts, we will need to debate whether the 
Constitution should be amended. If something should be done to 
continue the refueling mission, it would be possible to make a (new) 
law. I hope that the DPJ will think deeply about why Japan decided 
to send the MSDF to the Indian Ocean. 
 
-- Can you shed light on the alleged diversion of fuel provided by 
the MSDF for use in the Iraq war? 
 
Ishiba: As the defense minister, I ordered an investigation of the 
777 refueling operations. My ministry is now analyzing in particular 
the fuel provided to a supply ship (in question). I want to fulfill 
my accountability for this before the start of Diet deliberations 
(on the new legislation). 
 
-- How will you negotiate with Okinawa on the government's Futenma 
Air Station relocation plan? 
 
Ishiba: The present government's plan to build two runaways in a 
V-shape is the best, but the basic policy will not be pushed forward 
without local understanding. (In order to obtain understanding and 
cooperation from local residents) I think I should visit Okinawa as 
early as possible. 
 
(6) Editorial: Prime minister's Diet reply on refueling mission 
disappointing (Asahi) 
 
ASAHI (Page 3) (Full) 
October 4, 2007 
 
Debate finally kicked off in the Diet about 20 days after former 
Prime Minister Abe's sudden announcement of his resignation. The air 
in the representative interpellation session held in the House of 
Representatives on the first day was unusually full of tension, 
reflecting the current state of the reversal of strengths between 
the ruling and opposition camps in the House of Councillors. Both 
the ruling and opposition parties are expected to conduct heated 
discussion. 
 
In the interpellation session, Prime Minister Fukuda has already 
disappointed us with his reply on the issue of extending the 
Maritime Self-Defense Force's (MSDF) refueling mission in the Indian 
Ocean. 
 
Democratic Party of Japan (DPJ) Secretary General Yukio Hatoyama 
demanded that the government should disclose information on the 
actual state of the refueling operation. In response, the prime 
minister gave this curt reply: "The Defense Ministry is making 
efforts to enable disclosing information as much as possible, while 
obtaining the understanding from countries concerned." 
 
To be sure, the refueling operation is connected with other 
countries' military operations. There might be tips which Japan 
cannot disclose based on its judgment alone. Even so, it is hard to 
see that the Defense Ministry is eager to disclose information. 
 
 
TOKYO 00004666  007 OF 012 
 
 
The prime minister promised in his policy speech to discuss key 
tasks with the opposition camp in a sincere manner. But sincerity 
cannot be detected from his Diet replies. 
 
The allegation has come up that fuel supplied to United States' 
warships by the MSDF was used in the Iraq war, deviating from the 
purpose of the Antiterrorism Special Measures Law. A Japanese civic 
group has obtained data of the US Navy based on the US 
information-disclosure system. This data increases the suspicion. 
 
After checking, the government changed the amount of fuel provided 
to US supply vessels in the Indian Ocean in February 2003 from the 
initially announced 200,000 gallons to 800,000 gallons. 
 
The fuel provided by the MSDF was supplied to USS Kitty Hawk. The 
aircraft carrier is now heading toward Iraq to engage in a 
monitoring operation. The government used to explain that the 
diversion of the oil for use in Iraq was inconceivable because 
200,000 gallons is equivalent to one day's consumption by a refueled 
carrier. The grounds for this reply have now collapsed. 
 
Asked about the correction, the prime minister replied: "It was a 
clerical error." Then how can he explain about the possibility of 
diversion? If proved true, this is a far more serious error than the 
clerical error. 
 
The government inserted the following view into its written reply: 
The governments dispatching the warships refueled by the MSDF 
determine what operations the ships should carry out after refueled, 
so the Japanese government has no future details. Such would seem to 
be a defiant attitude. 
 
The government enacted the Iraq Special Measures Law, which strictly 
restricts the duties and areas of activities of SDF troops, but only 
after severe debate was conducted in the Diet. The law does not 
authorize any refueling operations at sea. If the diversion of fuel 
for use in Iraq is proved true, the refueling operation will 
constitute a serious offense. 
 
The amount of MSDF-provided fuel increased when the Iraq war broke 
out. Moreover, more than 60 PERCENT  of the MSDF-refueled US naval 
ships were replenishment tankers. 
 
When SDF troops are dispatched overseas, the government naturally 
should restrict their activities under law, and the Diet naturally 
should be informed of the actual state of their activities. That is 
indisputably the way postwar democracy should be. 
 
The prime minister must properly provide answers to the allegation 
on the refueling operation. The government is preparing new 
legislation that would restrict the MSDF's activities to refueling, 
but the first thing it should do is to reveal the true state of the 
ongoing MSDF activities. 
 
(7) Tug-of-war between LDP, DPJ ahead of questioning sessions by 
party representative (Tokyo Shimbun) 
 
TOKYO SHIMBUN (Page 2) (Full) 
October 3, 2007 
 
Prior to the start of questioning session by party representatives 
today at the Lower House, a tug-of-war moved into full swing between 
 
TOKYO 00004666  008 OF 012 
 
 
the ruling Liberal Democratic Party (LDP) and the main opposition 
Democratic Party of Japan (DPJ or Minshuto). Although the LDP has 
asked the DPJ to hold prior consultations, the largest opposition 
party has submitted to the Diet its own bills in succession without 
regard to the LDP's request. 
 
The LDP's management of Diet affairs has now completely changed from 
the hard-line stance it took in the regular session before the July 
Upper House election. The party has proposed to the DPJ the setting 
up of a consultative organ before bills are presented to the Diet. 
The LDP's aim is to find the middle ground through prior 
consultations, as well as to proceed with Diet deliberations 
smoothly. 
 
Although the LDP has yet to get favorable answers from the DPJ, it 
continues to take a low profile. At yesterday's press conference, 
LDP Diet Affairs Committee Chief Deputy Chairman Kenji Kosaka 
pointed out that the "practice" under which the LDP used to explain 
to the opposition camp the contents of a bill it had sponsored still 
exists. 
 
The LDP also has proposed establishing a consultative body made of 
representatives of the two parties before submitting bills on 
appointments, which require approval of the two Diet chambers. This 
is because since there is no provision that the Lower House can take 
a vote twice on a bill on appointments of committee posts, if the 
DPJ votes against the bill, it would hit a roadblock. A senior LDP 
Diet Affairs Committee member stressed: "The DPJ, the largest party 
in the Upper House, should bear some responsibilities." 
 
The DPJ remains completely indifferent to the LDP's request of 
setting up a consultative organ, with one senior Diet Committee 
member saying, "We will not be engaged in such collusion." The party 
intends to reject the LDP's requests. The chairmen of four 
opposition parties reached agreement in a meeting yesterday that 
their parties will line up in favor of refusing the LDP's 
entreaties. 
 
The DPJ continues to submit its own bills to the Upper House, where 
the opposition camp holds a majority. The party submitted yesterday 
a bill to give aid to hepatitis patients. The DPJ's strategy is to 
adopt first at the Upper House bills that would be easily accepted 
by the public, and send them to the Lower House, in order to 
undermine the ruling coalition's situation. 
 
The DPJ has submitted five bills so far to the Upper House. The 
outlook is that the party will ultimately submit 11 bills. 
 
The main opposition party initially planned to submit several bills 
to the current session because its Upper House members had little 
experience in Diet debate. However, when Ozawa instructed that 
presenting their own bills is important, the party has shifted its 
initial plan. The party has decided to submit bills related to 
pension issue, child-rearing, and agriculture, which were included 
in its manifesto for the July Upper House election. 
 
The party has calculated that if will be able to gain popularity if 
it submits bills soon after the Upper House election. The DPJ's move 
is in response to a sense of alarm against the LDP's request for 
prior consultations. 
 
DPJ Secretary General Yukio Hatoyama commented on the LDP's request 
 
TOKYO 00004666  009 OF 012 
 
 
for prior consultations with his party: "If discussions go well, the 
LDP will get the credit; and if unsuccessful, the opposition will 
have to bear responsibility." The party thinks that holding prior 
consultations will give the public the impression of opaque 
deal-making. Therefore, the party intends to debate the LDP in the 
Diet, refusing prior consultations. 
 
(8) Editorial: Can DPJ show capability to run government? (Nikkei) 
 
NIKKEI (Page 2 (Full) 
October 4, 2007 
 
With the start of an interpellation session following Prime Minister 
Yasuo Fukuda's policy speech, debates between the ruling and 
opposition camps have moved into full swing in the Diet, where the 
opposition is dominant in the Upper House. Yukio Hatoyama, Secretary 
General of the Democratic Party of Japan (DPJ or Minshuto), made his 
confrontational stance clear in pursuit of an early dissolution of 
the Lower House and a snap election. Prime Minister Fukuda, who took 
the podium for the first time as prime minister, warded off 
Hatoyama's demand for a Diet dissolution in a matter-of-fact tone 
and repeatedly called on the DPJ to respond to his call for talks 
with the ruling camp in order to protect people's lives and national 
interest. 
 
The DPJ is no longer just an opposition party. It won a landslide 
victory in the July Upper House election. It has the power to reject 
all bills submitted by the government and the ruling camp in the 
Upper House. If it becomes a top party in the next election, it 
could take the reins of government. It should not forget that its 
capability to run the government is being tested in the current Diet 
session. 
 
President Ozawa should have taken the podium in the session, the 
first stage for full-scale Diet debates since the Upper House 
election, and directly appealed why a change of administration is 
needed, explaining the DPJ's policy and its Diet approach fairly and 
squarely. It was anticlimactic that he avoided asking questions. 
 
Regarding the Fukuda cabinet's policy of cooperating with the 
opposition, Hatoyama noted, "The DPJ cannot accept collusive, 
behind-doors talks with the ruling camp." He also reiterated the 
stance of continuing to oppose a continuation of refueling 
operations by the Maritime Self-Defense Force in the Indian Ocean, 
the focus of highest attention in the current Diet session. As 
reasons for that, Hatoyama cited (1) that the refueling operation is 
not based on a UN resolution; and (2) that there is no clear exit 
strategy due to the deteriorated situation in Afghanistan. 
 
Ozawa during a press conference on Oct. 2  indicated a hard-line 
stance, saying, "Since our position is that the continuation of the 
refueling services is not allowed under the Constitution, there is 
no room for talks," Whether the DPJ's assertion is persuasive or not 
is questionable. We must not lose a viewpoint regarding whether an 
option to end the refueling operation would be in the interest of 
Japan, though it is necessary to deepen Diet discussion of the 
reality of the refueling operations. 
 
The DPJ has submitted many bills, including a bill prohibiting the 
diversion of pension premium funds, a bill amending the Natural 
Disaster Victims' Relief Law, a bill amending the Law Assisting 
Disabled Persons' Independence, to the current Diet session, saying 
 
TOKYO 00004666  010 OF 012 
 
 
that it will realize policies it pledged to the public during the 
Upper House election campaign. These bills might be adopted in the 
Upper House, but they cannot be passed into law if the LDP does not 
support them. If the DPJ seriously wants to secure Diet approval for 
those bills, talks with the ruling parties would become unavoidable 
sooner or later. 
 
The DPJ has pledged that it would uncompromisingly pursue wasteful 
spending of tax money in the Diet and explain funding resources to 
realize the pledges it made to the public. It is also necessary to 
closely examine whether it is possible to really materialize a basic 
pension system, based on a system fully funded with tax money 
without hiking the consumption tax. 
 
(9) Editorial: Can North Korea keep its promises as mentioned in the 
six-party agreement? (Tokyo Shimbun) 
 
TOKYO SHIMBUN (Page 5) (Full) 
October 4, 2007 
 
A roadmap has been set for North Korea's nuclear denuclearization. 
Neighboring countries must closely watch if the North will keep its 
promises. The delisting of the North as a state sponsor of terrorism 
by the United States is a key element. 
 
A six-party agreement featuring the roadmap to advance the second 
phase has officially been unveiled. This follows the first phase, in 
which North Korea shut down its key nuclear facilities. 
 
Although it clearly specifies Dec. 31 as the deadline for disabling 
major nuclear facilities and declaring all nuclear programs, the 
agreement contains some loopholes and many ambiguous points as 
well. 
 
Under the agreement, the North is required to disable three 
facilities at Yongbyon: a 5 megawatt graphite-moderated nuclear 
reactor, a nuclear fuel fabrication plant, and a spent-fuel 
reprocessing facility. If the period of disablement were set for a 
year or so, the North might reactivate those facilities once that 
period was over. The facilities must be abandoned once and for all. 
There are other facilities that look suspicious as well. 
 
That is why a full declaration of all nuclear programs is so vital. 
A complete declaration would clarify the total amount of plutonium 
and the number of nuclear bombs possessed by North Korea. A threat 
from North Korea comes from them. 
 
The North also reaffirmed its commitment not to transfer nuclear 
materials, technology, or know-how. This, too, requires monitoring. 
An alleged program to produce highly enriched uranium also requires 
appropriate measures, such as an inspection, so as not to leave any 
suspicions. 
 
The joint statement issued in September 2005 says: "The DPRK 
committed to abandoning all nuclear weapons and existing nuclear 
programs." 
 
If the six-party framework were to back away from it, its ultimate 
goal of denuclearizing the Korean Peninsula would turn into pie in 
the sky. 
 
To prevent that from happening, the United States must not delist 
 
TOKYO 00004666  011 OF 012 
 
 
North Korea as a state sponsor of terrorism. Pyongyang is fixated on 
this matter because it is directly connected with sanctions against 
North Korea. 
 
The agreement also says: "The United States will begin the process 
of removing the designation of the DPRK as a state sponsor of 
terrorism in parallel with the DPRK's actions." 
 
This leaves some room for controversy over its interpretation. The 
delisting must be based on nuclear abandonment and the elimination 
of suspicions about sponsoring terrorism, such as repatriating 
Japanese abductees. 
 
The United States and North Korea have been taking the lead lately 
in the six-party talks. Repeated compromises by the Bush 
administration driven by a desire to produce results by the end of 
the year would lead to serious problems in the future. The United 
States bears extremely heavy responsibilities. 
 
About Japan-North Korea relations, the agreement reads: "The DPRK 
and Japan will make sincere efforts to normalize their relations 
expeditiously in accordance with the Pyongyang Declaration, on the 
basis of the settlement of the outstanding issues of concern." We 
urge North Korea to take steps to quickly settle the abduction 
issue, one of the "outstanding issues of concern." 
 
(10) Editorial: Consideration must be given to ordinary shareholders 
in triangular mergers (Nikkei) 
 
NIKKEI (Page 2) (Full) 
October 4, 2007 
 
Following the removal of a ban on triangular mergers in May, the 
first triangular merger in effect will take place shortly. The 
Citigroup of the US announced that it will wholly own the Nikko 
Cordial Group, which is now under its umbrella, through a stock swap 
using its own stocks. The ban on the triangular merger method was 
removed with the aim of boosting foreign investment in Japan. The 
case this time deserves high marks in terms of certain consideration 
having being given to protecting ordinary stockholders. 
 
The triangular merger means a merger method in which foreign 
companies acquire Japanese companies through their subsidiaries in 
Japan. A major feature of the method is that an acquiring company 
transfers its foreign stocks, instead of cash, to the shareholders 
of a company to be. 
 
There are two points worthy of attention in the merger between 
Citigroup and Nikko Cordial. First, Citigroup has applied for its 
listing on the Tokyo Stock Exchange (TSE) and its application will 
likely be granted before year's end. As a result, Nikko Cordial will 
be delisted, but its stockholders will be able to trade Citigroup's 
stocks obtained through a stock swap on the TSE. 
 
Second, Citigroup will transfer, in principle, its stocks equivalent 
of 1,700 yen to each Nikko share. Citigroup started a takeover bid 
(TOB) paying 1,700 yen per stock this spring. It has apparently 
adopted the same condition its set at that time so that Nikko 
shareholders would not feel a sense of unfairness. 
 
It is meaningful that the largest foreign securities house in 
nominal and real terms operating in Japan will come into existence. 
 
TOKYO 00004666  012 OF 012 
 
 
If the merger this time spurs a move for domestic companies to 
strengthen their global strategies, it would boost opportunities for 
investors to internationally disperse the destinations of their 
investments and for companies to procure funds abroad or implement 
M&As. 
 
We want to give consideration here to pending issues posed by 
triangular mergers. In order to make foreign companies find it easy 
to list themselves on the Japanese stock market, it is necessary to 
lower various costs involved, including screening of foreign 
companies. The TSE at the end of last year introduced a simplified 
screening system to be applied to companies that are listed on the 
New York Stock Exchange and other major stock exchanges. However, 
this system has not yet been applied. We want the TSE to come up 
with ideas for reducing foreign companies' burdens. 
 
From the viewpoint of protecting investors, it is necessary for 
Japanese companies to explain procedures arising from triangular 
mergers in lucid language. Stockholders who are against a merger 
proposal have a right to have their stocks purchased by an acquiring 
company. It is essential to spread information like this to 
investors. 
 
DONOVAN