Cablegate: Daily Summary of Japanese Press 11/08/06

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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: DAILY SUMMARY OF JAPANESE PRESS 11/08/06

INDEX:

(1) Japan, Australia to enter EPA talks with focus on beef, flour,
etc.

(2) FTA proposed for all APEC member nations: US concerned about
integration of East Asia; China, ASEAN likely to oppose US
involvement

(3) Bases and options -- 2006 Okinawa gubernatorial race (Part 2):
Government steadily developing plans behind the scenes

(4) Propriety of nuclear debate: Argument that Japan should go
nuclear is unrealistic: Yukio Okamoto, international affairs
consultant

(5) Interview with former defense chief Fukushiro Nukaga on the
North Korean nuclear issue: Collaboration among five members of
six-party talks necessary

(6) Questions and answers about the debate on reform of the
education board system: Abe administration intends to deepen the
government's involvement

ARTICLES:

(1) Japan, Australia to enter EPA talks with focus on beef, flour,
etc.

YOMIURI (Page 11) (Full)
November 8, 2006

The governments of Japan and Australia yesterday held working-level
talks in Canberra with a view to starting talks on the signing of an
economic partnership agreement (FPA) featuring a free trade
agreement (FTA). Participants of the meeting agreed to aim at
embarking on talks in the new year. They hope to see a formal
agreement reached at the summit between Prime Minister Abe and
Australian Prime Minister Howard to be held on the sidelines of the
East Asia summit to be held in the Philippines in December.

The case in point before entering EPA talks with Australia is how to
treat Japan's key trade items, such as beef, dairy products and
flour. No agreement was reached on this issue at yesterday's
meeting. The scrapping of tariffs on those items is bound to have a
serious impact on domestic agriculture. Agriculture Minister
Matsuoka noted, "We should not start talks with Australia before
working out how to handle key items." Tokyo and Canberra will speed
up final-stage efforts to sort out the issue.

(2) FTA proposed for all APEC member nations: US concerned about
integration of East Asia; China, ASEAN likely to oppose US
involvement

YOMIURI (Page 11) (Full)
November 8, 2006

It has been learned that a draft declaration to be released at the
summit to be held on the sidelines of the Asia-Pacific Economic
Cooperation (APEC) forum meeting would include a call for looking
into the feasibility of a free trade area for the Asia and Pacific
(FTAAP) initiative in response to a strong request from the US. The
US is increasingly alarmed about moves to integrate Asian economies,

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an initiative being promoted by the Association of Southeast Asian
Nations (ASEAN). It aims at deepening its involvement in Asia
through APEC. Since China and ASEAN are expected to oppose this move
by the US, coordination of views to approve the statement will
likely be complicated.

US aim

The concept of an FTA involving all APEC members has thus far been
proposed only at the private sector level. If APEC leaders share the
same view as the private sector on having an APEC FTA as mentioned
in the draft declaration, the feasibility of adopting such an
initiative will move a step forward. The US intends to give momentum
to its FTAAP proposal over the next year through joint research with
APEC member nations on challenges and advantages in materializing
the initiative.

What motivated the US to attach importance to APEC in its trade
strategy toward East Asia is Washington's concern that with China
increasing its economic presence in Asia through a proposed FTA with
ASEAN, an economic bloc might be formed in East Asia without US
participation.

Regarding the economic integration of Asia, a direction for trade
liberalization policy and how efforts to realize such should be made
were adopted at ASEAN summits and ASEAN plus Three -- Japan, China
and South Korea - meetings held on the sidelines of the ASEAN
summits. Both meetings take place in November or December every
year.

A number of initiatives proposed

Japan has also proposed an East Asia Economic Partnership Agreement
(EPA) and an East Asia-version of the Organization for Economic
Cooperation and Development (OECD). Talks for realizing those
initiatives have also kicked off. Sixteen countries - ASEAN Plus
Three Plus Three (India, Australia and New Zealand) -- are taking
part in the talks.

APEC and East Asian nations include newly emerging markets with high
economic potential, such as Russia, India and China. The European
Union (EU) is also increasingly strengthening its efforts to sign
FTA's with Asian countries, such as ASEAN.

Using APEC is apparently the most realistic means for the US to get
involved in the process of the economic integration of Asia. Japan
sees that the US is motivated by the desire to wrench-open the Asian
market, using APEC, as a government source put it. This source also
noted, "APEC members will probably agree by and large with the US
idea of launching a joint study of an FTA at the Hanoi summit."

Binding power

China, which is increasing its economic impact on ASEAN, is strongly
opposing US involvement, however.

China already proposed the East Asia Free Trade Area Initiative
targeting ASEAN, Japan, China and South Korea in 2004. Opposing the
US move, it insists, "Liberalization among ASEAN Plus Three should
be promoted before an FTA for all APEC members."

The degree of liberalization and developments of the economies of 21
APEC members largely differs. Even factoring out the US motive of

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trade strategy, APEC members are expected to encounter considerable
difficulties in actually pressing ahead with economic integration.

As a feature, APEC is a mild consultative framework that does not
bind its members to accept liberalization of trade and investment.
However, the US has proposed at high working-level meetings held in
preparation for the Hanoi APEC meeting, letting some liberalization
measures promoted by APEC members be equipped with binding power.

There is concern that if the US continues to strengthen its move to
reinforce the functions of APEC, the sense of wariness about the US
move would heighten mainly among developing countries, escalating
discord within APEC.

(3) Bases and options -- 2006 Okinawa gubernatorial race (Part 2):
Government steadily developing plans behind the scenes

ASAHI (Page 3) (Abridged slightly)
November 8, 2006

The ruling camp's "face of the election" was not Abe but Obuchi.

Representing the ruling coalition, Yuko Obuchi (daughter of the late
prime minister who know holds his Diet seat) attended Hirokazu
Nakaima's pep rally on Nov. 3, the day after Okinawa gubernatorial
election campaign officially kicked off.

Obuchi said on the podium:

"Gov. Keiichi Inamine's father, the late Ichiro Inamine, who served
as an Upper House member, took good care of my father. My father
decided to host the Okinawa Summit in return for his kindness. We
must not stop the cooperative trend created by Gov. Inamine and the
central government."

Yuko Obuchi's father, former Prime Minister Keizo Obuchi, picked
Okinawa as the venue for the 2000 G-8 Summit, but he passed away
three months before the landmark event. "In Okinawa, Obuchi carries
greater weight than Abe and Koizumi," a senior Liberal Democratic
Party lawmaker noted.

Okinawa was returned to Japan during the Sato administration and an
agreement was reached between the Hashimoto administration and the
United States to return Marine Corps Air Station (MCAS) Futenma to
Japan. The Obuchi administration also endeavored to strengthen ties
to Okinawa. But the clock seems to have stopped since then.

The Okinawa Summit was hosted by Obuchi's successor, Yoshiro Mori,
whose administration was short-lived. In May, the Koizumi
administration reached a final agreement with the United States on
force realignment. But the administration made little effort to
coordinate views with affected municipalities. Even asked by Okinawa
lawmakers for changes to the government plan, Koizumi always said
curtly, "I have no intention of altering it."

The Okinawa issue is not high on the Abe administration's list of
priorities. There was a sign of this.

A consultative body composed of Tokyo, Okinawa, and affected
municipalities held its inaugural meeting on Aug. 29, a month before
the LDP presidential election. The meeting was void of a seat for
Abe, who was certain to become Koizumi's successor.

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It was just after the LDP and the New Komeito decided to field
Nakaima as Inamine's successor. "No matter who becomes the new
governor, I think Mr. Abe thought that touching on the Okinawa issue
was dangerous," a senior Defense Agency official explained.

The Abe administration has a strong tendency to regard
Okinawa-related issues as a risk.

Minister for Okinawa Affairs Sanae Takaichi's comment in late
October that the government would link the base relocation issue to
its package of economic incentives drew fire from affected
municipalities.

The sensation created by Takaichi's comment has heightened Kantei's
(Prime Minister's Official Residence) sense of alarm toward Okinawa
affairs, according to a Cabinet Office official responsible for
economic measures.

Plans are being made behind the scenes with an eye on the days after
the gubernatorial election.

The Defense Agency will come up with a fiscal 2007 budget that will
include a new subsidy system linked to progress in the planned base
relocation. The agency also aims to submit to next year's regular
Diet session a 10-year legislation enabling the country to offer
economic stimulus measures and bear the Guam relocation cost.

Even if Nakaima loses to Keiko Itokazu, the candidate backed by the
opposition bloc, the government and the ruling coalition will
consider a special measures law to shift the power to authorize the
use of the surface of public waters from prefectural governors to
the central government.

The government has reportedly told President George W. Bush through
US Ambassador to Thomas Schieffer that Itokazu's victory could
hinder the envisaged force realignment.

"The view that the Bush administration will be troubled in such a
case is not correct. It will be the Okinawa public that will be
troubled by it," a former US official said. The White House's basic
stance is, "If Japan does not want it, we won't push it."

At the same time, there are strong expectations in the US government
that even if the new governor opposes the plan, Prime Minister Abe
will implement the bilateral agreement by taking appropriate
measures, such as a special measures law. The Defense Agency has
reportedly conveyed such a scenario to the US government.

The US Defense Department is working out a master plan for building
military facilities in Guam on the assumption that Okinawa Marines
and their families will move there. The department also established
a joint Guam program office in late August.

The Guam project is closely associated with the Futenma relocation.
A lack of progress in Japan for over two years would markedly delay
the Guam relocation, according to the office. "It's not good to
build facilities first and leave them unused for years," the office
said. A delay in Japan would force the US Marine Corps to miss the
2014 Guam relocation deadline.

Tokyo and Washington officials are watching the gubernatorial race
from afar. But they cannot stay on the landing forever. Sooner or
later their determination to implement the US force realignment

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final agreement, including the Futenma relocation project, will be
tested.

(4) Propriety of nuclear debate: Argument that Japan should go
nuclear is unrealistic: Yukio Okamoto, international affairs
consultant

SANKEI (Page 1) (Full)
November 8, 2006

I think the argument that Japan should arm itself with nuclear
weapons is not realistic. This conclusion should come out in
short-time discussion even if we do not mention that Japan is the
sole victim in the world of atomic bombs.

First, Japan, unlike India and Pakistan, is a member nation of the
Nuclear Nonproliferation Treaty (NPT). It also ratified the
International Atomic Energy Agency's (IAEA) additional protocol
designed to require countries to accept rigorous inspections.

Second, although Iran is an NPT member but allegedly has developed
nuclear weapons secretly, it is impossible for Japan to construct an
underground factory.

If Japan decides to develop nuclear weapons, it first would have to
withdraw from the NPT. In such a case, Japan, like North Korea,
would be driven into isolation and be placed under sanctions while
meeting stern condemnation from the international community. Unlike
"Generallissimo" Kim Jong Il in our neighbor, the Japanese people of
today are so mentally fragile that they cannot endure such
pressure.

Third, should Japan withdraw from the NPT, the nation would have to
suspend its nuclear fuel cycle, and atomic power generation would
eventually stop. Some persons courageously say that Japan should
have nuclear weapons, but I doubt that there is realistic evidence
for this argument.

I wonder if such advocates know how difficult it is for a nation to
possess and keep nuclear weapons. I once visited a nuclear missile
base in Wyoming. Within the base complex, 150 Minuteman III missiles
are deployed. They are spread in a wide area, equivalent to Shikoku
Island's total area, with the aim of preventing the missile base
from being completely destroyed by foreign military attacks. To
possess nuclear weapons, huge land and money are necessary. In
Japan, financial authorities have gradually decreased the number of
even F-2 fighters for this or that reason, although the fighter is
the nation's treasure. Under such a tight budget, what can Japan
do?

Given this, there is no need to worry about discussing the
possibility of a nuclear option for Japan and reaching a natural
conclusion. The propriety of Japan's introduction of US nuclear
weapons also should be discussed. In the early 1980s, the Soviet
Union deployed intermediate-range SS20 missiles taking aim at
Europe. Faced with a national crisis, West German Chancellor Kohl
deployed in West Germany the US Pershing II and GLCM (Ground
Launched Cruise Missile) missiles over objections within the nation.
He made a bold decision on the issue that divided the public. The
result was that the Soviet Union made concessions and scrapped all
its SS20 missiles in exchange for having the Pershing II and GLCM
missiles removed from Germany. Kohl saved Germany, and he worked for
the sake of national defense.

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Assuming if Kohl were the prime minister of Japan, what would he do?
He might decide to introduce US nuclear weapons. North Korea, an
abnormal state, might ignore it, but China would turn pale when
learning about the deployment of US nuclear weapons its neighboring
country. China would do its best to persuade North Korea to scrap
its nuclear programs with the aim of letting Japan remove the US
nuclear weapons.

An introduction of US nuclear weapons will politically cost too
much, so it is not a proper option for Japan. The sole way Japan
should choose for its national security is to keep the credibility
of the current Japan-US security arrangements by further deepening
the bilateral relationship.

Under the current severe global circumstances, however, a nuclear
option should be naturally discussed in other independent states.
Being told not to discuss even such theme is tantamount to being
told to be an ostrich putting its head in the sand.

Japan is now faced with only threats from North Korea. China
declared in 1998 that it would stop pointing its nuclear missiles at
the US, but that nation has yet to make a similar declaration toward
Japan. This means that there is a possibility of China launching
missiles at Japan.

What is worse, Chinese atomic submarines carrying nuclear missiles
are navigating in waters near Japan. It seems to be a taboo in terms
of relations with China to deem that nation a military threat.

Being told not to say this or that, we stop making statements. By
only doing so, will Japan's national security be ensured? The
question of whether Japan should arm itself with nuclear weapons is
the most important theme for the nation. A discussion that is
necessary for Japan's safety must be thoroughly discussed without
being sealed off, even though temporary friction occurs inside and
outside the nation. Doing so is our responsibility for the benefits
of future generations.

(5) Interview with former defense chief Fukushiro Nukaga on the
North Korean nuclear issue: Collaboration among five members of
six-party talks necessary

TOKYO SHIMBUN (Page 2) (Full)
November 8, 2006

Questioner: What has been the overall impact of North Korea's
nuclear test?

Nukaga: Any increase in the number of nuclear powers will have an
impact on global peace and stability. North Korea's defiance in
carrying out nuclear testing, even though the international
community had been urging it not to do so, is a provocative act in
violation of the Nuclear Nonproliferation Treaty. It must be
resolutely denounced for it. The sanctions resolution against the
North that the United Nations Security Council adopted unanimously
is the trend in the international community.

Questioner: Japan and other countries have not recognized North
Korea as a nuclear power.

Nukaga: We must not accept North Korea's possession of nuclear
weapons as an accomplished fact. I understand that the range of

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their missiles has been extended since the launch of the Taepodong-1
in 1998 and ballistic missile launches in July. The North's missile
technology has steadily improved. If such is taken into account, we
must conclude that North Korea poses a threat to Japan. There is
also concern that North Korea's nuclear weapons and missiles may
fall into the hands of other countries and terrorist organizations.

Questioner: The expectation is that the six-party talks will be
resumed.

Nukaga: We must avoid the situation of seeing the six-party talks
turn into disarmament talks and that North Korea returns to the
talks as a new nuclear power. The five countries should take
concerted action in urging Pyongyang to take concrete steps,
including abandoning its nuclear programs and dismantling its
nuclear facilities.

Questioner: How about specific roles of the five countries?

Nukaga: In past negotiations, the five countries mainly offered
carrots to North Korea, but no agreement has ever been reached on
sticks. China, which has major influence over North Korea, should
apply more pressure on Pyongyang. Beijing has to exercise its
leadership as a responsible superpower, taking advantage of its
alliance with the North. South Korea has pushed ahead with a
conciliatory policy, but North Korea conducted a nuclear test. This
is the proof of the failure of Seoul's policy of placing emphasis on
dialogue with Pyongyang. South Korea also should step up pressure on
the North.

Questioner: South Korean Foreign Affairs and Trade Minister Ban Ki
Moon and US Under Secretary of State Nicholas Burns recently visited
Japan.

Nukaga: Japan and the United States are allies, as are the United
States and South Korea. So cooperation is important. It is necessary
for the five countries, including China and Russia, to constantly
cooperate and take action in unison. If the five nations do not
cooperate in implementing sanctions, the UNSC resolution will never
produce any effect.

Questioner: There are views calling for recognizing a regional
contingency.

Nukaga: Situations in areas surrounding Japan correspond to
emergency situations. Japan must ascertain North Korea's moves. I
would like to think about such should tensions grow more. However,
Japan needs first to exchange views with the United States, South
Korea and China before deciding that such a situation exists.

(6) Questions and answers about the debate on reform of the
education board system: Abe administration intends to deepen the
government's involvement

TOKYO SHIMBUN (Page 2) (Full)
November 5, 2006

Okihiro Iwata, Haruka Osugi

Calls for reviewing the present board of education system are rising
in conjunction with two issues: a succession of children committing
suicides due to bullying at school, and the failure of many high
schools to teach certain compulsory courses. There is a broad range

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of debates on the review of the current board of education system
from strengthening the functions of the system to dismantling it.
What are some of the problems associated with the boards of
education and what needs to be revised?

Question: What is a board of education?

Answer: It is a council in charge of things relating to school
education, lifelong learning, and promotion of arts, culture, and
sports. Every prefecture, city, town, and village is obligated to
establish a board of education respectively. Each board of education
is not under the control of the prefectural governor or the mayor of
the city, town, or village.

Q: Why is it independent from the head of a local government?

A: That's because neutrality and fairness are required in education.
The purpose is to avoid any influence of the head of a local
government or a certain political group.

Q: Well then, is the system of the board of education functioning
properly?

A: It's hard to say so. Regarding the recently revealed problem of
the failure of high schools to teach certain compulsory subjects,
the school principal was held accountable, but the boards of
education that failed to check to see whether the curriculum was
appropriate should also have been seen as a problem. The failure is
attributable in part to the cozy relationship between the
superintendent of the board of education and teachers, given that
the post of superintendent has been almost always been occupied by
former teachers. Another conceivable reason is that the members of
the board of education are part-timers, so they do not actually
engage in educational administration. State Minister in Charge of
Regulatory Reform Genichiro Sata criticizes the current state of the
board of education, raising this question: "Is it enough for
nonprofessional part-timers to gather only once or twice a month?"

Q: It is difficult to understand why a board of education must be
established in every prefecture, city, town and village.

A: Relations between the prefectural, city, town, and village boards
of education are so complicated that it is unclear who is
responsible and who has power and authority. For example, school
personnel at a municipal primary school are classified as employees
of a municipal government, but the authority over personnel issues
lies with the prefectural board of education. That's why even though
there might be a known bad teacher at one school, the local board of
education cannot do anything about it.

Q: Is it a wise policy for the central government to engage in
reforming the system of the board of education?

A: Considering Prime Minister Shinzo Abe's views of education and
the state, he surely wants to strengthen the central government's
involvement in the reform of the board of education. State Minister
Sata, as well, treats education on part with foreign policy and
defense affairs, and he has stated, "The central government will
guide and supervise."

But the government's engagement could give rise to criticisms like
"state control." The government's Council for the Promotion of
Regulatory Reform has come up with a report suggesting that the

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regulations requiring each municipality to establish a board of
education be repealed, and that power and authority be put in the
hand of the school principal on the responsibility of the head of a
municipality. In short, in view of decentralization of authority (to
local governments) and deregulation, the central government's
involvement in education goes against the spirit of regulatory
reform.

Q: We hear there have been calls for dismantling the board of
education system.

A: The opposition Democratic Party of Japan (Minshuto) asserts that
the board of education system should be abolished, and that the head
of the local municipality should serve as the top responsible
official for educational administration. But the problem about this
idea is that there may emerge a big difference in educational
administration from one community to the next. Incidentally, from a
political point of view, the ruling coalition parties are unlikely
to accept the opposition party's proposal. At any rate, the reform
of the board of education system is a difficult issue because it
involves the intricate relationship of education, local autonomy,
and deregulation.

SCHIEFFER

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