Cablegate: Japanese Morning Press Highlights 06/14/06

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UNCLAS SECTION 01 OF 11 TOKYO 003264

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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 06/14/06

Index:
1) Top headlines

2) Editorials

3) Prime Minister's daily schedule

4) Overseas dispatch of the SDF would have public security as a
main role under LDP's draft permanent PKO bill

5) LDP permanent PKO bill would let SDF be dispatched overseas
without a UN resolution

6) Yokosuka mayor de facto accepts deployment of a nuclear-
powered US carrier to the US Navy base

7) EEZ negotiations between Japan, South Korea end without
results

8) ROK refuses to halt its surveys in disputed waters near
Takeshima

9) Chief Cabinet Secretary Abe: The 3 patrol boats to Indonesia
under ODA program will be exceptions to the no-weapons export
rule

10) Stock market plunges 614 points, worst drop since 9-11
attacks, affected by aftershocks of Murakami fund case

11) Bank of Japan Governor Fukui apologizes for providing
Murakami with 10 million yen start-up money years ago

12) Opposition parties in the Diet calling for BOJ Fukui's
resignation over Murakami fund connection

13) Opposition in Diet pursuing Prime Minister Koizumi's
responsibility for Murakami fund incident

14) All four opposition parties come out against resuming imports
of "unsafe" US beef, ask Koizumi not to give President Bush a
"gift" by reopening market 10

15) Government to decide next week to resume imports of US beef

16) Non-partisan group of lawmakers issue statement calling Prime
Minister's Yasukuni visits unconstitutional

17) Presidential hopeful Yasuo Fukuda remains active on foreign
policy front, but still mum about his candidacy in the LDP
election

18) Fukuda supporters in LDP presidential election alarmed by his
reticence about stating his candidacy

Contents:
1) TOP HEADLINES

Asahi:
Revision of labor regulations: Drop in premium rate for overtime
work; Working time regulations to be abolished for workers
earning over a certain level

TOKYO 00003264 002 OF 011

Mainichi:
Illegal exemption of subscription to government pension plan
reaches 200,000 cases

Yomiuri:
Information on 4 million DION customers leaked; Insider
involvement suspected

Nihon Keizai:
Competition over public works spreads; Contract prices for major
general contractors drop due to revision to Antimonopoly Law

Sankei:
Trust in Bank of Japan Governor Fukui shaken; Keeping investment
private invites suspicion

Tokyo Shimbun:
Tokyo stocks suffer biggest loss since 9/11; BOJ Governor Fukui's
investment adding to problem?

2) EDITORIALS

Asahi:
(1)BOJ Governor Fukui's investment hurts trust in banking system
(2)Foreign A-bomb victims: Government is responsible for helping
them

Mainichi:
(1)North Korea human rights law: Toughen pressure by helping
North Korean defectors
(2)17 trillion yen needed to shift primary balance into the
black; Fiscal reconstruction to be issue in Upper House election
next year

Yomiuri:
(1)Stock price fall: Cautiously monitor risks
(2)Japan-South Korea EEZ talks should be pursued separately from
Takeshima/Dokdo ownership issue

Nihon Keizai:
(1)It is not possible to reconstruct finances with hesitant
spending cuts
(2)BOJ governor should disclose his personal assets

Sankei:
(1)Japan-South Korea EEZs: South Korea's claim bewildering
(2)BOJ Governor Fukui cannot escape for being criticized for
carelessness

Tokyo Shimbun:
(1)EEZs of Japan and South Korea: Another demarcation needed for
practical advantage for both countries
(2)Avoiding return of internal conflict in East Timor

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, June 13

NIHON KEIZAI (Page 2) (Full)
June 14, 2006

09:02

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Attended cabinet meeting in the Diet building.
09:25
Arrived at Kantei.
11:01
Responded to interview for the cabinet's email magazine.
16:03
Met Upper House member Seiko Hashimoto.
17:33
Attended monthly-economic-report-connected cabinet ministers'
meeting.
18:52
Had haircut at the barber in Capital Tokyu Hotel.
19:46
Returned to his official residence.

4) LDP bill eyes overseas security missions for SDF

MAINICHI (Page 1) (Abridged)
June 14, 2006

The ruling Liberal Democratic Party has worked out its draft of a
bill to create a permanent law stipulating requirements for Japan
to dispatch Self-Defense Forces personnel overseas for their
engagement in international peace cooperation activities. The LDP-
drafted bill, revealed yesterday, allows SDF personnel to operate
only in areas where there is no armed conflict. In addition, the
bill eases Japan's current legal guidelines for SDF personnel's
use of weapons-or the rules of engagement (ROE)-and authorizes
them to engage in public security and escort missions. The bill
does not require a United Nations resolution for Japan's overseas
dispatch of SDF personnel, and it allows the government to send
SDF troops overseas at its own judgment. However, the bill
requires the government to ask for Diet approval. The bill is
expected to be reported to an LDP defense policy subcommittee in
its meeting today. The government and ruling parties will now
restart their stagnated discussions on the permanent legislation.

SDF members on overseas assignments are currently authorized to
use weapons in self-defense or emergency evacuation only. The LDP-
drafted bill, however, allows SDF personnel to use weapons on
their overseas missions in compliance with the internationally
recognized rules of engagement (ROE). In addition, the LDP bill
also allows the SDF to engage its personnel in public security
operations, escort services, and armed rescue activities.

5) LDP legislation allows SDF dispatches without UN resolution

ASAHI (Page 4) (Full)
June 14, 2006

The ruling Liberal Democratic Party has revealed its draft of a
bill to establish a permanent law, instead of an ad hoc special
measures law, for Japan to send Self-Defense Forces personnel
overseas. The LDP-drafted bill allows Japan to participate in
multinational forces without a United Nations resolution or an
international organization's request. The bill will be presented
in today's meeting of an LDP defense policy subcommittee chaired
by former Defense Agency Director General Shigeru Ishiba.

Japan's overseas dispatch of SDF troops is currently allowed
under the Law for Cooperation on United Nations Peacekeeping
Operations, the so-called PKO Cooperation Law. In addition, there

TOKYO 00003264 004 OF 011

is a time-limited law for special measures against terrorism and
another temporary special measures law for Japan's assistance
with Iraq's reconstruction. All these laws require a UN
resolution or an international organization's request for Japan
to dispatch SDF troops.

The LDP-drafted bill, however, allows Japan to dispatch SDF
troops overseas if there is a request based on an agreement
between the parties to a dispute or even in the case of "a
situation where Japan's contribution to the international
society's efforts is recognized to be necessary in particular."

In addition, the LDP bill allows SDF personnel to engage in
public security operations and VIP escort services overseas. The
bill also gives expanded authority to SDF personnel to use
weapons to protect facilities and supplies.

The LDP bill further requires the government to obtain
parliamentary approval before sending SDF troops overseas.
However, Japan under its postwar Constitution is prohibited from
using armed force overseas. In the event Japan is allowed to
dispatch troops overseas under a permanent law, its
constitutionality would be called into question. The LDP is
expected to face some difficulties in its discussions.

6) Yokosuka mayor to approve nuclear carrier deployment

YOMIURI (Page 2) (Full)
June 14, 2006

The city of Yokosuka, Kanagawa Prefecture, will hold a plenary
meeting of its municipal assembly today to discuss the US Navy's
planned deployment of a nuclear-powered aircraft carrier to its
Yokosuka base. In the session, the city's mayor, Ryoichi Kabaya,
will clarify his approval to dredge the port of Yokosuka for a US
nuclear-powered aircraft carrier. This means the mayor's de facto
acceptance of a nuclear-powered warship's deployment to Yokosuka.
The mayor will shortly respond to consultations with the
government on the dredging work.

The Japanese and US governments have agreed to replace the USS
Kitty Hawk, a Yokosuka-based conventional aircraft carrier, with
the USS George Washington, a nuclear-powered flattop.

However, Yokosuka port is not deep enough at its present aircraft
carrier berth to moor the George Washington. It is therefore
necessary to dig down about two meters there. The mayor is in
charge of Yokosuka port, so the Defense Facilities Administration
Agency needs the mayor's permission to start the work. On June
12, Foreign Minister Aso called at the city's municipal
government office and asked for the mayor's cooperation.

7) Japan, ROK fail to fill gap in EEZ talks; Next round of talks
set to occur in Seoul in September

YOMIURI (Page 2) (Excerpts)
June 14, 2006

The Japanese and South Korean governments yesterday wound up two
days of talks held in Japan's Ministry of Foreign Affairs (MOFA)
on demarcation of the boundaries of their respective exclusive
economic zones (EEZ). In the talks, both sides went no further

TOKYO 00003264 005 OF 011

than to exchange their stock principles, both asserting that
Takeshima/Dokdo should be used as the base point of their
respective EEZ. They agreed to continue the talks and meet again
in Seoul in September.

In the talks, MOFA International Legal Affairs Bureau Director-
General Ichiro Komatsu insisted: "Our assertion is the same as
before, namely, that an equidistant line should be drawn between
Takeshima and Ullungdo with Takeshima as the base point."

On the other hand, South Korea's chief negotiator, Park Hee Kwon,
director-general of the Treaties Bureau of the South Korean
Foreign Ministry counterargued: "We have to assert that our base
point should be Dokdo."

At the outset of the negotiations, both sides clashed with each
other over the question of what the base point of their
respective EEZ would be. Park criticized Japan for its plan to
conduct a maritime survey in waters around Takeshima in April,
stressing that this sort of behavior has led to his country's
assertion that Dokdo should be used as the base point of his
country's EEZ.

The South Korean delegation apparently gave the highest priority
to "clearly conveying to Japan that South Korea has sovereignty
over Dokdo," according to a source familiar with Japan-ROK
negotiations. Behind South Korea's this approach lies the South
Korean people's growing desire for a hard-line policy toward
Japan, since the South Korean public took Japan's plan to conduct
a marine survey in April as an unjustified violation of their
country's sovereignty.

In the talks, South Korea insisted that the borderline should be
drawn between Takeshima and Okinoshima islets, although it
previously had used Ullungdo as the base point.

Problem of rock

South Korea previously had asserted that Ullungdo should be used
as the base point, viewing Takeshima as protruding rocks. Rocks
cannot serve as the base point of EEZ under international law. If
South Korea asserted Takeshima as the base point, there is the
possibility that South Korea will find it difficult to reject
Japan's assertion of using Torishima Island as the base point of
its EEZ, because South Korea has previously asserted that
Torishima is a rock. A MOFA official explains: "South Korea would
lose a much more part of its EEZ and more undersea natural
resources by recognizing Torishima as Japan's base point than
what South Korea will gain by using Takeshima as its base point."

South Korea seems to have put emphasis on sovereignty over
profits in the talks this time, some observers say.

Meanwhile, Japan attached importance to continuing talks and
avoiding a conflict. A senior MOFA official said: "We needed to
secure an occasion for both sides to discuss the EEZ issue in a
cool-headed manner while avoiding a recurrence of a dispute
between the two countries like the one in April over a plan for a
marine survey in waters around Takeshima."

In the talks, both Japan and South Korea agreed to resume the
next round in September. Japan somehow achieved one of the goals.

TOKYO 00003264 006 OF 011

From a long-term perspective, Japan is looking into the
possibility of EEZ demarcation, and another aim of Japan is that
"As long as negotiations continue, the waters around Takeshima
are considered to be a disputed area between Japan and South
Korea. This would prevent South Korea from creating a fait
accompli by illegally occupying Takeshima," a Japanese government
official says.

8) ROK refuses to cancel planned ocean survey in EEZ talks, but
both Japan, ROK agree to hold next round in September

SANKEI (Page 5) (Excerpts)
June 14, 2006

The 5th Japan-South Korea talks intended to demarcate their
exclusive economic zones (EEZ) ended yesterday without narrowing
the gaps of views over, for instance, the base points of their
respective EEZs in waters around the Takeshima/Dokdo islets. In
the talks, Japan asked South Korea to cancel its planned
oceanographic survey in July, but South Korea refused to accept
Japan's request. The two countries, however, agreed to continue
the talks and hold the next round in Seoul in September, but the
possibility cannot be ruled out that a similar dispute as seen in
April, when Japan planned to conduct an ocean survey in April,
will flare up again in coming months.

According to a source involved in the talks, Japan insisted as in
the past that the equidistant line should be determined by using
Takeshima/Dokdo as Japan's base point and Ullungdo as South
Korea's base point. But South Korea, switching from its previous
position that its base point should start from Ullungdo,
requested that its base point should be Takeshima/Dokdo and that
Japan's should be Okinoshima. South Korea said this policy switch
came in response to Japan's recent marine survey plan, saying
that the fault lies with Japan.

Referring to South Korea's planned ocean survey, Japan called on
South Korea to exercise self-restraint, noting, "It's important
for both sides to exercise self-restraint." Japan proposed
establishing a prior notice system for both sides to inform the
other if they plan to conduct a marine survey in waters
surrounding Takeshima, but South Korea dismissed these two
requests by Japan, saying, "They are not the subjects for EEZ
negotiations."

9) Chief cabinet secretary's statement: Providing Indonesia with
patrol boats with ODA funds is exception to three principles
banning arms exports

SANKEI (Page 5) (Full)
June 14, 2006

The government decided yesterday in a cabinet meeting to provide
Indonesia with grant aid for the purchase of three patrol boats.
A bulletproof patrol boat corresponds to a "weapon," the export
of which is forbidden under Japan's three principles on arms
exports. The government has, however, made it an exception,
citing the vessels would be used to track down terrorists and
pirates. It will be the first time for Japan to use its official
development assistance (ODA) to offer "weapons" to another
country.

TOKYO 00003264 007 OF 011

Chief Cabinet Secretary Shinzo Abe released a statement
explaining yesterday's cabinet decision. The statement wrote: 1)
The patrol boats will be used only for cracking down on
terrorists and pirates; and 2) they will not be sold to a third
party without prior approval of the Japanese government. Abe
explained in the statement that the basic philosophy of the three
basic principles banning arms exports would be secured.

The total cost of the three patrol boats will be 1.921 billion
yen. They will be deployed to Indonesia' National Police
Headquarters' Maritime Police Bureau and other posts. They will
be used to crack down on pirates and terrorists, as well as
prevent proliferation of weapons of mass destruction.

10) Tokyo stocks fall by 614 yen; Biggest drop since 9-11
terrorist attacks on US

ASAHI (Page 1) (Full)
June 14, 2006

Following the worldwide fall in stock prices, Tokyo stocks
continued to fall yesterday with the Nikkei index and TOPIX,
which shows the movements of all stocks listed on the First
Section of the Tokyo Stock Exchange, posting an all-time low. The
Nikkei Stock Average recorded the biggest point loss, finishing
the day with the biggest point loss of 600 since the 9-11
terrorist attacks in the US. The revelation of Bank of Japan
Governor Fukui's investment of 10 million yen in Murakami Fund
put a further dent in the market.

The TSE closed with the Nikkei Stock Average dropping to 14,218,
down 614.41 points from the day before and TOPIX to 1458.30, down
by 52.59 points from the day earlier. The trading volume stood at
1.96 billion stocks.

11) BOJ Governor Fukui apologizes over investment issue;
Government determined not to pursue matter

ASAHI (Page 1) (Full)
June 14, 2006

During a government meeting held yesterday evening that included
Prime Minister Koizumi, Bank of Japan (BOJ) Governor Toshihiko
Fukui apologized for investing 10 million yen in the Murakami
Fund represented by Yoshiaki Murakami. He noted, "I am sorry for
all the fuss." The government and the ruling parties do not
intend to call Fukui to account for his involvement, taking the
position that since his action is not in violation of BOJ
regulations, there is no problem with his investment. However,
the ruling parties plan to pursue the responsibility of Fukui and
the prime minister for his appointing him. There is the
possibility of calls for seeking Fukui's resignation mounting.

Commenting on reasons why he invested in the Murakami Fund, Fukui
during a monthly meeting of cabinet ministers involved with a
monthly economic report held at the Prime Minister's Residential
Office (Kantei) yesterday evening explained, "I invested in
Murakami Fund along with my colleagues in order to encourage that
brave young man."

Fukui later told reporters that he had no comment to make on his
moral responsibility and whether he would remain in office or

TOKYO 00003264 008 OF 011

resign. According to him, he asked the Murakami Fund to cancel
his investment contract this February. The cancellation will
likely be made in late June. It is said that he has paid taxes
worth more than 100,000 yen a year at the most for investment
profits. However, the actual amount of investment profits has not
been revealed.

Media organizations have called on the BOJ to hold a press
conference by Fukui, but the BOJ turned down the request. The BOJ
Public Relations Office issued a comment on Fukui's investment
activities, which read: "Governor Fukui's investment action is
not in violation of the BOJ internal regulations. It is our
understanding that the governor has properly reported income
gained through the investment."

Prime Minister Koizumi told reporters at the Kantei: "There is no
problem with his action." He then indicated his perception that
there is no need for him to step down.

12) BOJ Gov. Fukui under fire

SANKEI (Page 2) (Excerpts)
June 14, 2006

In the wake of Bank of Japan Governor Toshihiko Fukui's
revelation that he invested 10 million yen in the Murakami Fund,
market players and others have begun pointing out the moral
responsibility of the nation's top financial policy officer.
Fukui might be asked for a detailed explanation on his decision
to invest in the fund and profit from it.

Toin University of Yokohama economic criminal law Professor Nobuo
Gohara, a former Tokyo District Public Prosecutors Office
prosecutor, took this view:

"What was his view of the fund in investing it? If he had a
consistent policy, there was no need for him to get upset with
the arrest of (fund manager Yoshiaki Murakami). His excuse tells
of his poor perception of the fund. It was a problem that he
continued providing money to the fund."

A mid-level bank executive also criticized Fukui:

"Investing in the fund before assuming the BOJ post is
understandable to some extent, but he should have withdrawn all
the money once he took on the job. As the chief financial
officer, it is unthinkable that he didn't know the Murakami
Fund's modus operandi until it resorted to arbitrage. He is
simply too insensitive."

Opposition camp to demand Fukui's resignation

Fukui's revelation that he invested 10 million yen in the
Murakami Fund has sent shockwaves through the political
community, with the ongoing Diet session scheduled to end in just
a few days. The opposition camp intends to demand Fukui's
resignation and pursue Prime Minister Koizumi's responsibility
for appointing him.

Minshuto (Democratic Party of Japan) President Ichiro indicated
in a press conference that his party would take up the issue in
the Diet, saying, "The matter is serious in that it involves the

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Bank of Japan governor, who is the nation's top financial
officer." Diet Affairs Committee Chairman Kozo Watanabe also
criticized Fukui, noting, "His resignation is inevitable. The
government and Prime Minister Koizumi also need to take
responsibility."

13) Opposition camp to pursue Koizumi's responsibility for
appointing Fukui as BOJ governor in wake of revelation of his
investment in Murakami Fund

YOMIURI (Page 4) (Excerpts)
June 14, 2006

Bank of Japan Governor Toshihiko Fukui once invested 10 million
yen in the fund run by Yoshiaki Murakami, who has been arrested
over alleged insider trading in violation of the Securities and
Exchange Law. In this connection, the opposition bloc decided
yesterday to pursue Prime Minister Koizumi's responsibility for
appointing Fukui to the post and Fukui's moral responsibility.

Minshuto (Democratic Party of Japan) President Ichiro Ozawa told
a press conference yesterday: "It is a serious problem that the
Bank of Japan president has invested in a fund that is directly
under the central bank regulation." Secretary General Yukio
Hatoyama also indicated that his party would file a no-confidence
motion against the Koizumi cabinet, saying: "It was a mistake in
a series of personnel appointments by the prime minister. It
speaks of the actual situation of the Koizumi reform drive."

The opposition camp intends to grill Koizumi and Fukui at the
Upper House Budget Committee session tomorrow and the Lower House
Fiscal and Financial Committee meeting on June 15. The opposition
block also plans to urge the ruling camp to summon Fukui as an
unsworn witness in an out-of-session meeting even after the
ongoing Diet session ends on June 18.

In contrast, many in the government and the ruling coalition are
defending Fukui.

14) Four opposition parties unite in opposition to resumption of
US beef imports: We oppose giving such "gifts" to the US

ASAHI (Page 4) (Full)
June 14, 2006

The four opposition parties -- Minshuto (Democratic Party of
Japan), Japanese Communist Party (JCP), Social Democratic Party
(SDP), and the People's New Party -- yesterday held a meeting
near the Diet called the "National Rally to Stop the Hasty
Resumption of US Beef Imports." The heads of each party and
approximately 600 persons showed up from consumer organizations
and other groups to criticize Prime Minister Koizumi for timing
the resumption of imports with his trip to the US so he can bring
this as a "gift" (to President Bush).

Minshuto President Ichiro Ozawa pointed out, "The US will only
have contempt for Japan if we go so far in such obvious
obsequiousness." JCP head Shii said: "He has placed loyalty to
the US over the lives of the Japanese people." The SDP
representative said: "He wants to bring gifts for the Okinawa (US
military) bases."

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15) Government to decide on resumption of US beef imports
possibly next week

NIHON KEIZAI (Page 5) (Full)
June 14, 2006

The Japanese and US governments are expected, possibly next week,
to hold the final phase of talks to determine specific procedures
for the resumption of US beef imports and then make a decision on
a resumption. Town meetings with consumers were planned for 10
locations across the country, and they will end with the one in
Tokyo set for today. Through such meetings, the government has
thought that a certain degree of public understanding toward a
set of preventive measures against recurrences, including prior
inspections of US facilities, on which both Japan and the United
States have reached a basic agreement, has been obtained now. US
beef is likely to arrive in Japan in late July if things go
smoothly.

During the Japan-US meeting in May, Japan gave approval to the US
report on reinspections of its facilities handling beef for
Japan, noting there will be no safety problem. Both sides then
agreed in principle that Japan would directly confirm America's
safety control system by, for instance, conducting prior
inspections or snap inspections after the resumption of beef
imports. The final phase of bilateral talks is set to occur after
all town meetings are over.

Through the town meetings, the government has now a good grip on
consumers' opinions, as a senior Agricultural Ministry official
pointed out, "We've exhausted all ideas regarding the steps that
can be taken." The government now thinks that it has come to the
stage of stepping up inspections of US plants and the quarantine
system at home.

16) LDP group complies set of proposals stipulating prime
minister's visits to Yasukuni Shrine are unconstitutional

NIHON KEIZAI (Page 2) (Full)
June 14, 2006

A nonpartisan parliamentary group thinking of creating a national
war memorial, chaired by Taku Yamasaki, yesterday came up with a
set of proposals calling on the government to build a secular
memorial. The group points out that with Prime Minister Junichiro
Koizumi's visits to Yasukuni Shrine in mind, there are concerns
that the visits are unconstitutional. The recommendation also
stipulates that the fact that Class-A war criminals are enshrined
along with the other war dead has angered neighboring countries.

17) Fukuda supporters nudging him to make his decision to run in
LDP presidential race

YOMIURI (Page 4) (Excerpts)
June 14, 2006

Lawmakers close to former Chief Cabinet Secretary Yasuo Fukuda of
the Mori faction in the Liberal Democratic Party are perplexed by
his elusive attitude about entering the LDP presidential race in
September. Although Fukuda has suggested his eagerness to run in
the election through his diplomatic activities, moves of his
supporters have been far more inactive than those backing Chief

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Cabinet Secretary Shinzo Abe, who has declared his readiness to
seek the LDP presidency. The fence sitters have begun urging
Fukuda to make up his mind soon.

Winding up a meeting of the Asian Forum of Parliamentarians on
Population and Development, Fukuda returned home from New Zealand
yesterday afternoon. He is chair of the forum. As chairman of the
Japan-Indonesia Association, Fukuda is also scheduled to visit
that country later this month to hold talks with key Indonesian
government members.

With Asia diplomacy expected to become a campaign issue, many
observers regard Fukuda's activities in that area as his
expression of eagerness for the LDP presidency. Although Fukuda
has come out second after Abe in various opinion polls, the
number of lawmakers supporting him has not increased probably
because of his elusive attitude. The situation contrasts sharply
with Abe, whose supporters have begun dashing ahead toward the
presidential goal.

18) LDP presidential race: Anti-Koizumi, non-Abe support groups
impatient with Fukuda's silence

NIHON KEIZAI (Page 2) (Excerpts)
June 14, 2006

There is growing concern in the ruling camp that Yasuo Fukuda has
still not said whether he will run in the September Liberal
Democratic Party (LDP) presidential election. Forces opposing
Prime Minister Junichiro Koizumi aim to tighten the noose around
Chief Cabinet Secretary Shinzo Abe, who it is believed would
continue the Koizumi policy line. They are concerned that they
have yet to choose their own candidate. Some LDP lawmakers are
now taking action with an eye on Fukuda not running in the race.

Koichi Kato, who has been critical of Koizumi's Asia diplomacy,
said on a TV program recorded yesterday: "It's better to announce
early whether he will run or not. I think he will probably do so
before the end of this month." He was urging Fukuda to make up
his mind. Taku Yamasaki, a longtime ally of Kato, also has made
similar remarks.

"Mr. Fukuda has said nothing," Yoshiro Mori, chairman of the
largest faction in the LDP, to which both Abe and Fukuda belong,
told Shozo Kusakawa, a vice representative of the New Komeito,
yesterday at a Tokyo hotel. Mori was complaining that he was
unable to divine Fukuda's real intention.

The New Komeito, the LDP's junior coalition partner, also is
interested in the LDP leadership race. Since the party has
opposed to Koizumi's visits to Yasukuni Shrine, it feels an
affinity with Fukuda. It also has hopes for Abe's high popularity
when considering next year's House of Councillors election.

Many Mori faction members are worried that if both Abe and Fukuda
run in the race, the faction will split. Senior members will soon
hold a meeting to discuss the matter.

SCHIEFFER

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