VZCZCXRO1420
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #5028/01 3020122
ZNR UUUUU ZZH
P 290122Z OCT 07
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 9006
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 6431
RUEHFK/AMCONSUL FUKUOKA 4020
RUEHOK/AMCONSUL OSAKA KOBE 7685
RUEHNAG/AMCONSUL NAGOYA 2871
RUEHKSO/AMCONSUL SAPPORO 4708
RUEHBJ/AMEMBASSY BEIJING 9769
RUEHUL/AMEMBASSY SEOUL 5823
RUCNDT/USMISSION USUN NEW YORK 6631

UNCLAS SECTION 01 OF 12 TOKYO 005028 
 
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: JAPANESE MORNING PRESS HIGHLIGHTS 10/29/07 
 
 
Index: 
 
1) US Embassy in Tokyo has not paid rent on property in 10 years, 
refusing to go along with rent hike (Asahi) 
 
Opinion polls: 
2) Fukuda Cabinet support rate slips 4 points to 55 PERCENT  in 
Nikkei poll; 44 PERCENT  of public approve, 35 PERCENT  disapprove 
of MSDF continuing refueling operations (Nikkei) 
3) Kyodo poll: 7.6 point drop to 47 PERCENT  in Fukuda Cabinet 
support rate; 45 PERCENT  of public approve, 29.6 PERCENT 
disapprove of MSDF continuing Indian Ocean operations (Tokyo 
Shimbun) 
4) 66 PERCENT  of public support pressure policy toward North Korea 
in Mainichi poll, with only 29 PERCENT  favoring a dialogue line 
(Mainichi) 
 
North Korea problem: 
5) Washington Post reports Ambassador Schieffer in cable to 
President was concerned that removal of DPRK from terror list would 
hurt alliance with Japan (Nikkei) 
6) Government expects results by end of year from new dialogue 
policy approach toward North Korea (Nikkei) 
 
7) Defense Secretary Gates coming to Japan next month to press Japan 
to make efforts on resolving pending defense-related issues (Sankei) 
 
 
MSDF refueling mission in Indian Ocean: 
8) Government and ruling parties plan three-week Diet extension to 
allow time for passage of MSDF refueling bill (Asahi) 
9) US officials in series of meetings with Japanese officials in 
Washington call on Japan to continue MSDF refueling services in 
Indian Ocean (Nikkei) 
10) Prime Minister Fukuda calls on Democratic Party of Japan to have 
talks with ruling camp about its idea for civilian dispatches for 
Afghan assistance (Mainichi) 
 
Defense Ministry's woes: 
11) Prime Minister Fukuda, reviewing the troops, calls for tougher 
discipline in SDF in wake of series of scandals and problems 
(Mainichi) 
12) 90 PERCENT  of defense contracts awarded to Yamada Yoko Corp., 
which is now being investigated, were discretionary and not 
subjected to open bidding (Tokyo Shimbun) 
13) Former executive director of Yamada Corp. asked for 100 million 
yen from American affiliate, of which 30 million used to form new 
company (Asahi) 
14) Survey reveals 15 defense contractors now employ 475 retired 
Defense Ministry bureaucrats (Akahata) 
 
China issue: 
15) Chinese vessel filled with activists enter Japanese waters 
around Senkaku Islands (Tokyo Shimbun) 
16) Japan protests to China entry of vessel into waters near 
Senkakus (Tokyo Shimbun) 
 
17) DPJ to halve costs for convention (Mainichi) 
 
Articles: 
 
1) US Embassy fails to pay rent for 10 years for leased national 
 
TOKYO 00005028  002 OF 012 
 
 
property priced at 2.5 million yen annually 
 
ASAHI (Page 1) (Full) 
October 29, 2007 
 
The United States Embassy in Japan has not paid the rent for 10 
years on the 13,000 square meters of national property it occupies 
in Akasaka, Tokyo. The Japanese government used to receive 2.5 
million yen in annual rent until 1997. That year, the government 
presented a plan to raise the rent, but the US government turned it 
down and has refused to pay the annual rent since then. The statute 
of limitations for the rent for 1998 expires in mid-December. 
Keeping in mind the possibility of bringing a civil suit to pursue 
this matter, Japan is continuing negotiations with the US. 
 
The governments of Japan and the US in 1890 concluded a contract for 
leasing the property in question. Reflecting property value rises, 
Japan raised the rent twice: in 1974 and 1983. 
 
The US has declined Japan's plan to raise the land rent to a level 
equivalent to 10 times higher than the initial one in stages 
starting in 1998. Under civil law, rent claims expire five years 
after they are made. In this case, however, since the Japanese 
government sent the US Embassy a letter in December 2002 calling for 
the payment, the statute of limitations was cancelled briefly, and 
the final claim runs out this December. 
 
The government has leased national property to the embassies of four 
countries, including the US and Britain. According to real estate 
agents, the 2.5 million yen in annual rent for the prime land near 
the areas of government ministries and the Diet is "very cheap." 
 
Rent for property occupied by the British Embassy that has an area 
of 35,000 sq. meters (Ichiban-cho, Tokyo) is 35 million yen 
annually. 
 
A Japanese government official commented: "Relations with the US are 
naturally important, but we cannot easily make a compromise with the 
US due to our austere fiscal conditions." 
 
A political settlement might be reached, but if no agreement is 
reached before the statute of limitations expires, this issue might 
develop into an unusual civil suit between Japan and the US. 
 
A US embassy spokesman said: "We expect to see a settlement of the 
problem through talks with the Japanese government." 
 
2) Poll: Cabinet support down to 55 PERCENT ; 47 PERCENT  for, 35 
PERCENT  against continuing MSDF's refueling mission 
 
NIKKEI (Page 1) (Abridged) 
October 29, 2007 
 
The approval rating for Prime Minister Yasuo Fukuda and his cabinet, 
which has now been in office for a month since its inauguration, was 
55 PERCENT  in a public opinion survey conducted by the Nihon Keizai 
Shimbun on Oct. 26-28, down 4 percentage points from the last survey 
taken in late September. The disapproval rating for the Fukuda 
cabinet was 31 PERCENT , up 4 points. In the survey, respondents 
were also asked if they thought the Maritime Self-Defense Force's 
refueling mission in the Indian Ocean should be continued beyond its 
Nov. 1 time limit. In response to this question, 47 PERCENT 
 
TOKYO 00005028  003 OF 012 
 
 
answered "yes," with 35 PERCENT  saying "no." 
 
By gender, the Fukuda cabinet's support rate was 49 PERCENT  among 
men (down 5 points from the last survey) and 60 PERCENT  among women 
(down 2 points). By age, it was 63 PERCENT  among those aged 70 and 
over and 41 PERCENT  among those in their 20s. 
 
About continuing the MSDF's refueling activities in the Indian 
Ocean, the proportion of affirmative answers leveled off from the 
last survey. However, the proportion of negative answers decreased 2 
points. 
 
The survey was taken by Nikkei Research Inc. over the telephone on a 
random digit dialing (RDD) basis. For the survey, samples were 
chosen from among men and women aged 20 and over across the nation. 
A total of 1,582 households with one or more voters were sampled, 
and answers were obtained from 911 persons (57.6 PERCENT ). 
 
3) Poll: Cabinet support falls 7.6 points to 50.2 PERCENT 
 
TOKYO (Top play) (Abridged) 
October 29, 2007 
 
In a telephone-based Kyodo News poll conducted across the nation on 
Oct. 27-28, the rate of public support for Prime Minister Yasuo 
Fukuda and his cabinet, now in office for a month, was 50.2 PERCENT 
, down 7.6 percentage points from a survey taken right after the 
Fukuda cabinet came into office. The nonsupport rate for the Fukuda 
cabinet rose 4.0 points to 29.6 PERCENT . The figures can be taken 
as reflecting various problems, such as the government's correction 
in the amount of fuel supplied by the Maritime Self-Defense Force in 
the Indian Ocean, former Administrative Vice Defense Minister 
Takemasa Moriya's collusive ties with a defense contractor, and the 
Health, Labor and Welfare Ministry's cover-up of data about 
hepatitis C. 
 
In the survey, respondents were asked if they thought the MSDF's 
refueling activities in the Indian Ocean should be continued. In 
response to this question, 46.4 PERCENT  answered "yes," down 3.2 
points from the last survey. Meanwhile, the proportion of those who 
answered "no" increased 3.4 points to 42.9 PERCENT . In the last 
survey, the margin between the proportions of affirmative and 
negative answers was about 10 points. This time, it narrowed to 3.5 
points, showing a split in public opinion. 
 
Respondents were also asked if they supported the government's new 
antiterror legislative measure. To this question, 45.0 PERCENT 
answered "yes," with 39.3 PERCENT  saying "no." In the breakdown of 
reasons among those affirmative about continuing the MSDF's 
refueling activities in the Indian Ocean, 54.3 PERCENT  answered 
that the MSDF's refueling activities there are needed for Japan's 
international contributions, with 17.6 PERCENT  saying the MSDF's 
activities are limited to fuel and water supply only and 11.2 
PERCENT  saying the MSDF's activities there are intended to prevent 
and root out terrorism. Among those negative, 42.3 PERCENT  answered 
that Japan should make international contributions in non-military 
areas, such as industrial and educational areas, with 23.8 PERCENT 
saying the government-introduced bill does not ask for Diet approval 
and 18.5 PERCENT  saying the MSDF could come under attack. Those who 
"don't know" and those who gave no answer totaled 15.7 PERCENT . 
 
Asked about the desirable image of government, 42.4 PERCENT  opted 
 
TOKYO 00005028  004 OF 012 
 
 
for a coalition government led by the Democratic Party of Japan 
(Minshuto), with 39.8 PERCENT  preferring a coalition government led 
by the Liberal Democratic Party. As seen from these figures, those 
desiring a DPJ-led coalition government outnumbered those choosing 
the current LDP-led coalition government. In the last survey, the 
proportion of those in favor of the LDP-led coalition was 1.2 points 
higher than that of those preferring a DPJ-led coalition. This time, 
however, the two figures changed places. 
 
In the breakdown of public support for political parties, the LDP 
stood at 35.5 PERCENT , down 2.9 points from the last survey, with 
the DPJ at 31.1 PERCENT , up 2.9 points. New Komeito, the LDP's 
coalition partner, was at 3.1 PERCENT , down 2.3 points from the 
last survey. Among other political parties, the Japanese Communist 
Party was at 2.4 PERCENT  (down 0.5 points), the Social Democratic 
Party (Shaminto) at 2.0 PERCENT  (down 1.1 points), the People's New 
Party (PNP or Kokumin Shinto) at 0.8 PERCENT  (up 0.6 points), and 
the New Party Nippon (NPN or Shinto Nippon) at 0.4 PERCENT  (up 0.3 
points). "None" accounted for 23.9 PERCENT  (up 3.9 points). 
 
4) Poll: 66 PERCENT  want gov't to pressure N. Korea 
 
MAINICHI (Page 2) (Abridged) 
October 28, 2007 
 
The Mainichi Shimbun conducted a nationwide public opinion survey on 
Oct. 20-21, in which respondents were asked about the future course 
of the government's policy toward North Korea that is based on 
"dialogue and pressure." In response to this question, two-thirds of 
the respondents answered that they wanted the government to pressure 
North Korea. Prime Minister Yasuo Fukuda is laying emphasis on 
dialogue in his North Korea policy. In the survey, however, those 
who want the government to assume a dialogue-oriented attitude 
toward North Korea accounted for only a little less than 30 PERCENT 
. This can be taken as reflecting public frustration at the pending 
issue of Japanese nationals abducted to North Korea. Such public 
opinion is expected to affect the government's policy toward North 
Korea. 
 
"Prime Minister Shinzo Abe and his cabinet laid emphasis on its 
stance of taking a pressure-oriented policy toward North Korea." 
Following this explanation, the survey asked respondents to pick one 
out of three options given about what Japan should do from now on in 
its North Korea policy. To this question, 36 PERCENT  answered that 
Japan should increase its pressure further, topping all other 
answers. Among other answers, 30 PERCENT  said the government should 
continue the Abe cabinet's pressure-oriented stance, with 29 PERCENT 
 saying the government should switch to a dialogue-oriented 
attitude. Those who want the government to take a pressure-oriented 
stance totaled 66 PERCENT . 
 
Even among those who support the Fukuda cabinet, the proportion of 
those who want the Fukuda cabinet to take a dialogue-oriented stance 
was only 31 PERCENT . Among those who do not support the Fukuda 
cabinet, those insisting on increasing pressure added up to 42 
PERCENT . 
 
5) US Ambassador Schieffer sends President Bush cable warning quick 
delisting of North Korea as state sponsor of terrorism could damage 
Japan-US relations 
 
NIKKEI (Page 2) (Full) 
 
TOKYO 00005028  005 OF 012 
 
 
October 27, 2007 
 
The Washington Post in the Oct. 26 edition reported that US 
Ambassador to Japan Thomas Schieffer had sent an official cable to 
President George W. Bush noting: "If the US delists North Korea 
quickly, it could damage relations with Japan, the US' closest ally 
in the pacific region." The ambassador has expressed his 
dissatisfaction with Assistant Secretary of State Christopher Hill 
for his stance of leaving the ambassador uniformed of the details of 
negotiations while stressing the need for substantive progress on 
the issue of North Korea's past abduction of Japanese nationals. It 
is quite unusual for an ambassador to send a cable directly to a 
president. 
 
6) New policy approach to North Korea involving incremental aid 
measures to be broached in bilateral working group talks early next 
month, aiming at results by the end of the year 
 
NIKKEI (Page 2) (Excerpts) 
October 28, 2007 
 
Japan and North Korea will convene in early November a meeting of 
their working group on normalization on relations under the 
framework of the six-party talks. The outlook is for talks to center 
on Japan's new policy approach of meeting progress on such pending 
issues as the return of abductees to Japan with a staged-in removal 
of sanctions now imposed on the DPRK and the providing of aid. The 
aim is to produce certain results by the end of the year, when other 
moves will come together, such as North Korea's nuclear issue and 
the removal of its name from the US list of states sponsoring 
terrorism. 
 
Coordination is underway for the working group to possibly meet in 
Southeast Asia, such as in Malaysia, with several meetings to take 
place as necessary until the end of the year. Prime Minister Yasuo 
Fukuda has indicated his intention to quickly find a breakthrough in 
the abduction issue, and when he met with the representatives of the 
abductee families on the 26th, he announced: "There is now a good 
environment in which to negotiate with North Korea. We will 
negotiate by using every means possible, for I would like to resolve 
this issue." 
 
The focus of bilateral talks with North Korea now, including 
possible secret negotiations, will be whether the North will respond 
immediately by allowing all of the remaining abducted victims to 
return to Japan. The Fukuda administration has taken as an important 
stance the possibility of "progress" as a prior stage to "resolving" 
the issue. Assuming that North Korea will respond, consideration is 
apparently underway as to what the definition of "progress" should 
be, and "action in response to the level of progress," according to 
Foreign Minister Komura. 
 
7) US Defense Secretary to visit Japan next month, the last stop in 
a three-country tour; May urge Japan to make more efforts on pending 
issues 
 
SANKEI (Page 7) (Excerpts) 
October 27, 2007 
 
Takashi Arimoto in Washington, D.C. 
 
The schedule for Secretary of Defense Gates' three-country tour to 
 
TOKYO 00005028  006 OF 012 
 
 
Japan, the Republic of Korea, and China, starting on Nov. 7, was 
firmed up yesterday. According to a source connected to Japan-US 
relations, the visit to Japan will be the last stop in the tour. 
According to the same source, one might say that the trip "will be a 
signal to Japan to make more efforts" to resolve what compared to 
South Korea and China seems like a mountain of pending issues, 
including continuing the refueling operation of the Maritime 
Self-Defense Force (MSDF) in the Indian Ocean, which is about to be 
halted, and the lack of progress in the realignment of US forces in 
Japan. 
 
This will be the first trip to Japan by Gates since he was appointed 
defense secretary last December. A Pentagon source noted: "the 
specific itinerary of the Secretary cannot be announced until after 
he departs." Bilateral issues with Japan include the continuing of 
MSDF refueling, the realignment of US forces in Japan, and 
host-nation support (sympathy budget) of US forces in Japan, which 
will run out next March. 
 
However, Japan has an accumulation of its own issues, including the 
inappropriate relation between former Vice Defense Minister Moriya 
and a defense contractor. And the correction of the amount of fuel 
supplied by the MSDF (in the Indian Ocean to a US vessel). Japan 
will be under pressure to handle its own domestic issues. 
 
The same source pointed out: "We should recognize that the Japan-US 
alliance, which is supposed to be in the best shape ever is in a 
dangerous situation." 
 
8) Government, ruling coalition plan to extend Diet session for 
three weeks 
 
ASAHI (Page 1) (Full) 
October 27, 2007 
 
The government and ruling parties generally decided on Friday to 
extend the current Diet session, which is scheduled to end on Nov. 
¶10. They will coordinate on a plan to extend the session for three 
weeks until the end of November. The aim is to allow time to enact 
the new bill to continue the Maritime Self-Defense Force's (MSDF) 
refueling mission in the Indian Ocean after passing it through the 
House of Representatives in early November. However there is no 
change in the situation that it will be difficult to enact the bill 
even if the session is extended, because the main opposition 
Democratic Party of Japan (DPJ or Minshuto) is unlikely to support 
the legislation, and because many members in the ruling coalition 
are cautious about taking a vote twice in the Lower House. 
 
The expectation is that the opposition camp will oppose an extension 
of the current extraordinary session. The ruling coalition, however, 
intends to obtain understanding from the opposition camp by carrying 
out deliberations on the DPJ-sponsored livelihood-related bills and 
three labor-related bills the government drafted. 
 
Due to the allegation of diversion of fuel supplied by the MSDF to a 
US supply ship and a scandal involving former Administrative Vice 
Defense Minister Takemasa Moriya's inappropriate relationship with a 
defense contractor, there is also a strong view that the current 
session should not be extended. However, the Prime Minister's 
Official Residence (Kantei) and the ruling Liberal Democratic Party 
(LDP) executives have determined that they should not give up their 
effort to enact the refueling bill. 
 
TOKYO 00005028  007 OF 012 
 
 
 
Another aim in extending the session is for the ruling coalition to 
show that if the bill is voted down in the House of Councillors, the 
DPJ is to be held responsible for the failure. LDP Secretary General 
Bunmei Ibuki stressed in a press conference on the 26th: "I want to 
see what kind of decisions the Upper House, including the DPJ, will 
make." A high government official commented: "It is unthinkable that 
the session will be extended" since Prime Minister Yasuo Fukuda will 
visit the United States in mid-November. 
 
The outlook is that the new antiterrorism legislation will pass the 
Lower House before the end of the current session at the earliest, 
as a Lower House committee has already started deliberations on the 
bill on the 26th. The ruling camp predicts that an extension of the 
session until the end of November will be enough to conduct 
deliberations on the legislation, even though the DPJ has the lead 
in debate in the Upper House. 
 
If the Upper House scraps the refueling bill, the government and 
ruling camp will make a decision on whether they can enact the bill 
with approval of a two-third Lower House majority by taking a second 
vote, while watching public opinion. Even if the Lower House does 
not take a second vote on the bill, the session will unlikely be 
further extended until late December. A senior LDP member said: "We 
can't carry out Diet management that will affect the compilation of 
a budget for next fiscal year." 
 
However, there still remain uncertainties about how long the session 
should be extended. If the scandal involving Moriya, who will be 
summoned to the Diet to testify as a sworn witness on the 29, 
continues to grow, the possibility is that it will be difficult to 
pass the new antiterrorism through the Lower House before the end of 
the session. Closely watching public response to a possible 
withdrawal of the MSDF from the Indian Ocean as the present 
antiterrorism law expires on Nov. 1, the government and ruling 
coalition will make a final decision in early November on the 
session extension issue. 
 
9) In working-level talks prior to prime minister's visit to US, 
calls one after the other from US officials for Japan to continue 
refueling mission 
 
NIKKEI (Page 2) (Excerpt) 
October 28, 2007 
 
Hiroshi Maruya in Washington, D.C. 
 
A series of working -level talks between Japan and the United States 
prior to Prime Minister Fukuda's US visit ended on Oct. 26. Vice 
Foreign Minister Yachi and the Foreign Ministry's Asia-Pacific 
Bureau Director General Sasae, who were visiting the U.S. 
transmitted the Japanese government's views on the removal of North 
Korea from the US list of states sponsoring terrorism, as well as 
the host-nation support (sympathy budget). The US side plans to have 
the President during his summit meeting with Fukuda in mid-November 
seek a continuance of the refueling operation in the Indian Ocean. 
"Expressing the feelings of the entire international community, I 
would like Japan to continue supplying oil," said Deputy Defense 
Secretary Gordon England to Yachi during their meeting. He strongly 
 
SIPDIS 
urged the quick enactment of the new bill that would allow continued 
refueling services. Similar expectations were voiced during meetings 
with National Security Council and other White House officials. 
 
TOKYO 00005028  008 OF 012 
 
 
 
10) Prime Minister Fukuda at Lower House special committee: We have 
to consider what civilian assistance Japan can offer in Afghanistan 
 
MAINICHI (Page 5) (Full) 
October 27, 2007 
 
Prime Minister Yasuo Fukuda stated on Oct. 26 at a House of 
Representatives Special Committee on Antiterrorism and Assistance 
for Iraq: "We have to always look into the possibility as to what 
civilian assistance Japan can provide (in Afghanistan) in 
cooperation with other countries." He revealed that he would 
consider responding to changes in the situation. He was replying to 
a question by Yasutoshi Nishimura of the ruling Liberal Democratic 
Party (LDP). 
 
Fukuda called on the largest opposition Democratic Party of Japan 
(DPJ or Minshuto) to hold consultations, noting, "(Regarding the 
security issue) I would like to get support from as many people as 
possible. I have envisioned discussions with the opposition bloc." 
The prime minister apparently made the remarks with an eye on DPJ 
President Ichiro Ozawa's advocacy of civilian assistance in 
Afghanistan. 
 
Masao Akamatsu of the New Komeito questioned Defense Minister 
Shigeru Ishiba, who was director general of the Defense Agency, 
about his responsibility for supervising former Administrative Vice 
Minister Takemasa Moriya over his alleged golfing with a former 
defense equipment trading house executive. Ishiba responded: 
 
"At that time I was working even Saturdays and Sundays in dealing 
with such issues as the establishing of contingency law and dispatch 
of Self-Defense Force troops to Iraq. It was my mistake that I 
shared a similar view with (Mr. Moriya). If the fact that I believed 
in him is wrong, I will take responsibility for that." 
 
11) Prime Minister Fukuda: Senor SDF officers must maintain 
discipline 
 
ASAHI (Page 2) (Full) 
October 29, 2007 
 
Prime Minister Yasuo Fukuda provided instruction yesterday at an 
annual review at the Ground Self-Defense Force's Camp Asaka in 
Tokyo. Keeping in mind cozy ties between former Administrative Vice 
Defense Minister Takemasa Moriya and a defense equipment trading 
house, as well as the ministry's failure to correct its underreport 
of the amount of fuel the Maritime Self-Defense Force (MSDF) 
supplied to a US ship in the Indian Ocean, the prime minister 
stated: "It is truly deplorable that there have been problems 
concerning maintaining discipline and managing intelligence in 
recent years." He also demanded greater discipline, saying: "In 
particular, senor officials need to be aware that the duty of 
national defense cannot be fulfilled without the people's trust, 
hence the need to ensure strict discipline." 
 
12) Of Yamada Yoko's 117 contracts with Defense Ministry between 
FY2002 and FY2006, 112 were discretionary 
 
TOKYO SHIMBUN (Page 1) (Excerpts) 
October 29, 2007 
 
 
TOKYO 00005028  009 OF 012 
 
 
It has been found through the Defense Ministry's documents that of 
the 117 contracts (totaling 17.46 billion yen) on such central 
equipment as engines awarded by the Defense Ministry (formerly 
Defense Agency) to the Tokyo-based defense trader Yamada Yoko Corp. 
between FY2002 and FY2006, 112 cases (worth 16.47 billion yen), or 
over 90 PERCENT , were discretionary contracts. 
 
In the wake of a crackdown on bid-ridding for a ridge project and a 
bureaucrat-initiated bid-rigging scandal involving the Defense 
Facilities Administration Agency, government agencies have 
introduced a competitive bidding system. But collusive ties between 
contractors and Defense Ministry officials are still very much alive 
in the area of defense equipment, in which a large part is imported 
from overseas military manufacturers and concluding discretionary 
constricts with contractors rich in know-how is still common for 
keeping defense secrets. 
 
By year, in FY2002, of the 36 cases (3.13 billion yen), all but one 
open-bidding case were discretionary contracts. In FY2003, of the 28 
cases (2.5 billion yen), 27 (2.39 billion yen) were discretionary. 
In FY2004 and FY2005, all cases -- 18 cases (4.14 billon yen) and 20 
cases (4.34 billion yen), respectively -- were discretionary. 
 
In FY2006, 15 cases (3.33 billion yen) were subject to competitive 
bidding, but eventually 12 ended up as discretionary contracts for 
such reasons as that there were no applicants or successful 
bidders. 
 
Yamada Yoko won discretionary contracts totaling 2.64 billon yen in 
FY2004 for the shipment of a system for the Air Self-Defense Force's 
next-generation transport aircraft (CX), such as engines, and 1.25 
billion yen in FY2005. 
 
13) Former executive of Yamada Corp. instructs former president of 
subsidiary in US to send 100 million yen, suspected of using 30 
million yen for new company 
 
YOMIURI (Page 39) (Excerpts) 
October 29, 2007 
 
Former executive Motonobu Miyazaki of Yamada Corp., a trading 
company specializing in defense and aircraft equipment, whose cozy 
relations with former Vice Defense Minister Takemasa Moriya have 
been reported, had instructed the former president of its subsidiary 
in the United States to send approximately 100 million yen to Japan, 
it has been learned. It has also been found that Miyazaki allegedly 
used 30 million yen of the 100 million yen as capital for his new 
company. The Tokyo District Public Prosecutors Office's special 
investigation squad is trying to trace the money by questioning 
Miyazaki and the former president. 
 
Miyazaki quit the company in June last year and established a new 
company named Nippon Miraizu, based in Tokyo, in September the same 
year. It has been recorded that 30 million yen in capital for the 
new company was invested by G Zero Holding, the predecessor of 
Nippon Miraizu started up by Miyazaki in July the same year. 
According to sources familiar with the matter, in the accounts of 
Yamada International Corp., a subsidiary of Yamada Corp. in the US 
based in Washington, about 100 million yen was left unaccounted for 
after Miyazaki left the company. This is part of the money deposited 
in a bank account under the name of the former president, and the 
former president had sent the money to Miyazaki before the president 
 
TOKYO 00005028  010 OF 012 
 
 
quit in August of last year, according to the sources. 
 
In late August, 30 million yen in capital for Nippon Miraizu was 
transferred from G Zero. Around that time, Miyazaki was having 
difficulty raising money. Even after establishing the new company, 
he procured operating capital from several moneylenders. 
 
14) 475 former Defense Ministry officials employed at top 15 defense 
companies accounting for 70 PERCENT  of defense contracts; Huge 
donations to LDP 
 
AKAHATA (Top play) (Full) 
October 28, 2007 
 
In the wake of the revelation of improper ties between former 
Administrative Vice-Defense Minister Takemasa Moriya, 63, and 
defense equipment trader Yamada Yoko Corp., the Akahata's 
investigations have found that a total of 475 former Defense 
Ministry officials have landed jobs at the ministry's top 15 
contractors after retirement. It has also become clear that the 15 
firms have accounted for 70 PERCENT  of the total defense contract 
amount that they have donated huge amounts of money to the Liberal 
Democratic Party. 
 
These firms are major defense enterprises that have received orders 
from the Self-Defense Forces for equipment, ammunition, fuel and so 
on. The total amount of contract won in FY2006 by the 15 firms, led 
by Mitsubishi Heavy Industries, Ltd.'s 277.6 billion yen, came to 
907.6 billion yen, or 70 PERCENT  of the Defense Ministry's total 
contract amount. 
 
As of April 2006, 13 companies, excluding two that did not have any, 
employed a total of 475 former Defense Ministry officials, including 
98 at Mitsubishi Electric Corp., 62 at Mitsubishi Heavy Industries, 
and 59 at Hitachi Ltd. (Fujitsu Ltd.'s figure alone was as of 
October 2005). 
 
Top three firms with over 100 billion yen in contract amount had an 
average of 69.7 former officials. The average of six companies, such 
as NEC Corp., with contracts over 30 billion yen and less than 100 
billion yen, came to 27. Six firms with contracts less than 20 
billion yen had an average 17.3 retired officials. This has also 
revealed the correlation that the amount of contracts increases in 
proportion to the number of former officials. 
 
In addition, 11 companies, topped by Mitsubishi Heavy Industry's 30 
million yen, donated a total of 186.9 million yen in FY2006 to the 
National Political Association, the LDP's fund-management 
organization. 
 
Collusive ties between the defense industry and the Defense 
Ministry, including allegations over Moriya, must be thoroughly 
probed into. 
 
15) Chinese protest vessel temporarily entered Japanese waters near 
Senkaku Islands 
 
TOKYO SHIMBUN (Page 3) (Full) 
October 29, 2007 
 
Yuji Hiraiwa, Beijing 
 
 
TOKYO 00005028  011 OF 012 
 
 
A civilian organization claiming China's sovereignty over the 
Senkaku Islands, known as Diaoyu in China, made it clear on Oct. 28 
that a protest vessel had been headed for the disputed islets. 
According to the group's spokesperson, the protest boat entered 
Japanese waters around the islands on the night of Oct. 28 but left 
Japanese waters due to the spraying of water by a Japan Coast Guard 
vessel. In an interview with the Tokyo Shimbun, the spokesperson 
expressed a desire to land on the islets if conditions were 
favorable. 
 
According to the organization, the protest vessel carrying four 
Chinese citizens left Amoy, Fujian Province, on Oct. 26. 
 
"The four persons have taken the action voluntarily," the 
spokesperson said. He also explained the reason for taking the 
action at this point in time this way: "People would go to the 
Diaoyu until they return to China. No special motive is necessary." 
 
In March 2004, seven Chinese activists who landed on the islands 
were arrested and removed by the Okinawa Prefectural Police. 
 
16) Government files protest with China 
 
TOKYO SHIMBUN (Page 3) (Full) 
October 29, 2007 
 
In the wake of a Chinese protest vessel's intrusion into Japanese 
waters near the Senkaku Islands, known as Diaoyu in China, the 
government on Oct. 28 lodged a protest with the Chinese government 
through diplomatic channels, saying, "In view of history and 
international law, the Senkaku Islands are undoubtedly an inherent 
part of Japan's national territory. It is extremely regrettable that 
such an incident occurred." 
 
In response, China urged Japan to respond calmly from a broad 
perspective of Japan-China relations, while indicating that Japan's 
request was unacceptable. 
 
The government also collected information, establishing a liaison 
office in the Crisis Management Center at the Prime Minister's 
Official Residence (Kantei). 
 
17) DPJ to halve costs for convention 
 
MAINICHI (Page 2) (Abridged) 
October 28, 2007 
 
The leading opposition Democratic Party of Japan (Minshuto) has now 
decided to cut cots for its convention, which is scheduled to be 
held in the city of Yokohama on Jan. 16 next year. The DPJ will 
shorten the convention's period from two days to one day and will 
hold no showy attractions. The DPJ used to spend 40-50 million yen 
on its annual convention. Next year, however, the DPJ will halve its 
convention spending to about 20 million yen. The decision reflects 
DPJ President Ichiro Ozawa's view. Ozawa anticipates that the House 
of Representatives will be dissolved soon for a general election, so 
he wants to hold the party convention in a "modest" way to save and 
pour money on campaigning. 
 
According to the DPJ's secretariat, its annual convention gathers 
about 1,000 participants. The DPJ covers transportation expenses and 
hotel charges for its local delegates and guests. In December 2004, 
 
TOKYO 00005028  012 OF 012 
 
 
the DPJ held its convention in the city of Fukuoka for about 81 
million yen. This time, the DPJ will not show up its convention like 
dropping balloons from the ceiling. 
 
The DPJ is also well up in the art of saving money. According to its 
report of political funds for 2006, the DPJ has carried over more 
than 10 billion yen to 2007, topping the ruling Liberal Democratic 
Party's 6.7 billion yen. 
 
SCHIEFFER