VZCZCXRO9955
RR RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #2901/01 3520840
ZNR UUUUU ZZH
R 180840Z DEC 09
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC 8317
RUEATRS/TREASURY DEPT WASHDC
RHEHAAA/NSC WASHDC
RUEHOK/AMCONSUL OSAKA KOBE 1822
RUEHFK/AMCONSUL FUKUOKA 8010
RUEHNAG/AMCONSUL NAGOYA 5128
RUEHKSO/AMCONSUL SAPPORO 8511
RUEHNH/AMCONSUL NAHA 0356

UNCLAS SECTION 01 OF 02 TOKYO 002901 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR E, EAP, EEB, EAP/EP AND EAP/J 
NSC FOR JIM LOI AND DOUG BELL 
STATE PASS USTR FOR WENDY CUTLER AND MICHAEL BEEMAN 
TREASURY FOR ROBERT DOHNER AND MICHAEL KAPLAN 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EINV EAGR APEC JA
SUBJECT: APEC SOM TONG'S BILATERAL ECONOMIC MEETINGS WITH MOFA AND 
METI OFFICIALS 
 
REF: Tokyo 02715 
 
¶1.  (SBU) SUMMARY: U.S. APEC Senior Official Kurt Tong met with 
Ministry of Foreign Affairs (MOFA) and Ministry of Economy, Trade 
and Industry (METI) officials to discuss U.S.-Japan bilateral 
economic dialogue ideas, Japan Post, whaling, the future of the 
investment dialogue and beef on December 8.  MOFA and METI officials 
are eager to engage on a bilateral economic dialogue at the senior 
bureaucratic level and agree that initially limiting the focus of 
the dialogue to roughly two issues is a good idea.  MOFA and METI 
officials, however, offered no new solutions for the other issues 
Tong raised.  Tong also reviewed a range of substantive and 
operational APEC issues with his counterparts, stressing the need 
for the two nations to continue our strong cooperation in APEC. END 
SUMMARY. 
 
Bilateral Economic Dialogue 
--------------------------- 
¶2. (SBU) Tong reiterated points Undersecretary for Economic, 
Business, Energy and Agricultural Affairs Robert Hormats made during 
his November meetings with senior MOFA and METI officials (reftel). 
Tong said inter-agency consultations on the appropriate level and 
focus of a new dialogue are on-going, and that no decision has been 
made.  He previewed a possible dialogue format that would discuss 
APEC coordination issues and one or two other agreed-upon topics. 
Small delegations would use a focused agenda to seek progress on 
these one or two issues. 
 
¶3. (SBU) MOFA DG Suzuki and METI VM Ishige both indicated they liked 
the concept.  DG Suzuki indicated Japan would like to discuss China 
issues at the dialogue, but Tong stressed the U.S. is not interested 
in talks that merely exchange notes on external problems.  He 
suggested we could coordinate positions via APEC, talk about our 
respective trade agreements, or tackle specific bilateral issues. 
MOFA and METI were dissatisfied with the response, but agreed there 
are avenues to talk about China without it being a key theme.  Tong 
said the USG intends to discuss the proposal formally soon and hopes 
to invite Japanese officials to a meeting in Washington in early 
¶2010. 
 
Investment 
---------- 
¶4. (SBU) METI Vice Minister Ishige told Tong METI is very interested 
in reviving and continuing the investment working group.  As example 
of its desire to continue this beneficial and successful initiative, 
JETRO is presently organizing an investment seminar in San Jose that 
will focus on innovative companies.  Tong reiterated points U/S 
Hormats made stating that the USG has yet to reach a consensus on 
the future of our bilateral economic dialogue, including the 
investment initiative.  The USG is currently examining the 
initiative with an eye to making it more relevant to jobs/employment 
creation and innovation.  The Investment Initiative must also 
encourage "structural reform," a negative phrase in Japan, but this 
is a subject that needs to be addressed if the dialogue is to 
continue.  Ishige agreed "reform" needs to be a component of the 
dialogue, and explained the Democratic Party of Japan (DPJ) is also 
focused on employment creation.  Thus, a revised investment dialogue 
with a focus on jobs is also in Japan's interest. 
 
Insurance 
--------- 
¶5. (SBU) MOFA DG Suzuki told Tong the current legislative measures 
in the Diet are "nothing to worry about" because they only freeze 
postal privatization.  The new legislation does not restructure 
Japan Post.  The next Diet session, however, could result in 
legislation that restructures Japan Post in a way that is "good or 
bad."  Suzuki suggested the USG talk directly with Ministry of Vice 
Financial Services Minister Kohei Otsuka, a drafter of the new 
language, to ensure it is an improvement on the current law, and to 
make certain universal service is clearly defined and does not 
negatively impact foreign financial services firms.  Tong warned 
Suzuki of the importance of avoiding any steps that damage the 
ability of foreign firms to access Japan's insurance market. 
 
Whaling 
------- 
¶6. (SBU) Tong pressed for Japan to dramatically lower its whaling 
quotas for the coming season.  Suzuki told Tong violent actions from 
groups such as the Sea Shepherd do not help discussions on setting 
 
TOKYO 00002901  002 OF 002 
 
 
new lower Japan whaling targets.  The current target of 
approximately 800 whales was not met in 2008 (only were 600 caught), 
but an agreement to reduce the annual catch to the U.S. goal of 
approximately 300 whales will be very hard, according to Suzuki. 
Whaling is an issue run by a small group of hard core Liberal 
Democratic Party (LDP) politicians who do not see any need to 
compromise on Japan's culture of whaling.  The DPJ, Suzuki thought, 
might change the calculation somewhat, but noted it is still too 
early to know what the coastal and open water numbers for whaling 
might be. 
 
Beef 
---- 
¶7. (SBU) The GOJ is trying to do more on beef, but MOFA, according 
to Suzuki, was dismayed USTR Kirk did not discuss the topic with 
Ministry of Agriculture, Forestry and Fisheries (MAFF) Minister 
Akamatsu in Geneva when they met during the week of November 30. 
This, in Suzuki's opinion, slowed progress.  That said, Suzuki said 
the United States will not like the steps Japan is going to take, 
which is a step-by-step approach.  Tong stressed that such an 
approach will not work, and Japan needs to adopt OIE standards and 
get to full compliance.  Suzuki said Japan's Food Safety Commission 
(FSC) needs more information to do its work, and added the 
information that is currently publicly available is insufficient. 
Tong questioned the FSC's request and stressed that all the 
information the FCS requires is publicly available and has been used 
by the World Animal Health Organization (OIE) to determine that U.S. 
beef is safe. 
 
ROOS