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UNCLAS SECTION 01 OF 12 TOKYO 000501 
 
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 03/05/09 
 
Index: 
 
1) Top headlines 
2) Editorials 
 
3) U.S. Special Representative Bosworth and China's foreign minister 
agree on position opposing North Korean missile launch  (Asahi) 
 
Anti-piracy operations: 
4) Bill to create legal system to deal with piracy is ready in 
outline, will make "piracy" a crime for the first time, and be 
adopted by the Cabinet next week  (Asahi) 
5) Defense Ministry is dissatisfied with parts of the new draft 
legislation allowing anti-piracy operations  (Mainichi) 
 
Ozawa scandal: 
6) Crooked construction company, Nishimatsu, funneled 300 million 
yen in illegal donations over 10 years to Democratic Party of Japan 
(DPJ) head Ichiro Ozawa  (Tokyo Shimbun) 
7) Ozawa's secretary directly received illegal political donations 
and provided receipts for them  (Mainichi) 
8) Ozawa's secretary coordinated with the construction company ahead 
of time to determine the size of the donation  (Asahi) 
 
9) Former Prime Minister Mori also received donations from 
Nishimatsu's political organization but claims his side was unaware 
they were illegal  (Tokyo Shimbun) 
10) In the past three years, 18 politicians other than Ozawa have 
been caught taking shady political donations  (Yomiuri) 
11) Calls for Ozawa to quit continue  (Yomiuri) 
 
Political agenda: 
12) Ozawa scandal has quieted down the clamor in the ruling Liberal 
Democratic Party for Prime Minister Aso to step down  (Asahi) 
13) Second stimulus package with cash-handout program finally passes 
the Diet by an override revote in the Lower House, with former 
premier Koizumi absent  (Nikkei) 
 
Economy: 
14) Computer simulation shows that the government's stimulus package 
that includes cash handouts will have only a slight effect on 
boosting the economy  (Asahi) 
15) "Ozawa shock" rattles fears in the markets setting off a wave of 
"Japan selling"  (Sankei) 
 
16) JICA head Ogata named as special envoy to Afghanistan and 
Pakistan  (Mainichi) 
 
17) Government to propose to IWC a scaling down of its research 
whaling  (Asahi) 
 
Articles: 
 
1) TOP HEADLINES 
 
Asahi: 
Ozawa's arrested aide made coordination with Nishimatsu Construction 
side on donations 
 
Mainichi: 
Law enacted to implement contentious cash handout plan 
 
 
TOKYO 00000501  002 OF 012 
 
 
Yomiuri: 
Ozawa side, Nishimatsu Construction agreed on annual 25 million yen 
donations 
 
Nikkei: 
Mitsubishi eyeing solar power with stake in Spanish firm 
 
Sankei: 
Ozawa's secretary suspected of acting as intermediary for Nishimatsu 
Construction to receive orders for dam construction projects 
 
Tokyo Shimbun: 
Nishimatsu Construction donation scandal: 300 million yen donated to 
Ozawa side 
 
Akahata: 
Ozawa side suspected of demanding donations 
 
2) EDITORIALS 
 
Asahi: 
(1) Nishimatsu Construction scandal: DPJ President Ozawa cut off his 
retreat 
(2) Cash handout costing 2 trillion yen: We wanted use that money in 
a wiser way 
 
Mainichi: 
(1) Ozawa's press conference will not satisfy people 
(2) Cash handout scheme: Pork-barrel budget has been enacted 
 
Yomiuri: 
(1) Ozawa's press conference has not cleared suspicion 
(2) Settlement of cash handout scheme: Do not repeat policy 
confusion 
 
Nikkei: 
(1) Press ahead with additional stimulus package that will boost 
growth in bold manner 
(2) Was Ozawa's account persuasive? 
 
Sankei: 
(1) Press conference by Ozawa: We seek DPJ to make self-help effort 
(2) Cash handout plan: Hurry to take economic stimulus measures 
toward the end of fiscal year 
 
Tokyo Shimbun: 
(1) Ozawa rebuts: DPJ's crisis management to be called into 
question 
(2) Cash handouts to be distributed: Political deterioration 
pronounced 
 
Akahata: 
(1) Nishimatsu Construction's camouflage donations: Dispelling 
doubts is politicians' primary responsibility 
 
3) U.S. Special Representative Bosworth and China's foreign minister 
agree on position opposing North Korean missile launch 
 
ASAHI (Page 9) (Full) 
March 5, 2009 
 
By Hiroshi Ukai in Beijing 
 
TOKYO 00000501  003 OF 012 
 
 
 
Special Representative of the U.S. Government for North Korea Policy 
Bosworth met on the 4th with China's Foreign Minister Yang Jiechi. 
They continued the conversation started the day before with Vice 
Foreign Minister Wu Dawei, who is the chief delegate to the 
Six-Party Talks. According to Bosworth, through the series of 
meetings, there was mutual agreement in views of opposition to a 
North Korea missile launch as "undesirable."  In addition, the 
Chinese side reportedly agreed on the need to restart as quickly as 
possible the Six-Party Talks. 
 
Bosworth will arrive in Japan today and after that visit South 
Korea. In order to demonstrate the U.S. stance of giving priority to 
the denuclearization of the Korean Peninsula, "there was a request 
to President Obama and Secretary Clinton for me to visit as soon as 
possible after being appointed," he said. But as for any plans to 
contact North Korea, he said there "are none at this time." 
 
4) Charges eyed for pirates 
 
ASAHI (Page 4) (Full) 
March 5, 2009 
 
The government yesterday outlined a bill for a law concerning 
punishment for piracy and measures against piracy. The newly planned 
law will establish charges for piracy and stipulate antipiracy 
operations as additional overseas activities for the Self-Defense 
Forces. The legislative measure authorizes the SDF to use weapons 
overseas to an expanded scope, allowing the SDF to fire on pirate 
ships refusing orders to stop. 
 
The government will make a cabinet decision next week to adopt the 
bill, aiming to enact it into law during the current Diet session. 
Concurrently, the government will invoke an action for maritime 
security operations under the Self-Defense Forces Law. Maritime 
Self-Defense Force destroyers will set sail March 14 to head for 
waters off the coast of Somalia. After the antipiracy law is 
enacted, the MSDF's deployment for maritime security operations off 
Somalia under the SDF law will be switched to antipiracy operations 
under the new law. 
 
The outlined bill refers to the United Nations Convention on the Law 
of the Sea (UNCLOS) that requires all countries to cooperate to the 
fullest possible extent in the repression of piracy on the high seas 
or in any other place outside the jurisdiction of any country. In 
this connection, the bill is Japan's first legislative measure to 
stipulate punishment for piracy. The new law will stipulate that 
those who committed piracy will be imprisoned for life or sentenced 
to a penal servitude of five or more years. Those who killed a 
person will be sentenced to death or life imprisonment. 
 
The bill says the Japan Coast Guard will primarily be tasked with 
antipiracy counteractions. If there is a "special need" that cannot 
be met by the JCG, the defense minister, with the prime minister's 
approval, may send out the SDF. In that case, the defense minister 
will submit an outline of counteractions to the prime minister, 
specifying the scale of SDF deployment for antipiracy operations as 
well as where and how long the SDF's antipiracy operations will be 
conducted. Concerning the Diet's commitment, the bill stipulates 
that the government must report its SDF deployment plan to the diet 
without delay after the prime minister approves it. The SDF will be 
allowed in principle to use weapons under the currently existing 
 
TOKYO 00000501  004 OF 012 
 
 
police duty execution law's Article 7 provisions that limit the use 
of weapons to legitimate self-defense or some other cases. However, 
the SDF will be allowed to fire on vessels in order to halt them in 
the case where these vessels keep closing in on merchant ships, 
tailing merchant ships, or standing in the way of merchant ships 
while refusing SDF orders to stop. 
 
Main points from antipiracy legislation 
 
Purpose: The antipiracy law purports to stipulate matters needed for 
Japan to take appropriate and effective actions against piracy and 
maintain public safety and order at sea. 
 
Piracy and its definition: The antipiracy law defines piracy as 
boarding a ship on the high seas or elsewhere for private purposes, 
and: 1) seizing or controlling a ship at sea; 2) seizing a ship's 
properties; 3) abducting anyone onboard a ship, or 4) taking hostage 
to demand properties and the like; and also for any of the first 
four purposes, 5) breaking into a ship or damaging a ship; 6) 
extremely closing in on a ship; or 7) sailing at sea with weapons 
prepared. 
 
Charges for piracy: The first four acts are subject to life 
imprisonment or a penal servitude of five or more years. Those who 
injured a person will be imprisoned for life or get six or more 
years. Those who killed a person will be sentenced to death or life 
imprisonment. Those in the fifth or sixth case will be sentenced to 
a prison term of up to five years. Those in the seventh case will be 
sentenced to a prison term of up to three years. 
 
Authorization for weapons use: The SDF will be allowed to use 
weapons under the police duty execution law. In addition, the SDF 
may use weapons in order to halt pirate ships if they refuse orders 
to stop. 
 
Antipiracy actions: The defense minister will prepare an outline of 
counteractions against piracy, and with the prime minister's 
approval, may order the SDF to conduct counteractions. The prime 
minister will submit a report to the Diet when approving the defense 
minister's request for approval and after ending the SDF's 
counteractions. 
 
5) Defense ministry unhappy with legal endorsement of SDF's 
antipiracy mission 
 
MAINICHI (Page 2) (Abridged) 
March 5, 2009 
 
The government yesterday presented the ruling coalition's project 
team with an antipiracy bill for measures against pirates in waters 
off the eastern African coast of Somalia. This legislation is aimed 
at legally endorsing the Self-Defense Forces' ocean-going antipiracy 
mission, which is said to be an act of circumventing the 
Self-Defense Forces Law in the case of maritime security operations 
under the SDF law as noted by a high-ranking government official. 
Concerning guidelines for the use of weapons in focus, government 
leaders at the prime minister's office and the New Komeito, the 
ruling Liberal Democratic Party's coalition partner, want to 
restrict the SDF's use of weapons overseas-or the rules of 
engagement (ROE)-within the bounds of the current law. However, the 
Defense Ministry insisted on the need to explicitly ease the 
government's guidelines for the SDF to use weapons overseas. As it 
 
TOKYO 00000501  005 OF 012 
 
 
stands, the two sides faced rough going in their coordination. In 
the end, they concurred on allowing the SDF to only fire on pirate 
ships in order to halt them if they keep closing in on merchant 
ships, a case outside the current law. 
 
The New Komeito is sensitive to constitutional issues, so the prime 
minister's office stuck to the currently existing police duty 
execution law's Article 7 provisions that will be applied to the 
SDF's maritime security operations overseas for an antipiracy 
mission. However, the Defense Ministry anticipated specific cases, 
maintaining that pirates could ignore a warning and keep closing in 
on merchant ships and that they could rope up a merchant ship. Given 
such cases, the Defense Ministry has brought a countercharge, taking 
the position that the SDF will waver in its judgment under the 
current guidelines. For this reason, Defense Ministry officials are 
dissatisfied with the bill. "It's not easing the guidelines so 
much," a top-level official of the ministry said. The official 
added, "It won't lead to discussions on a permanent law (which will 
prescribe general requirements for the SDF's overseas activities)." 
 
6) Donations from Nishimatsu to Ozawa office total 300 million yen 
 
TOKYO SHIMBUN (Top Play) (Full) 
March 5, 2009 
 
Nishimatsu Construction Co., a second-tier general contractor, 
formed a framework for its donations to Democratic Party of Japan 
(DPJ) President Ichiro Ozawa's fund-managing organization more than 
10 years ago, according to persons involved in the case. The body 
received a total of 25 million yen from the company annually through 
dummy political groups and even from its subcontractor. The total 
amount of donations provided by the company over ten years reaches 
300 million yen. To unveil the actual state of the donations 
extended over a long period of time, the special investigation squad 
of the Tokyo District Public Prosecutors Office intends to question 
Ozawa about the details of the case. 
 
Prosecutors to question Ozawa 
 
According to persons concerned, Nishimatsu was also offering the 
money collected from a subcontractor with which the company, besides 
donations through dummy political organizations. The donations from 
the political bodies and from the subcontractor annually totaled 15 
million yen and 10 million yen, respectively. 
 
With donations from Nishimatsu itself included, the total amount is 
approximately 300 million yen over 10 years. 
 
It has already been found that donations through the two dummy 
groups amounted to a total 83 million yen between 2003 and 2006 and 
that Shoei Real Estate Co., Nishimatsu's 100 PERCENT -financed 
subsidiary, donated more than 10 million yen since 1995. 
 
Ozawa's fund-management organization and Nishimatsu set this 
framework of donations in response to Ozawa side's request a dozen 
or so years ago. 
 
Since Takanori Okubo, Ozawa's first state-funded secretary who was 
arrested on suspicion of violating the Political Funds Control Law, 
assumed the post of taking charge of accounting for Ozawa's 
political fund-management body, Rikuzan-kai, in 2000, he discussed 
the details of donations with executives of Nishimatsu, according to 
 
TOKYO 00000501  006 OF 012 
 
 
persons concerned. 
 
Alleging that Okubo knew the donations amounting to 25 million yen 
annually actually came from Nishimatsu, prosecutors seem to be 
judging it inevitable to question Ozawa in order to uncover the 
illegal donation system. 
 
7) Ozawa's secretary asked Nishimatsu for donations, setting certain 
amount 
 
MAINICHI (Page 1) (Excerpts) 
March 5, 2009 
 
It is alleged that Democratic Party of Japan (DPJ) President Ichiro 
Ozawa's fund-managing organization received some of the donations by 
Nishimatsu Construction Co., a second-tier construction company, 
directly from its incumbent executives, according to persons 
involved in the case. On suspicion of receiving illegal political 
donations, Takanori Okubo, Ozawa's first state-funded secretary, was 
arrested in violation of the Political Funds Control Law. It has 
also been unveiled that Okubo had sent written requests to the 
company for donations, setting a certain amount. The special 
investigation squad of the Tokyo District Public Prosecutors Office 
alleges that Okubo received the donations while knowing that the 
money came from Nishimatsu. 
 
Okubo received a total of 21 million yen from Nishimatsu between 
2003 and 2006, when he was in charge of accounting for Ozawa's 
political fund-management body. Prosecutors allege that while Okubo 
knew the money came from Nishimatsu, he falsely recorded in the 
body's financial statement that the money came from two political 
groups established by an ex-executive of Nishimatsu, both disbanded 
in 2006. The two associations are Shin-Seiji Mondai Kenkyu-kai (New 
Political Issues Study Association) and Mirai Sangyo Kenkyu-kai 
(Future Industry Study Association). Okubo reportedly has denied the 
allegations. 
 
According to persons connected to Nishimatsu, in the case of 
offering donations to politicians, the company transferred the money 
to their bank accounts in the names of the two associations. But 
there were cases in which company executives brought money directly 
to their offices. Former Nishimatsu President Mikio Kunisawa, who 
was arrested with Okubo, decided on amounts and destinations of 
donations, according to informed sources. 
 
Okubo sent requests for donations to the company in the name of 
Rikuzan-kai, and the company gave the donations through the two 
associations. 
 
8) Ozawa's arrested secretary coordinated with Nishimatsu 
Construction on donations 
 
ASAHI (Top play) (Excerpts) 
March 5, 2009 
 
Democratic Party of Japan President Ichiro Ozawa's first 
state-funded secretary Takanori Okubo, 47, who also serves as chief 
accountant of Ozawa's fund-management body, Rikuzankai, has been 
arrested on suspicion of receiving illegal donations. Okubo annually 
sent Nishimatsu Construction Co. requests for donations to 
Rikuzankai and the DPJ's local chapter after holding talks with 
Akifumi Okazaki, 67, who was serving as the company's general 
 
TOKYO 00000501  007 OF 012 
 
 
affairs department chief, it has been learned. Okubo allegedly set 
the total amount of annual donations from Nishimatsu to the Ozawa 
side at 25 million yen. 
 
The special investigation squad of the Tokyo District Public 
Prosecutors Office has learned such events from persons connected 
with Nishimatsu. Prosecutors apparently think that such developments 
prove Okubo's active involvement in the donation scandal, in which 
he allegedly falsified records to make it appear that the money came 
from political organizations. Okubo has denied the charges. 
 
According to the investigation, Okubo allegedly falsely listed in 
Rikuzankai's political fund report for a period between 2003 and 
2006 a total of 21 million yen in donations from Shin-Seiji Mondai 
Kenkyu-kai (New Political Issues Study Association) and Mirai Sangyo 
Kenkyu-kai (Future Industry Study Association) -- both were dummy 
political groups headed by former Nishimatsu executives - knowing 
full well that the money was actually a political donation from 
Nishimatsu. The Political Funds Control Law prohibits donations 
under the name of a different person and corporate donations, except 
those made to political parties. 
 
According to a connected source, Nishimatsu began making donations 
to the Ozawa side from around 1995 when Shin-Seiji Mondai Kenkyu-kai 
was established with the aim of winning orders for large projects, 
such as dams, in the Tohoku region. The Ozawa office allegedly made 
coordination with Nishimatsu around that time and decided to set the 
total annual donation at 25 million yen and on allocating the money 
to Rikuzankai and the Ozawa-headed DPJ regional chapter. The 
arrangement was made to avoid the close ties with the Ozawa side 
becoming conspicuous. 
 
9) Former Prime Minister Mori, other LDP lawmakers received 
donations from Nishimatsu say, "Properly filed," "Don't know where 
donations came from" 
 
TOKYO SHIMBUN (Page 1) (Full) 
March 5, 2009 
 
Liberal Democratic Party (LDP) lawmakers, who had received donations 
from the political organizations headed by former Nishimatsu 
Construction Co. officials, yesterday underscored differences 
between their cases and that of Democratic Party of Japan (DPJ) 
President Ichiro Ozawa, whose chief public secretary has been 
arrested (on suspicion of violating the law), with one member 
saying, "I have handled the money properly." Another said: "I did 
not know where the donations came from." 
 
Shunichi Yamaguchi, advisor to the prime minister, whose political 
fund-management organization had received 2 million yen in donations 
in 2004, expressed his intention return the money. He told reporters 
yesterday afternoon: "Usually we don't know whether donors are doing 
illegal things." 
 
Koji Omi, former finance minister, who had filed in reports on 
political funds to the government in 2004 and 2005 that a total of 4 
million yen was donated from Nishimatsu, said: "I have properly 
reported in accordance with the Political Funds Control Law. 
 
Lower House member Koichi Yamamoto, from whom Nishimatsu had 
purchased party tickets totaling 1 million yen in 2004, said: "I 
have reported that everything has been filed properly in accordance 
 
TOKYO 00000501  008 OF 012 
 
 
with the law." 
 
Former Prime Minister Yoshiro Mori's political fund-management 
organization wrote in political fund reports submitted in 2004 and 
2005 that a total of 3 million yen was donated. Mori released a 
statement through his lawyer that went: "I did not know at all and I 
even don't know now how the donation money was made." 
 
Tokio Kano, senior vice minister of economy, trade and industry, who 
sold party tickets totaling 2 million yen to Nishimatsu in 2004, 
said: "Since I consider (party tickets) as costs for wining and 
dining and information fees, I will not return the money." 
 
10) 18 lawmakers, besides Ozawa, received donations from Nishimatsu 
in three years 
 
YOMIURI (Page 39) (Full) 
March 5, 2009 
 
Nishimatsu Construction Co. besides Democratic Party of Japan (DPJ) 
President Ichiro Ozawa donated a total of approximately 61 million 
yen to the political fund-management organizations of 18 ruling and 
opposition party lawmakers, and factions in the Liberal Democratic 
Party (LDP) for three years until 2006 through its dummy political 
groups -- Shin Seiji Mondai Kenkyu Kai and Mirai Sangyo Kenkyu Kai. 
The 61 million yen total includes 4 million yen to the political 
fund-management body of former Finance Minister Koji Omi, an LDP 
member; and 4 million to the political fund-management organization 
and former transport minister Takao Fujii, LDP member and to a LDP 
prefectural chapter. 
 
Political donations to main Diet members by Nishimatsu 
Construction's dummy political groups 
 
Diet member Party Amount of donations 
Ichiro Ozawa 
(Lowe House member) DPJ 14 million yen (G) 
10 million yen (P) 
Koji Omi 
(Lower House member) LDP 4 million yen (G) 
Takao Fujii 
(Upper House member) LDP 1 million yen (G) 
3 million yen (P) 
Kimitaka Fujino 
(ex-Upper House member) LDP 4 million yen (P) 
Yoshiro Mori 
(Lower House member) LDP 3 million yen (G) 
Kenji Yamaoka 
(Lower House member) DPJ 2 million yen (G) 
Hideo Watanabe 
(Upper House member) Reform Club 2 million yen (P) 
Shunichi Yamaguchi 
(Lower House member) LDP 2 million yen (G) 
 
N.B.: (G) indicates lawmakers' political fund-management bodies to 
which donations are prohibited; and (P) indicates party's 
prefectural chapters headed by Diet members. 
 
11) Doubts about Ozawa grow; Argument of his possible resignation 
simmering in DPJ 
 
YOMIURI (Page 1) (Full) 
 
TOKYO 00000501  009 OF 012 
 
 
March 5, 2009 
 
Democratic Party of Japan (DPJ) leader Ichiro Ozawa's 
fund-management organization, Rikuzankai, sent Nishimatsu 
Construction Co. requests for donations before receiving 
contributions in violation of the Political Funds Control Law, it 
became clear yesterday. This has raised doubts in the DPJ about 
Ozawa's handling of political funds. There are still calls for 
Ozawa's voluntary resignation. 
 
The DPJ held yesterday separate meetings of its Upper House and 
Lower House members. As a result, the DPJ lawmakers confirmed a 
policy direction to remain united under President Ozawa based on the 
fact that he has denied the illegality of donations in a press 
conference and other venues. Secretary General Yukio Hatoyama played 
up the injustice of the investigation, saying: "With the next Lower 
House election near at hand, it is natural to generate speculation 
that the prosecutors had a political intent." 
 
The party also sent a message to those running in the next Lower 
House on the DPJ ticket what Ozawa had stated in the press 
conference in outline, along with the secretary general's statement 
describing the investigation as "regrettable." Owning partly to the 
party leadership's strong efforts to prevent internal conflicts, 
there are no calls for Ozawa's swift resignation. 
 
Nevertheless, the new facts that have emerged about Rikuzankai after 
Ozawa's press conference are rocking the party significantly. A 
member critical of the party leadership said: "If there is 
contradiction to Mr. Ozawa's explanation that he did not regard the 
money as corporate donations, he would not be able to stay in his 
post." 
 
Another member said: "Was there any need to criticize the 
prosecutors by receiving Mr. Ozawa's assertion on faith? If Mr. 
Ozawa was forced to resign, the whole party's responsibility would 
be questioned." 
 
12) Dump-Aso movement subsides after cash handout program settled; 
Once-in-a million chance arises to damage DPJ 
 
ASAHI (Page 4) (Excerpts) 
March 5, 2009 
 
With a change in the tide following the arrest of the state-paid 
secretary of Democratic Party of Japan President Ichiro Ozawa, bills 
related to the fiscal 2008 second supplementary budget were 
readopted yesterday by the House of Representatives without any 
upsets. Moves to unseat Prime Minister Taro Aso have also subsided 
temporarily, and there is a strange mood in the ruling bloc favoring 
prolonging the life of the Aso administration. Nevertheless, there 
still remains discontent underneath that the ruling parties cannot 
fight the upcoming election under Prime Minister Aso. 
 
After Ozawa's press conference, New Komeito deputy head Toshiko 
Hamayotsu called for his resignation, saying to reporters: "(Mr. 
Ozawa's words that described the investigation as unjust) were 
nothing but a delusion of persecution to avoid his responsibility. 
His responsibility is serious. He should resign as leader (of the 
DPJ)." 
 
But voices calling for Ozawa's immediate resignation are a minority 
 
TOKYO 00000501  010 OF 012 
 
 
in the ruling bloc. Liberal Democratic Party Lower (LDP) House 
member Masazumi Gotoda said: "For the ruling parties, it's not good 
for (Mr. Ozawa) to resign." 
 
For the ruling camp, which has long struggled with the Aso 
administration's dwindling support ratings, Ozawa's donation scandal 
is a chance in a million. 
 
As seen in former LDP Secretary General Taku Yamasaki's comment, "We 
should call him to the Diet to have him tell the truth," the ruling 
bloc apparently wants to deliver a damaging blow to the DPJ as long 
as possible. 
 
13) Cash handout bill clears Diet; Koizumi, Ono abstain from casting 
ballots 
 
NIKKEI (Page 1) (Excerpts) 
March 5, 2009 
 
A bill to finance the fiscal 2008 second supplementary budget, which 
includes the cash-handout program and express way toll discount 
plan, yesterday cleared the Diet. It was readopted by the House of 
Representatives with a two-thirds majority of lawmakers from the 
ruling Liberal Democratic Party (LDP) and its coalition partner New 
Komeito voting. Following the passage of the legislation, the 
municipalities will speed up the work of providing the money to 
their residents. The outlook is that some municipalities will start 
offering cash payments today, but most of them will initiate the 
provision in April or later. 
 
The LDP and New Komeito rammed the legislation through the Lower 
House with a two-thirds majority vote, overriding the rejection by 
the House of Councillors, as they had done so last December when the 
refueling mission law was extended and the Financial Functions 
Strengthening Law was revised. It took more than six months for the 
bill to clear the Diet since some in the ruling coalition had come 
up with the notion of slashing taxes, the original idea for the 
cash-handout program. 
 
The main opposition Democratic Party of Japan (DPJ), the Japanese 
Communist Party, the Social Democratic Party and the People's New 
Party rejected the bill in yesterday's Lower House plenary session. 
The bill was approved by a 333 to 136 vote. Former Prime Minister 
Junichiro Koizumi, who had raised eyebrows by opposition the bill, 
skipped the session. Jiro Ono, one of Koizumi's former secretaries, 
walked out of the session to abstain from voting. The LDP leadership 
did not punish Koizumi, who had submitted a notification of absence, 
but it punished Ono by giving him a warning. 
 
Under the cash-handout program, individuals will receive 12,000 yen 
(about $120) each and those aged 18 and younger and those aged 65 
and older will be additional 8,000 yen. The villages of Nishiokoppe 
in Hokkaido and Nishimeya in Aomori Prefecture will start today 
offering the money to their residents. Although most municipalities 
will begin to offer payments in April, some municipalities might do 
so in May after the Golden Week holidays. 
 
14) Second extra budget likely to have only slight effect on buoying 
up economy 
 
ASAHI (Page 6) (Abridged slightly) 
March 5, 2009 
 
TOKYO 00000501  011 OF 012 
 
 
 
With the enactment of bills related to the fiscal 2008 second 
supplementary budget on March 4, it is now possible to implement the 
overall budget. The showcase of the budget is an economic stimulus 
package, including a cash handout scheme and a cut in highway tolls, 
which the government proposed even at the cost of drawing critics 
that it is a pork-barrel budget. However, the ripple effect is 
limited. Since the economic decline is accelerating, the idea of 
another major stimulus package is being considered. 
 
The economic stimulus package incorporated in the second extra 
budget costs approximately 5 trillion yen. The budget was enacted in 
late January. However, the enactment of legislation for drawing 
financial resources worth 4.2 trillion yen from reserves in the 
special fiscal investment and loans program account has been 
delayed. For this reason, only several hundred-billion yen worthy of 
projects, such as making school buildings earthquake-proof and 
repairing the damage wrought by natural disasters financed by 
construction government bonds, have started. 
 
Following the passage of related bills, the government will hurry to 
execute the remaining budgets. Some municipalities will start 
distributing flat-sum cash handouts before the end of this month. A 
measure to set a highway tolls in local regions at a flat rate of 
1,000 yen on Saturdays, Sundays and national holiday will also be 
implemented starting on the 28th. 
 
However, those measures are not sufficient in preventing the economy 
from further deteriorating. According to projections by private 
think-tanks, the growth of the economy in fiscal 2008 will likely be 
minus 3 PERCENT . The second supplementary budget's effect of 
boosting the economy is only 0.2 PERCENT , according to an estimate 
made by the Nomura Securities Financial and Economic Research 
Center. 
 
15) News of Ozawa aide scandal triggers selling of yen, bringing up 
dollar to near 100-yen line 
 
SANKEI (Page 2) (Excerpts) 
March 5, 2009 
 
The effect of the scandal over the arrest of the top aide to 
Democratic Party of Japan President Ozawa spread to the financial 
market yesterday. The U.S. dollar rose by more than 1 yen over the 
previous day on the Tokyo Foreign Exchange Market. In early 
February, the dollar stayed at the level of 89 yen to the dollar, 
but the dollar gained about 10 yen over the past month on growing 
public distrust in politics, caused by former Finance Minister 
Shoichi Nakagawa's resignation and now the Ozawa scandal. Many 
observers in the financial markets anticipate that the dollar may 
climb to the level of about 100 yen. 
 
On the 3rd, when the offices related to Ozawa were searched by 
prosecutors, the dollar rose more than 0.5 yen to the first half of 
the 98 yen level in New York. In Tokyo on the 4th, as well, the 
dollar fetched 98.82-84 yen, 1.07 yen down as of 5:00 p.m. from the 
previous day. In London and New York on the 4th, the dollar briefly 
climbed to a near 4-month high of the 99 yen level. 
 
16) Ogata named envoy for Afghan affairs 
 
MAINICHI (Page 5) (Full) 
 
TOKYO 00000501  012 OF 012 
 
 
March 5, 2009 
 
Prime Minister Taro Aso yesterday appointed Sadako Ogata, president 
of the Japan International Cooperation Agency (JICA), to the post of 
special envoy to Afghanistan and Pakistan. Ogata will shortly visit 
the United States to hear the U.S. government's views regarding 
assistance and other matters. 
 
Ogata, after meeting Aso at his office yesterday, told reporters: 
"The situation in Pakistan will have sizable repercussions on 
Afghanistan. I'd like to talk about what we can do and how the 
United States will move." 
 
17) Government plans to shrink whaling research program: Also 
considering submitting the plan to IWC 
 
ASAHI (Page 6) (Full) 
March 5, 2009 
 
The Ministry of Agriculture, Forestry and Fisheries has compiled a 
plan to cut back on the number of catches in future research whaling 
programs. With this, the government is now considering taking part 
in discussion at an interim meeting of the international Whaling 
Commission (IWC) to be held in Rome starting on March 9. However, 
there is a possibility that Japan cannot take part in the 
discussion, because anti-whaling countries are seeking zero 
capture. 
 
Research whaling started in 1987. It is now being carried out in the 
Southern Ocean and the Northwest Pacific. Japan ha notified the IWC 
of its plan to catch 1,300 whales a year. The government intends to 
submit a reduction plan, while monitoring the moves of anti-whaling 
countries at the interim meeting. The planned cutbacks will likely 
be between dozens and several hundred. 
 
Japan has expanded its whaling research program year by year. This 
will be the first time for it to submit a reduction plan at a formal 
setting. 
 
Fierce confrontation between pro-whaling countries and anti-whaling 
countries is preventing cool-headed discussion at the IWC. It was 
decided last summer that in order to normalize the situation, a 
comprehensive settlement plan should be compiled by the annual 
plenary meeting to be held in June this year. Japan's scientific 
research whaling is a major bone of contention in such a process. 
 
The draft proposal released on February 2 by Chairman Hogarth of the 
U.S. notes that in return for traditional coastal whaling being 
allowed in the sea around Japan, research whaling in the Southern 
Ocean (1) should be abolished in stages over five years or (2) can 
be continued on a reduced basis. Agriculture, Fisheries and Foreign 
Minister Ishiba has indicated a view that it is impossible for Japan 
to accept the first proposal. 
 
ZUMWALT