VZCZCXRO9329
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0291/01 0360119
ZNR UUUUU ZZH
P 050119Z FEB 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 1495
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 8300
RUEHFK/AMCONSUL FUKUOKA 5904
RUEHOK/AMCONSUL OSAKA KOBE 9571
RUEHNAG/AMCONSUL NAGOYA 4528
RUEHKSO/AMCONSUL SAPPORO 6512
RUEHBJ/AMEMBASSY BEIJING 1496
RUEHUL/AMEMBASSY SEOUL 7559
RUCNDT/USMISSION USUN NEW YORK 8193

UNCLAS SECTION 01 OF 12 TOKYO 000291 
 
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 02/05/08 
 
 
Index: 
 
1) Top headlines 
2) Editorials 
3) Prime Minister's daily schedule (Nikkei) 
 
Child pornography issue: 
4) Prime Minister Fukuda vows to toughen restrictions on child 
pornography in Japan  (Nikkei) 
5) Justice Minister Hatoyama wants to make possession of child 
pornography a crime  (Yomiuri) 
 
Defense and security affairs: 
6) Iwakuni mayoralty race marks the third time that city voters have 
been asked to make their judgment on the relocation of U.S. jets 
from Atsugi  (Yomiuri) 
7) Yomiuri poll shows mayoralty race in Iwakuni is a dead heat 
(Yomiuri) 
 
Political agenda: 
8) Asahi poll finds 55 PERCENT  of public favor compromise between 
ruling and opposition camps in the Diet over tax issue instead of 
head-on clashes  (Asahi) 
9) LDP in disarray over revision of gasoline tax bill with 
road-policy clique dead set against placing gasoline tax revenues 
into general account budget  (Yomiuri) 
10) With Upper House controlled by opposition camp, if key 
budget-related bills are not passed on time, nation's broadcast 
system, NHK, could stop operating July 1  (Sankei) 
 
11) Poisoned dumpling panic could lead to strict system of labeling 
imported foods  (Yomiuri) 
 
12) Proposed restriction of foreign investments in airports may be 
motivated by desire to protect jobs of retired bureaucrats  (Tokyo 
Shimbun) 
 
13) Japanese flag-carrying ships to double in five years under new 
plan linked to resource development and acquisition of rare metals 
and other resources  (Yomiuri) 
 
14) Kyoto prefecture introduces new carbon gas bank scheme in which 
household reductions are purchased by companies  (Mainichi) 
 
Articles: 
 
1) TOP HEADLINES 
 
Asahi, Mainichi, Yomiuri, & Tokyo Shimbun: 
Pesticide detected inside unopened package of Chinese gyoza 
dumplings 
 
Nikkei: 
Companies offering better pay, hours to attract retired workers 
 
Sankei: 
Tianyang Foods frozen foods used in lunches in 606 schools 
 
Akahata: 
DPJ lawmaker Yamashita pursues shortage of doctors and financial 
difficulties in hospitals 
 
 
TOKYO 00000291  002 OF 012 
 
 
2) EDITORIALS 
 
Asahi: 
(1) Poisoned Chinese gyoza dumplings: Settlement is touchstone for 
Japan and China 
(2) New Thai government: Relapse not allowed 
 
Mainichi: 
(1) Ministry of Land, Infrastructure and Transport needs to provide 
convincing explanations on introduction of restrictions on foreign 
investment in airport management companies 
(2) Let us support system to protect rights of elderly with 
dementia 
 
Yomiuri: 
(1) Information disclosure: Measures to exclude fabrication urgently 
needed 
(2) Terrestrial digital broadcasting: Copyright protection and 
user-friendliness important 
 
Nikkei: 
(1) Can Japanese banks find means of survival? 
(2) Hotel ignored justice 
 
Sankei: 
(1) Poisonous Chinese gyoza dumplings: Close cooperation is 
important to resolve the issue 
(2) Albatross: We pray for success of relocation plan 
 
Tokyo Shimbun: 
(1) Microsoft's bid for Yahoo creating stir 
(2) What does Prime Minister Fukuda want to do with Social Security 
Council? 
 
Akahata: 
(1) Kyoto mayoral race: Best chance to refresh municipal 
administration 
 
3) Prime Minister's Official Residence (Kantei) 
 
Prime Minister's schedule, February 4 
 
NIKKEI (Page 2) (Full) 
February 5, 2008 
 
09:24 
Met with Deputy Chief Cabinet Secretary Futahashi at the Kantei. 
 
10:00 
Upper House Budget Committee meeting. 
12:32 
Met with Futahashi at the Kantei. 
 
13:00 
Upper House Budget Committee meeting. 
 
15:22 
Met with Futahashi and Assistance Deputy Chief Cabinet Secretary 
Saka, followed by Public Security Intelligence Agency Director 
General Yanagi. 
 
17:00 
 
TOKYO 00000291  003 OF 012 
 
 
LDP executive meeting in the Diet building. 
 
17:40 
Met with Afghan Foreign Minister Spanta. Deputy Assistant Chief 
Cabinet Secretary Ando was present. 
 
18:07 
Met with National Police Agency Director General Yoshimura and 
Security Bureau Director General Ikeda. Then met with Saka and 
Cabinet Secretariat Director General Yamamoto and General Affairs 
Ministry Administrative Management Bureau Director General Muraki. 
Saka remained. 
 
19:26 
Arrived at the official residence. 
 
4) Restrictions on child pornography to be tightened 
 
NIKKEI (Page 2) (Full) 
February 5, 2008 
 
At a meeting yesterday of the Upper House Budget Committee, Prime 
Minister Yasuo Fukuda referred to measures to address child 
pornography and noted, "We must take some action." He thus indicated 
he is positive about strengthening restrictions on child 
pornography. At present, simple possession of child pornography is 
not subject to regulation, but Justice Minister Kunio Hatoyama 
emphasized, "Moving to punish it would be desirable." Hatoyama was 
replying to a question raised by Haruko Arimura of the ruling 
Liberal Democratic Party. 
 
5) Justice minister mulling punishment for possession of child 
pornography 
 
YOMIURI (Page 2) (Full) 
February 5, 2008 
 
At a session yesterday of the Upper House Budget Committee, Justice 
Minister Hatoyama revealed his intention to consider revising the 
Law for Punishing Acts Related to Child Prostitution and Child 
Pornography by setting punishments even for simple possession of 
child pornography without any intention of selling or distributing 
it. 
 
Hatoyama noted: "Child pornography is closely intertwined with 
sexual abuse. Stricter punishment will be desirable. I think there 
is no problem about setting a punishment (for simple possession)." 
Prime Minister Fukuda, as well, pointed out: "A society that is 
tolerant of child pornography is not at all a society that we can be 
proud of." They were replying to a question posed by Haruko Arimura 
of the ruling Liberal Democratic Party. 
 
When the law drafted by a cross-party group of lawmakers was enacted 
in 1999, whether to set a stipulation banning simple possession of 
child pornography was discussed, but because many were opposed to 
such a stipulation as a violation of privacy, that stipulation was 
not included in the law. 
 
6) Iwakuni citizens to make decision for third time on relocation of 
U.S. air wing 
 
YOMIURI (Page 4) (Abridged slightly) 
 
TOKYO 00000291  004 OF 012 
 
 
February 5, 2008 
 
A fierce battle is underway for the Feb. 10 mayoral election of 
Iwakuni, Yamaguchi Prefecture, between former LDP House of 
Representatives member Yoshihiko Fukuda, who supports the 
government's plan to relocate a carrier-based air wing to the U.S. 
Marine air station in the city, and former Mayor Katsusuke Ihara, 
who opposes the plan. The outcome of the race in Iwakuni, a city of 
150,000, is a matter of great concern to the government and ruling 
parties, for it might affect the overall issue of U.S. force 
realignment. 
 
The governments of Japan and the United States are in an agreement 
to relocate 59 aircraft, including FA-18s, to the Iwakuni base from 
the U.S. Naval Air Facility Atsugi in Kanagawa Prefecture by 2014. 
The Iwakuni base, along with Futenma Air Station in Okinawa, is a 
symbol of the realignment of U.S. forces in Japan. 
 
Although a mayor has no legal authority to refuse relocation, the 
government is alarmed, with one person saying, "A victory by Ihara 
might give the impression that the realignment issue is not 
proceeding smoothly." 
 
Fukuda's resignation as a Lower House member will also result in a 
by-election in the Yamaguchi No. 2 constituency for April 27, the 
first national election under the Fukuda administration. The mayoral 
race is a prelude to the by-election. 
 
The LDP effectively backs Fukuda, and the major opposition 
Democratic Party of Japan supports Ihara. The two camps, referring 
to themselves as citizens' parties, plan to refrain from 
eye-catching activities, such as stumping for the candidates by 
party executives. 
 
Yesterday, the day after the official campaign for the race kicked 
off, Fukuda raised his voice at a restaurant parking lot overlooking 
the Iwakuni base, saying: "This area has been suffering from noise. 
I'll promise you that once I'm elected, I will negotiate with the 
government on a review of the flight paths and shortening flight 
times." 
 
Fukuda's strategy is to focus on revitalizing the local economy and 
fiscal issues, putting many conditions regarding the base issue to 
the central government. Lined with shuttered shops and restaurants, 
shopping streets near JR Iwakuni Station are nearly deserted. The 
city has over 100 billion yen in debt that bears 7 million yen in 
interest a day. 
 
Mainly backed by municipal assemblymen and business circles tolerant 
of the relocation plan, the Fukuda camp has repeatedly held small 
rallies in an effort to translate economic issues into votes. LDP 
lawmakers have also visited corporations behind the scenes. A large 
portion of New Komeito supporters, believed to number 7,000 to 
8,000, are also expected to vote for Fukuda. 
 
Iwakuni is going to the polls for the third time over the relocation 
issue. The anti-relocation group won a March 2006 municipal 
referendum and the April 2006 mayoral race. Ihara remained opposed 
to the relocation on the strength of those results. In reaction, the 
government has frozen 3.5 billion yen in subsidies in fiscal 2007 
for the construction of a new city hall. The government has also 
removed Iwakuni from the list of subsidies to local governments with 
 
TOKYO 00000291  005 OF 012 
 
 
greater base-hosting burdens. 
 
Ihara yesterday mainly campaigned in Iwakuni suburbs, arguing, 
"Whether the base will become bigger will be determined by this 
election. A bigger base will make your life harder." 
 
The Ihara camp, which is trying to rally together anti-relocation 
citizens, is alarmed at reports of a close contest, with one 
supporter saying: "The atmosphere is clearly different from the 
previous race, in which we achieved an overwhelming victory." 
 
Some are concerned about the division. An elderly man said with 
alarm, "While the two groups are locking horns, young people will 
leave the city, because the economy is in poor shape." 
 
7) Iwakuni race a dead heat 
 
YOMIURI (Page 2) (Abridged) 
February 5, 2008 
 
The city of Iwakuni in Yamaguchi Prefecture will elect its new mayor 
on Feb. 10. Candidates are now campaigning, and the Yomiuri Shimbun 
polled the city's voting population and analyzed the race. Yoshihiko 
Fukuda, 37, a new face and a former member of the House of 
Representatives, and former Mayor Katsusuke Ihara, aiming for a 
second term, are running in a dead heat. One out of every four 
voters remains undecided, so the situation is fluid. 
 
The mayoral election has kicked off due to Ihara's resignation as 
mayor. Ihara is opposed to accepting the proposed redeployment of 
U.S. carrier-borne aircraft to the U.S. Marine Corps' Iwakuni base 
along with the realignment of U.S. forces in Japan. Meanwhile, 
Fukuda is flexible about accepting carrier-borne aircraft to the 
base. The election is a one-on-one duel between the two. 
 
In the survey, local respondents were asked if they supported the 
Japan-U.S. agreement on the planned redeployment of U.S. 
carrier-borne aircraft to Iwakuni. In response, 15 PERCENT  answered 
"yes," and 31 PERCENT  said "yes, if the government revises the plan 
to reflect the opinion of local communities." Meanwhile, "no" 
accounted for 47 PERCENT . 
 
The survey was conducted Feb. 3-4 on a random digit dialing basis 
after the election was officially announced. A total of 1,251 
households were found to have one or more eligible voters, and 
answers were obtained from 815 persons (65 PERCENT ). 
 
8) Poll: 55 PERCENT  want ruling, opposition blocs to compromise on 
gas tax 
 
ASAHI (Page 1) (Abridged) 
February 5, 2008 
 
The Asahi Shimbun conducted a telephone-based nationwide public 
opinion survey on Feb. 2-3, in which respondents were asked if they 
thought the ruling and opposition parties should compromise on a 
bill revising the Special Taxation Measures Law to extend the 
current rate of temporary taxation on gasoline for another 10 years. 
In response to this question, 55 PERCENT  answered "yes," with 33 
PERCENT  saying "no." As seen from these figures, those who want the 
ruling and opposition parties to give way to each other 
substantially outnumbered those who are negative about that. 
 
TOKYO 00000291  006 OF 012 
 
 
Respondents were also asked if they thought road-related taxation 
should be continued. To this question, "yes" accounted for only 27 
PERCENT , with "no" at 60 PERCENT . In the meantime, 54 PERCENT 
support the idea of using road-related tax revenues for other 
purposes. The cabinet support rate was 35 PERCENT , leveling off 
from the 34 PERCENT  rating in the last survey conducted Jan. 
11-12. 
 
In the breakdown of public support for political parties, the ruling 
Liberal Democratic Party stood at 30 PERCENT  (26 PERCENT  in the 
January survey), with the leading opposition Democratic Party of 
Japan (Minshuto) at 24 PERCENT  (25 PERCENT  in the January survey). 
Respondents were further asked which political party they would vote 
for in their proportional representation blocs if a general election 
were held now. To this question, 30 PERCENT  chose the LDP, with 32 
PERCENT  opting for the DPJ. 
 
9) LDP in disarray over revision of gasoline tax bill, with LDP 
Upper House positive, road construction clique negative 
 
YOMIURI (Page 4) (Full) 
February 5, 2008 
 
The ruling Liberal Democratic Party (LDP) leadership has run into 
trouble in dealing with the issue of modifying a bill to amend the 
Special Taxation Measures Law that would retain the current 
provisional tax for gasoline and other road-related taxes. The 
reason is that members of the LDP caucus in the House of Councillors 
are calling for consultations with the main Democratic Party of 
Japan (DPJ or Minshuto) on revising the bill in order to make sure 
the legislation is enacted by the end of the current fiscal year. 
However, LDP lawmakers with ties to road construction interests are 
opposed to tinkering with the bill. 
 
Secretary General Bunmei Ibuki stated in a press conference Feb. 1: 
 
SIPDIS 
"We have obtained the party's approval of the present government's 
bill. We have no intention to seek a revision of the bill." 
 
The agreement between the ruling and opposition parties through the 
good offices of the leaders of the two Diet houses calls for: 1) 
reaching a certain conclusion by the end of the fiscal year; and 2) 
revising those provisions on which each party can agree. The DPJ, 
however, has asserted that the party did not agree to take a vote on 
the bill within the current fiscal year, and it is taking a stance 
of responding to revising the bill. 
 
The LDP Upper House caucus has sought a revision of the bill in the 
House of Representatives, citing that the DPJ considers a revision 
of the bill a precondition for it to respond to putting the bill to 
a vote before the end of March. 
 
Election Committee Chairman Makoto Koga, a leader of the road 
construction clique in the Diet, expressed displeasure with revising 
the bill, saying, "It is extremely regrettable that the issue of 
revising the bill is going ahead." 
 
The dominant view in the LDP is that the party will not be able to 
accept the idea of abolishing the tax revenue for road construction 
and reducing the provisional tax rates even if it agrees to 
revisions in the bill. The focus will be on whether to extend by a 
decade the provisional tax rates. 
 
 
TOKYO 00000291  007 OF 012 
 
 
The largest opposition party is, however, trying to shift its 
strategy of abolishing the provisional tax for gasoline and cutting 
gasoline prices. The reason is that it does not appear likely that 
the party will force to abolish the provisional tax rates since it 
accepted the mediation by the Lower House speaker and Upper House 
president. Appearing on an NHK talk show on Feb. 3, Vice President 
Katsuya Okada underscored: "What we want to place top priority is to 
integrate the special account of road-related taxes into the general 
account. As a result, we want to reduce the provisional tax rates." 
He made this remark to shake up the LDP since there is a view in the 
party favoring the plan of shifting the revenues for road projects 
to the general budget. 
 
10) NHK may suspend broadcasting on July 1 in aftermath of battle 
between ruling and opposition blocs in divided Diet if budget bill 
fails to get approval from opposition parties 
 
SANKEI (Page 5) (Abridged) 
February 5, 2008 
 
Personnel selection for key positions requiring Diet approval, such 
as the Bank of Japan (BOJ) governor, is drawing attention in the 
divided Diet where the ruling bloc controls the Lower House but the 
Upper House is under the opposition bloc's control. Besides, what 
will happen to a 2008 budget bill for NHK (Japan Broadcasting 
Corp.), a pending problem, is also drawing attention. The NHK budget 
bill needs to be approved by both the chambers of the Diet, but 
because the provision stipulating the Lower House's decision 
overrides a bill rejected by the Upper House is not applied to this 
budget bill as well as personnel selection requiring Diet approval, 
a worst-case scenario is that if the NHK budget bill fails to be 
approved by the Upper House, NHK may be forced to stop broadcasting 
on July 1. Although such a worst-case scenario is expected to be 
somehow avoided, the NHK budget bill is unlikely to be approved so 
smoothly, given a series of scandals involving NHK personnel. 
 
Under the Broadcast Law, NHK is obligated to obtain Diet approval 
for its budget bill as well as its business plans by the end of 
March every year. Even if the NHK budget bill is not approved (by 
the end of March), a provisional budget for NHK will be implemented 
for three months until the end of June unlike annual revenue-related 
bills (that must be passed by a fixed date). But if that happens, 
NHK will be saddled with a number of restrictions. 
 
During the implementation of the provisional budget, NHK will have 
difficulty to implement new projects and it will also find it 
impossible to hike the television reception fee. Also, NHK will be 
forced to suspend its ongoing project for constructing terrestrial 
digital broadcasting relay stations; as a result, there will be a 
significant impact on a full transition to terrestrial digital 
broadcasting in the target year of 2011. 
 
Furthermore, NHK will find it difficult to produce grand-scale 
programs, such as "NHK special," and to conclude contracts on talent 
charges. 
 
If the NHK budget bill is not approved at the end of June, more 
serious effects would arise The Broadcast Law has no rules about 
budget compilation after the provisional budget expires, and NHK is 
highly likely to be unable to collect the television reception 
fees. 
 
 
TOKYO 00000291  008 OF 012 
 
 
Although there is no law banning broadcasting if the budget bill is 
not approved, NHK may be forced to suspend broadcasting. 
 
According to a senior ruling Liberal Democratic Party (LDP) member, 
the tide of opinion in the ruling bloc is that no opposition parties 
will drive NHK into suspending broadcasting. But in March 2005, the 
opposition parties, namely, the Democratic Party of Japan (DPJ), the 
Japanese Communist Party (JCP), and the Social Democratic Party 
(SDP) were opposed to approving the 2005 NHK budget bill on the 
grounds of a former NHK chief producer having swindled money out of 
the program production budget and the problem of nonpayment of the 
television reception fees. 
 
NHK also has suffered internal dissension even now after its 
Chairman resigned in January 2005. In last December, some executive 
committee members "revolted" openly against Executive Committee 
Chairman Shigetaka Komori. In January, former NHK Chairman Genichi 
Hashimoto resigned to take the responsibility for the scandal that 
some NHK employees engaged in insider stock trading. Former Asahi 
Breweries Chairman Shigeo Fukuchi became new chairman and revamped 
the structures in the company, but some in the opposition bloc are 
still unhappy with the current NHK management. Depending on 
circumstances, NHK may be forced to drastically revise the initial 
budget bill. 
 
11) New law regulating food labeling to be enacted: Government 
considering mandating labeling imported ingredients 
 
YOMIURI (Page 1) (Full) 
February 5, 2008 
 
The government yesterday decided to establish a food labeling law by 
unifying food labeling regulations stipulated under several laws, 
including the Food Hygiene Law. The aim is to adopt an 
easy-to-understand labeling system for expiry dates, country of 
origin and other information. The move is in response to a flurry of 
false food labeling incidents. The government wants to include in 
the envisaged law a unified expiry label, by unifying two different 
standards -- an eat-by freshness date and a use-by date, a stricter 
regulation on country-of-origin labels and the confiscating of 
illegally earned profits from companies that use false information. 
It plans to submit a bill to the next regular Diet session at the 
earliest. 
 
There are five laws regulating food-labeling -- the Food Hygiene 
Law, the Japan Agricultural Standards, the Unfair Competition 
Prevention Law, the Law against Unjustifiable Premiums and 
Misleading Representations and the Measurement Law. The Ministry of 
Health, Labor and Welfare, the Ministry of Agriculture, Forestry and 
Fisheries, the Ministry of Economy, Trade and Industry and the Fair 
Trade Commission have jurisdiction on those laws. Regarding this 
situation, some have noted that there is bureaucratic sectionalism 
and that cooperation among concerned government agencies is not 
smooth. 
 
The National Life Advisory Council, a panel reporting to Prime 
Minister Fukuda, who advocates attaching importance to consumers, is 
now looking into the possibility of enacting a new law. The 
government will enter a full-fledged legislative process, based on a 
report the panel will submit in late March. 
 
There are currently two labels to indicate expiration dates -- 
 
TOKYO 00000291  009 OF 012 
 
 
use-by date for perishable food items, such as packed lunches and 
prepared foods, and eat-by freshness date for confectioneries, which 
have less possibility of causing food poisoning, though their taste 
deteriorates after the expiration date has passed. Consumers have 
complained that such a dual labeling system is difficult to 
understand. The panel is now discussing the issue with the 
possibility of unifying the two standards into a use-by date in 
order to give priority to safety. 
 
Concerning country-of-origin labeling, the panel will look into the 
possibility of mandating the labeling of country of origin of raw 
materials used for processed food products. JAS does not obligate 
country-of-origin labeling for raw materials, if they weigh less 
than half the total weight of the processed food product. In the 
food poisoning case from Chinese-made gyoza dumplings, it was found 
that pouch-packed-foods using materials produced by Tianyang Food 
Processing, the maker of the gyoza dumplings in question, had no 
label indicating that the products contain Chinese ingredients, 
indicating that key information has not been provided to consumers. 
 
The government will also consider introducing a regulation for 
confiscating profits from companies that use false information, by 
estimating profits the companies in question made unduly. 
 
12) Transport Ministry eyes restrictions on foreign ownership of 
airports -- aiming to secure postretirement posts? 
 
TOKYO SHIMBUN (Page 26) (Excerpts) 
February 25, 2008 
 
The Land, Infrastructure, and Transport Ministry is studying the 
possibility of limiting foreign stakes in the operators of major 
facilities at Haneda and Narita airports. Some argue that it could 
hamper the Fukuda administration's policy of expediting outside 
investment in Japan. Under such a situation, the ministry hopes to 
have a bill amending the Airport Development Law approved by the 
cabinet on Feb. 8. The bill includes the proposed restrictions. Many 
in the government and the Liberal Democratic Party criticize the 
proposed rules as intended to help bureaucrats secure their 
interests. 
 
A government source grumbled: "What officials in the Transport 
Ministry want to protect by introducing restrictions are their 
lucrative postretirement positions, that is, executive posts at 
companies linked to both Haneda and Narita airports. 
 
The Koizumi administration decided in a cabinet meeting in 2002 to 
turn the predecessor of Narita International Airport Corp., which 
operates Narita Airport, into a special corporation in the process 
of privatizing it in the future. In 2004, the administration 
transformed the company into a special corporation financed 100 
PERCENT  by the government. The government is aiming to privatize it 
sometime after next fiscal year. But the ministry is concerned that 
it might lose its important retirement posts if foreign firms 
acquire large shares in airport operators. 
 
Three of the 13 executives in Narita International Airport Corp. 
came from the Transport Ministry. Among the remainder, there is also 
a former National Police Agency official and a former National Tax 
Administration official. The total amount of annual salary paid to 
the 13 executives is 286 million yen, an average of 22 million yen. 
 
 
TOKYO 00000291  010 OF 012 
 
 
Among all government agencies, the Transport Ministry has secured 
the largest number of post-retirement jobs for its officials. A 
ministry official said: "Narita is a very lucrative company for 
retired ministry bureaucrats." 
 
Last summer, an Australian investment fund purchased nearly 20 
PERCENT  of the shares in Japan Airport Terminal Co. (JAT) and 
became the biggest shareholder. This move prompted the Transport 
Ministry to move to place restrictions on foreign firms. JAT 
operates Haneda Airport and is listed on the First Section of the 
Tokyo Stock Exchange. 
 
A ministry official commented: "Haneda and Narita are key 
infrastructure. To dispel concerns about the safety of airports, it 
is necessary to place certain restrictions on foreign ownership." 
The ministry is considering holding foreign ownership of four 
airports -- three firms linked to Haneda, including JAT, and Narita 
International Airport -- to less than one-third in terms of voting 
rights. 
 
However, LDP House of Representatives member Hiroshige Sekou has 
continued to oppose the proposed regulations, arguing: "The logic of 
the Transport Ministry, which brandishes the word 'safety', is 
irrational." 
 
Citing an incident in July 1999 in which an ANA airplane left Haneda 
for New Chitose was hijacked and its captain killed, Sekou 
emphasized in a meeting of the LDP Land and Transport Department: 
"The main cause for the incident was the lax security system at 
Haneda Airport. Ownership of foreign companies and air safety have 
nothing to do with each other." 
 
Sekou also pointed out that 75 PERCENT  of total revenues earned by 
JAT are from sales of goods at Haneda, Kansai, and Chubu airports. 
He then assured: "I wonder why foreign-ownership regulations are 
necessary on sales of goods. After all, what the ministry wants to 
protect are postretirement jobs." Former Deputy Vice Transport 
Minister Katsuji Doi is now vice president at JAT. 
 
The restriction plan contradicts the Fukuda administration's goal of 
promoting foreign investment in Japan. Financial Services Minister 
Yoshimi Watanabe is also critical of the plan, arguing: "The 
proposed rules go against the national strategy of strengthening 
Japan's capital market and expediting foreign investment." 
 
According to a survey by the Transport Ministry, only Thailand has 
placed almost the same level of restrictions on foreign ownership of 
airports as the rules now under consideration in Japan. Thailand 
limits foreign ownership to less than 5 PERCENT . A government 
source commented: "Restricting foreign capital is indisputably a 
sort of discrimination toward foreigners. The Japanese government 
has called in trade negotiations of the Association of Southeast 
Asian Nations (ASEAN), including Thailand, for easing or abolishing 
all measures to protect their domestic firms. It is a bad joke for 
the government to introduce restrictions, following Thailand." 
 
13) Japan to double ships in 5 yrs 
 
YOMIURI (Page 2) (Full) 
February 5, 2008 
 
The government's ocean policy task force, headed by Prime Minister 
 
TOKYO 00000291  011 OF 012 
 
 
Fukuda, has worked out a draft of its basic oceanic plan for Japan's 
ocean policy. The draft basic plan, revealed yesterday, notes that 
the number of ships under the flag of Japan has been decreasing. As 
it stands, the draft plan sets numerical benchmarks to attain. In 
concrete terms, the draft plan suggests the need for Japan to double 
its holding of ships in five years. In addition, the draft plan 
proposes increasing the number of Japan's ocean line seafarers by 50 
PERCENT  in 10 years. The government will also work out a plan 
within fiscal 2008 for Japan's development of marine energy and 
mineral resources, including oil and natural gas. The draft plan is 
expected to be adopted in a cabinet meeting this month. 
 
The draft basic plan for Japan's ocean policy is based on the Basic 
Act on Ocean Policy, which was enforced in July last year. The basic 
plan is intended to unify the government's ocean policy measures 
that are currently in the hands of its ministries. The government 
will review its ocean policy in five years. 
 
Japan's holding of ocean liners is now below 1,000 as of 2006. The 
number of Japanese seamen is also below 3,000. "Japan depends 
largely on ocean shipping," the draft plan notes. "This situation is 
therefore problematical for Japan from the perspective of ensuring 
ocean shipping," it adds. The government will lighten or reduce 
taxes on Japanese shipping companies to increase their ships and 
seafarers. 
 
In addition, the draft basic plan stresses that it is "vital" for 
Japan to probe and exploit marine energy and mineral resources. In 
this regard, the basic plan suggests the need for government 
ministries and agencies to work together and formulate a "marine 
energy and mineral resources development plan" within fiscal 2008. 
This development plan is to prescribe a blueprint of projects for 
Japan's exploitation of marine resources as well as technology 
development needed for Japan to exploit marine resources. 
 
Furthermore, the draft basic plan says Japan, for the time being, 
will need to probe and exploit marine resources in its exclusive 
economic zone (EEZ) waters, pinpointing: 1) petroleum; 2) natural 
gas; 3) methane hydrate; and 4) sea-floor hydrothermal deposits, 
including rare metals. The basic plan says the government should 
intensively invest its policy-based resources as necessary. It also 
sets a goal for Japan to head for its commercialization of methane 
hydrate and sea-floor hydrothermal deposits in about 10 years. 
 
14) Kyoto Prefecture to launch CO2 reduction bank: Company to 
purchase emissions reduced by households 
 
MAINICHI (Page 2) (Full) 
February 5, 2008 
 
Kyoto Prefecture on February 4 released a plan to start a Kyoto CO2 
Reduction Bank, an emissions quota transactions system allowing 
companies to purchase carbon dioxide (CO2) emissions cut by 
households, staring this fiscal year. Under the system, each 
household registers with the bank and obtains points, according to 
the amount of CO2 it has cut. It can use the points at registered 
neighborhood stores. Companies that purchased emissions credits can 
count them as emissions cuts. The registered stores would receive 
the payment for goods they sold through the bank. Kyoto is the first 
area to adopt such a system, according to the prefecture. 
 
Kyoto Prefecture has adopted a regulation on measures to combat 
 
TOKYO 00000291  012 OF 012 
 
 
climate change. It seeks to have leading companies cut CO2 emissions 
by 10 PERCENT  by 2010, compared with 1990 levels. The envisaged 
system would benefit both companies and households and would 
stimulate local shopping areas. 
 
The prefecture will establish the bank in April and invite 
households and companies to register. Emissions trading will start 
this fall. It expects that about 3,000 households and 20-30 
companies will take part, enabling the reduction of 1,200 tons of 
CO2 emissions a year. 
 
The amount of cuts achieved by households will be confirmed using 
the amount of electricity and gas they use compared with the 
previous year. The prefecture calculated that a company would 
purchase a 1 kg cut for 5 yen. An average household that emits 4 
tons of CO2 a year could obtain points worth 2,000 yen if it cuts 
emissions by 10 PERCENT . A credit card will be used for shopping at 
registered stores. 
 
SCHIEFFER