Reference ID
09TOKYO317 2009-02-10 07:16 2011-05-04 00:00 SECRET Embassy Tokyo


DE RUEHKO #0317/01 0410716
O 100716Z FEB 09

S E C R E T TOKYO 000317


E.O. 12958: DECL: 02/10/2019

Classified By: Charge d’Affaires, a.i., James P. Zumwalt per 1.4 (b/d)

¶1. (S) Madam Secretary, Welcome to Tokyo. Prime Minister
Aso, Foreign Minister Nakasone and Defense Minister Hamada
are eager to see you to discuss our new Administration’s
foreign policy and ways to improve our global and regional
partnership. That your first stop on your first overseas
trip is Japan serves as a concrete reminder to Japan’s
leadership and public of the importance of our bilateral
relationship. Currently, issue #1 for Japan is the global
economic downturn compounded by a confused domestic political
situation. Although Japanese banks and financial
institutions had little sub-prime market exposure, the
country’s GDP saw a drop of 9 to 12 percent in the last
quarter of 2008. The economic outlook is gloomy with
expectations of deflation, rising unemployment, and continued
drops in demand for Japanese exports. Companies such as
Toyota and Sony are recording operating losses, paring
employment rolls and extending factory holidays.

¶2. (S) Fear about Japan’s economic well-being, combined with
its hamstrung political system have exacerbated
dissatisfaction with Prime Minister Taro Aso’s leadership,
resulting in a growing public sense that it may be time to
turn over government to the opposition Democratic Party of
Japan (DPJ). In a dramatic shift, polls show voters
increasingly consider opposition leader Ichiro Ozawa to be a
more suitable PM than Aso. That said, only Aso can dissolve
the Diet and call an election, and many believe that he may
do so after passing his budget this spring. Others suggest
he will try to hold on until September when the Diet’s
current term expires.

¶3. (S) Unfortunately, the political situation and an
increased focus on domestic issues limit Japan’s ability to
help resolve global problems. Many believe Japan missed a
chance as G8 chair to play a greater role in responding to
the global economic crisis, despite its pledge of $100
billion to the IMF as a credit facility and $2 billion to the
World Bank to launch a fund to help stabilize financial
institutions in developing countries. At home, Japan’s
response to the global economic slowdown has been short on
effective measures to stimulate domestic demand and business
and consumer confidence.

¶4. (S) Furthermore, after much political wrangling, the Diet
only recently passed legislation extending Japan’s refueling
activities in the Indian Ocean in support of Operation
Enduring Freedom. Japan continues to consider new
legislation to respond to Somali piracy, and its ongoing
deliberations contrast with China’s relatively quick decision
to dispatch ships to the region. In December, Japan’s Air
Self-Defense Forces ended operations in Iraq. Japan remains
a top donor for Iraqi reconstruction but Japan can do more.
We hope that you’ll underline the international community’s
expectations that Japan play a strong role in Iraqi and
Afghan reconstruction, as well as in combating piracy.

¶5. (S) Your interlocutors will want your thoughts on the new
Administration’s views of the bilateral relationship. In
particular, they will be eager to hear that our new
Administration will not take steps to strengthen the
U.S.-China relationship at the expense of the alliance with
Japan. Notably, polls show Japanese are becoming more
concerned about the state of the bilateral relationship,
partly reflecting uncertainty about our China policy, as well
as disappointment with our decision to delist North Korea as
state sponsor of terrorism.

¶6. (S) Your counterparts will want to discuss the Six Party
process. Many are highly focused on denuclearization
including the importance of sampling as part of a written
verification protocol. They remain skeptical the North
Koreans will ever commit to verification measures in writing.
While most Japanese recognize the importance of DPRK
denuclearization to Japan’s security, they nonetheless remain
highly emotional about abductions. A statement from you on
our continued commitment to achieving progress on DPRK
issues, including both denuclearization and abductions, would
be welcome.

¶7. (S) Our bilateral security ties remain robust and in this
area we have good news: our two countries recently reached
an International Agreement on the realignment of U.S. Forces,
which you and Foreign Minister Nakasone will sign. This
agreement, scheduled for Diet vote in March, will commit
Japan to completing the relocation of Futenma Marine Corps
Air Station on Okinawa and providing funds for USMC-related
facilities on Guam. Japanese officials believe the
agreement, and the allotment of over $900 million in
realignment funding during the next fiscal year, will
buttress Japan’s commitment to the May 1, 2006, Alliance
Transformation Agreement even if there is a change in
government here.

¶8. (S) In addition, Japan now hosts a forward-deployed
nuclear-powered aircraft carrier, our missile defense
cooperation is moving forward quickly and we are increasing
bilateral planning coordination and intelligence sharing.
While pacifism remains deeply ingrained in Japan, there is a
new consensus among the public and opinion makers — due in
part to the DPRK threat and the PRC’s growing power
projection capabilities — that the U.S.-Japan Alliance and
U.S. bases in Japan are vital to Japan’s national security.
For example, the main opposition DPJ, while taking issue with
some of the details of our basing arrangements, maintains as
a basic policy platform the centrality of the alliance to
Japan’s security policy. We recommend that you inform your
interlocutors we intend to hold an early 2 2 (Foreign and
Defense Ministers) meeting given the importance of the

¶9. (S) Japanese leaders will want your thoughts on the
Administration’s stimulus package, the auto bailout, and any
other responses to the global economic crisis. Japanese
officials -) and the public -) have questions about the
future course of U.S. trade policy. They are concerned about
a rise in protectionism and possible “”Buy America”” provisions
in the draft stimulus packages. You may be asked about plans
for the April G-20 Economic Summit. Our back-to-back years
hosting APEC (Japan in 2010, the United States in 2011) will
offer opportunities to promote policies to further trade
liberalization and regional economic growth and prosperity.

¶10. (S) Your visit is an opportunity to thank Japan for their
help in addressing climate change/energy issues, coordinating
on development and disaster assistance, and joint measures to
combat communicable and emerging diseases such as HIV-AIDS
and avian influenza. You may wish to urge Japan to continue
its work with the United States in the UNFCCC negotiations on
a post-Kyoto framework and to promote close U.S.-Japan
cooperation on climate change science.

¶11. (S) A quick reference list of issues follows. Embassy
Tokyo looks forward to seeing you soon.

— U.S.-Japan alliance: Our alliance is the cornerstone of
U.S. policy in Northeast Asia, and essential for preserving
peace and stability throughout the region. Force
transformation spelled out in the Defense Policy Review
Initiative (DPRI) will help sustain Japanese public support
for the alliance and will strengthen alliance capabilities.
Both countries are preparing the first set of major fiscal
expenditures for projects on Okinawa and Guam. It is crucial
that we implement our agreed upon plans without change.

— Climate Change: Japan has been a leader in the Major
Economies process and sees itself as a bridge between the
U.S. and EU on climate change. While Prime Minister Aso has
said he will announce a mid-term target for greenhouse gas
reduction by this June, Japan has been pushing a bottom-up,
sectoral approach to determining national greenhouse gas
reduction goals, as opposed to the top-down, cap-and-trade
policies promoted by the EU. Japan wants the United States,
and the emerging market economies including China and India
to be integral parts of any new global climate change

— Six-Party Talks: While Japan shared with the United
States disappointment at the outcome of the recent round of
Beijing talks, the Japanese were extremely pleased with
U.S.-Japan-ROK coordination. Japan remains firm in its
refusal to provide energy assistance to the DPRK absent
progress on the abductions issue. The DPRK’s August 2008
pledge to open a reinvestigation into the abductions remains
unfulfilled, in spite of a Japanese promise to reciprocate by
partially easing its unilateral sanctions.

— Iraq: With $1.5 billion in grants, up to $3.5 billion in
concessionary loans, and $6 billion in debt relief, Japan is
the second-largest contributor to Iraqi reconstruction.
Japan’s Air Self-Defense Forces had deployed 200 personnel
and three C-130 aircraft in Kuwait to transport cargo and
personnel in Iraq; they returned home in December 2008.

— Afghanistan: In December 2008, Japan passed legislation
to extend by one year the refueling operation in support of
Operation Enduring Freedom. Japan is working more closely
with the PRTs and has assigned a full-time liaison officer to
NATO’s office in Kabul. Japan is the third highest bilateral
contributor (behind the U.S. and UK) to Afghanistan, with
$1.4 billion pledged since 2002. Japan has included an
additional $300 million in its latest supplemental budget to
support the 2009 Afghan elections and other security
programs. It has also funded the upgrade of the Self-Defense
Force’s expeditionary capabilities in anticipation of a
future political decision to deploy forces to ISAF. Japan’s
most visible endeavor in Afghanistan is the construction of a
114-kilometer stretch of the southern ring road. This
project, originally scheduled for completion in 2005, has
been beset by delays stemming from Japan’s security concerns.
We have been pressing them to complete the road and have
also been asking the Japanese to consider other ways to
support Afghanistan that are politically and constitutionally

— China: Former Prime Minister Fukuda worked hard to
improve relations with China, but his sudden resignation in
September 2008 — and the subsequent political uncertainty )
has led to a slow-down in progress on bilateral issues such
as food safety and an agreement on joint development of East
China Sea resources. In a positive development, both China
and Japan have been successful in defusing, for the time
being, the sharp conflicts over history that damaged relation
in the Koizumi years. While Japanese acknowledge that good
U.S.-China relations are in Japan’s interest, they also fear
that the United States will discount Japan’s interests in
pursuit of more robust relations with China.

— South Korea: Although the Takeshima/Tokdo territorial
dispute remains an irritant, both sides have expressed a
desire to build a Japan-ROK relationship that is “”different
from the relationship up until now,”” including through
high-level shuttle diplomacy.

— Burma: Japan has scaled back its aid to Burma, but has
not imposed economic sanctions, although it discourages
companies from investing in Burma. Japan could do more, but
fears driving Burma closer to China.

— Middle East Peace Process: Japan is moving forward with
its “”Corridor for Peace and Prosperity”” initiative that will
establish an agro-industrial park in the West Bank, and
pledged $150 million in project assistance at the December
2007 Paris donors’ conference. Last August, Japan resumed
direct assistance to the PA, contributing $20 million. Japan
has urged Israel and Hamas to adopt an immediate ceasefire.

— Iran: Japan is implementing UNSCRs 1737, 1747 and 1803.
Japan is among Iran’s top export markets (mostly oil) and is
Iran’s 10th largest supplier of machinery and manufactured
goods. A great deal of Japan-Iran trade is covered by
government guaranteed short-term credits. Still, since April
2006, the Japan Bank for International Cooperation (JBIC) has
ceased issuing Iran new long-term export credits and Japan
has promised to begin closing outstanding long-term credits.

— Beef: Japan remains closed to U.S. beef and beef products
from animals older than 20 months of age. We continue to
insist Japan allow full market access for U.S. product based
on World Organization for Animal Health (OIE) guidelines and
science. Once our largest export market for beef, Japan now
imports less than 25 percent of pre-2004 levels. Japanese
interlocutors will look to see how hard the new
Administration will press on this issue.

— UN Reform: Japan continues to call for an expansion of
the UN Security Council to allow for its permanent membership
(its two-year term as a non-permanent member began January
1). The United States believes that Japan is well-qualified
to become a permanent member and Japan’s candidacy is the
only one we have specifically supported.

— Nonproliferation: While Japan’s delegations are perhaps
not always as vocal in international non-proliferation fora
as we would like, Japan is generally supportive of U.S.
non-proliferation efforts, and, in part due to its history,
holds a firm, legalistic line on proliferation issues. Japan
is active in the IAEA (Japan’s nominee is one of the leading
candidates to replace Director General El Baradei), supports
the IAEA’s Additional Protocol for all states, and has
generally sided with the U.S. in the ongoing IAEA
investigations of Iran and Syria. Regionally Japan has taken
a leadership role through its involvement in the Asian
Senior-level Talks on Non-Proliferation (ASTOP). Japan has
been responsive to UNSC resolutions calling for sanctions on
known proliferators, but has generally refrained from acting
on US-initiated sanctions efforts that do not originate in
the UNSC.

— Child Pornography: Public opinion has responded
positively to Ambassador Schieffer’s public campaign to
encourage Japan to criminalize the possession of child
pornography, which remains legal in Japan and Russia alone
among the G8 member countries. We hope that a law
criminalizing possession will be passed in the next Diet

— Hague Convention on Parental Child Abductions: We and our
Canadian and EU colleagues continue to press Japan to accede
to the Hague Convention on the Civil Aspects of International
Child Abduction. However, our Japanese interlocutors remain
insistent that bureaucratic, legal and cultural barriers make
near-term progress difficult.

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