Cablegate: Daily Summary of Japanese Press 08/26/08

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UNCLAS SECTION 01 OF 03 TOKYO 002339

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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 08/26/08

INDEX:

(1) Georgian ambassador to Japan says Georgia wants to discuss
status of separatist regions with Russia (Nikkei)

(2) METI to request 130 billion yen for new energy sources, 1.5
times more than in fiscal 2008 budget (Mainichi)

(3) Shaky borders between Japan, China and South Korea: Takeshima
(Part 1) -- Fukuda, Lee enduring public opinion (Mainichi)

ARTICLES:

(1) Georgian ambassador to Japan says Georgia wants to discuss
status of separatist regions with Russia

NIKKEI (Page 9) (Full)
August 26, 2008

Georgian Ambassador to Japan Ivane Matchavariani yesterday gave a
speech at the Japan National Press Club. Referring to the future
status of South Ossetia and Abkhazia, the ambassador stated:

"We tried to talk with Russia about solutions, including their
division. But they had no ear to listen to us. Although it may take
more than 10 years, we want to take time to discuss it again."

(2) METI to request 130 billion yen for new energy sources, 1.5
times more than in fiscal 2008 budget

MAINICHI (Page 1) (Full)
August 26, 2008

The Ministry of Economy, Trade and Industry (METI) decided yesterday
that it would allocate approximately 130 billion yen in its budget
request for fiscal 2009 to fund measures related to new energy
sources, such as promotion of solar-power generation. This figure is
about 1.5 times more than in this fiscal year's budget. Given
soaring oil prices and global warming, the government has to
diversify the nation's energy sources as a priority task. The energy
issue was also high on the agenda at the July Hokkaido Toyako
Summit.

METI will incorporate in its budgetary request outlays for a subsidy
system for households to introduce a solar-power system or a
fuel-cell system. The ministry will also increase budgetary
allocations for measures to promote such next-generation automobiles
as electric vehicles and to prompt companies and local governments
to introduce large-scale solar-power generation systems.

In addition, METI intends to allocate over 120 billion yen, about 30
billion yen more than in this fiscal year, as expenses related to
energy conservation, such as subsidizing companies' capital
investment in that regard. The ministry will also propose more than
100 billion yen, an increase of about 40 billion yen, to finance
technical innovation, such as research and development on carbon
capture and storage (CCS) to mitigate global warming by capturing
carbon dioxide from thermal power plants and other sources and
storing it in the ground.

(3) Shaky borders between Japan, China and South Korea: Takeshima
(Part 1) -- Fukuda, Lee enduring public opinion

TOKYO 00002339 002 OF 003

MAINICHI (Page 5) (Abridged slightly)
August 26, 2008

The Fukuda administration advocates Asia diplomacy that can resonate
with the Japan-U.S. alliance. Cooperation with China and South Korea
is the centerpiece in Asia. The first Japan-China-South Korea summit
will take place in Kobe on Sept. 21. The trilateral summit regime is
a midterm compilation of the Fukuda diplomacy's efforts to bring
stability to Japan's relations with China and South Korea that
became icy because of visits to Yasukuni Shrine by former Prime
Minister Junichiro Koizumi. The improved relations can suffer a
setback even with minor discord over territorial issues that can
inflame nationalism.

South Korean President Lee Myung Bak delivered a speech on Aug. 15,
on the 63rd anniversary of national liberation from Japan, in which
he said: "We should make our country powerful so that Japan will not
unjustly covet our territory."

Although it was only one month after Seoul's de facto recall of its
ambassador to Japan in reaction to Tokyo's decision to specify the
row over the Takeshima islets (Dokdo in Korean) in the new
curriculum guidelines for middle school teachers, Lee stopped short
of using a harsh expression. It was a clear shift from the
provocative attitude of his predecessor, Roh Moo Hyun, who in the
annual event years earlier, cited many outstanding bilateral issues,
including the Dokdo issue, history textbooks, visits to Yasukuni
Shrine, and the wartime comfort women issue.

Koizumi continued paying homage at Yasukuni Shrine in defiance of
fierce protests from neighboring countries. As if to counter his
visits, Roh played up the Takeshima and history issues in dealing
with Japan. Both Koizumi and Roh used some bilateral issues for
buoying up their administrations even through hard-edged arguments
in their countries occasionally escalated into storms. In contrast,
Lee and Fukuda are apparently trying to move away from such an
approach.

The Takeshima issue was not taken up in the Fukuda-Lee meeting in
April this year. Asked about historical issues, including the
Takeshima issue, in a press conference after his meeting with
Fukuda, Lee emphatically said: "I hoped no one would ask such a
question. We should not let the past prevent us from going toward
the future."

But when Japan specified the Takeshima issue in the new manual for
teachers in July, South Korea raised a strong objection, putting the
bilateral relations at the risk of a setback. With his support
ratings hovering around 20 PERCENT at the time due to the U.S. beef
import issue, Lee could not afford to display his weakness to the
public. To demonstrate his resolute stance, Lee sent Prime Minister
Han Seung Soo to tour the Takeshima islets after recalling his Tokyo
envoy.

Triggered by the teaching manual, Tokyo tried to give more
consideration to South Korea. Before making the decision, the chief
cabinet secretary, foreign minister, and education minister met and
decided to drop the expression, "Japan's inherent territory." A
former cabinet minister representing education-related interests
indicated that the meeting was led by Fukuda behind the scenes,
saying, "The prime minister repeatedly exchanged views with the

TOKYO 00002339 003 OF 003

education minister and others until the last moment."

Suffering from low support ratings like Lee, Fukuda was not able to
give excessive consideration to South Korea in anticipation of a
backlash from hardliners in the Democratic Party of Japan. Since the
teaching manual brought South Korean public opinion to a boil,
Fukuda has had no other option but to wait for it to calm down.

Lee's Aug. 15 speech that did not criticize Japan outright has been
taken by Tokyo as his message to improve relations with Japan. A
senior Foreign Ministry official emphasized a plan to deal with
South Korea cautiously, saying: "In the upcoming Japan-China-South
Korea summit, Japan will not broach the Takeshima issue. Arguments
would ruin the cooling-off period."

ZUMWALT

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