AMERICAN EMBASSY, TOKYO
POLITICAL SECTION
OFFICE OF TRANSLATION SERVICES
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DAILY SUMMARY OF JAPANESE
PRESS
Tuesday, April 6, 1999
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INDEX:
(1) Seven North Korean spy ships detected off
Noto Peninsula by ASDF radar; Provocation might be their mission
(2) Japan, Russia to hold maritime security
talks; Meeting likely in July due to North Korean spy ships' intrusion
(3) Issue of reforming medical insurance system
may affect Japan-U.S. summit meeting, with U.S. call for liberalizing
pharmaceutical prices; Japan urged to compile reform plan
(4) Kan to visit China
(5) Mainichi poll on Tokyo gubernatorial race:
Ishihara still in the lead followed by Hatoyama, Masuzoe; 69 percent will
definitely go to the polls
(6) Uphill fight going on in Japanese economy;
Slow external demand cannot be relied on; Europe also constraining exports to
U.S.
ARTICLES:
(1) Seven North Korean spy ships detected off
Noto Peninsula by ASDF radar; Provocation might be their mission
TOKYO SHIMBUN
(Top play) (Slightly abridged)
April 4, 1999
Chances
are high that the Democratic People's Republic of Korea (North Korea) had sent
a total of seven spy ships into Japan's territorial waters, a Japan Defense
Agency (JDA) source revealed on April 3.
All seven ships emerged in waters off the Noto Peninsula on the morning
of March 21 and five of them except the ships disguised as Taisei Maru No. 1
and Yamato Maru No. 2 fled in the direction of North Korea later in the
day. It is difficult for seven ships in
convoy to remain unnoticed by Japan.
This suggests that they were on a mission to provoke Japan.
On
the morning of March 21, Air Self-Defense Force (ASDF) radar sites, such as the
one in Wajima, Ishikawa Prefecture, and Sado Island, Niigata Prefecture,
detected several boats in waters off the Noto Peninsula.
Seven
of them circulated around Sado Island or headed for Toyama port but soon turned
back halfway. Such moves were obviously
different from those of fishing boats.
Later
in the day, five of them vanished in the Sea of Japan as they fled in the direction
of the Korean Peninsula. The boat
posing as Taisei Maru No. 1 came to a halt from engine trouble off Sado Island
and Yamato Maru No. 2 remained in the area as if to wait up for the recovery of
Taisei Maru.
Late
in the night, the JDA's radio communication center was monitoring
Korean-language messages emitted from the two boats. On the morning of the 23rd, a P-3C patrol plane spotted the two
ships.
Despite
the chase by a Maritime Safety Agency patrol boat, Taisei Maru No. 1 remained
stationary for 22 minutes due possibly to its engine trouble. Had there been no trouble, the two ships
might have vanished from the Sea of Japan as well.
The
seven ships did not reveal any signs that they had entered Japanese ports or
unloaded intelligence agents or supplies.
Yet, they were too conspicuous to remain unnoticed by Japan's
Self-Defense Forces. It is highly
likely that their mission was to raise tensions in Japan.
In
addition, it has been the North's pattern to throw a wet blanket on lenient
steps taken by Japan, the Untied States and South Korea. This time, the North sent the spy ships to
Japanese waters shortly after an agreement was reached between the U.S. and the
North over nuclear inspections.
The
JDA source perceives the incident this way: "The North's strategy is to
distract the starving people's attention and to elicit compromises from Japan,
the U.S. and South Korea. For that, the
North needs to create a highly tense situation. The submarine incident, a provocation to the South, and this spy
incident lie on the same extension line."
(99040502st)
(2) Japan, Russia to hold maritime security
talks; Meeting likely in July due to North Korean spy ships' intrusion
YOMIURI
(Page 1) (Full)
April 4, 1999
The
Japanese and Russian governments decided on April 3 to hold maritime security
consultations in Moscow this July at the earliest. In the wake of the recent incident of North Korean spy ships'
intrusion into Japanese waters, the two governments will discuss bilateral
cooperation for maritime security in Japanese and Russian waters covering the
Far East region. The two countries'
intergovernmental maritime security talks will be held with the participation
of Maritime Safety Agency officials from Japan and border guard authorities on
the Russian side.
Japanese
and Russian maritime security officials have ever met three times. However, the Japanese and Russian
governments used to hold consultations principally aiming at beefing up their
enforcement of control over the illegal practices of trafficking in such items
as small arms and narcotics. This time,
the two governments are going to hold their first full-fledged discussion of
maritime policing. In the recent
incident of North Korean spy ships' incursion into Japan's territorial waters,
Russian patrol boats joined in the chase of those suspected vessels in response
to the Japanese side's reporting to the Russian side of their heading in the
direction of Russia's territorial waters.
For the present, the Japanese and Russian authorities will likely talk
about such measures as to intensify information exchanges and cooperate in
maritime policing in the event of similar incidents.
The
Japanese government is now also planning to send a delegation to Vladivostok in
Russia around the scheduled maritime security talks, and is now making
coordination with the Pacific district headquarters of the Russian boarder
guard service to verify the two countries' cooperation in the recent incident.
(99040502im)
(3) Issue of reforming medical insurance system
may affect Japan-U.S. summit meeting, with U.S. call for liberalizing
pharmaceutical prices; Japan urged to compile reform plan
NIHON KEIZAI
(Page 2) (Full)
April 3, 1999
An
official of the Ministry of Foreign Affairs (MOFA) returned to Japan on the 1st
with a heavy step from Washington, which he visited to lay the groundwork for
the planned Prime Minister's visit to the United States scheduled for late
April. In the Japan-U.S. deregulation
negotiations held in Washington, both sides failed to find common ground over
pharmaceuticals and telecommunications.
In addition, the plan for Japan and the U.S. to present a joint report
in late March, simultaneously with the Government's three-year deregulation
promotion plan, was also postponed.
This is a result of the Ministry of Health and Welfare (MHW) having gone
back on the plan of sending responsible officials to the U.S. while the U.S.
resorting to an approach to draw out concessions from Japan by the time of the
summit meeting.
Deputy
U.S. Trade Representative (USTR) Fisher stated, "The top priority will be
given to a reduction in NTT's interconnection charges. The issue of adopting a pharmaceutical price
system based on market mechanisms will come second." For the U.S., pharmaceuticals are a
strategic industry in which it has the competitive edge, in addition to
information and communications. The U.S.
has fastened its eyes on the growing Japanese pharmaceutical market, given its
"health care system soaked with medicine." The U.S. Pharmaceutical Manufacturing Association (PhRMA) has
actively lobbied Liberal Democratic Party (LDP) members. In February, former U.S. Ambassador to Japan
Mondale visited Japan and called for liberalizing the market.
In
the U.S., patients have to shoulder the full amount of medicine fees under the
medical care insurance system for the elderly people. The Japanese insurance system, however, imposes only a small
portion of medicine fees on patients, depending on how much medicine they receive. MHW is concerned that if Japan, ignoring
this difference, liberalizes drug prices, payments for prescription drugs will
infinitely skyrocket, and health insurance societies may go bust.
In
discussions designed to constrain payments for medicines, MHW has studied the
possibility of introducing a system to categorize drugs by effect with each
category having a price cap. Under this
system, patients would be obliged to shoulder a financial burden when the price
of a drug exceeds the cap. The aim is to
reduce the overprescription of drugs.
The Japan Medical Association (JMA) has raised objections, asserting
that the MHW's proposal would "jeopardize the management of medical
institutions from their foundation."
Reflecting the JMA's opposition, the LDP has continued to criticize the
ministry. With pressure being applied
from the U.S., some signs of changes have appeared in the LDP's posture.
"Japan
should not budge from its stance in the upcoming Japan-U.S. talks." In a meeting on March 23 of the LDP Medical
Problems Study Council, Lower House Health and Welfare Committee Chairman
Yoshio Kimura unusually encouraged MHW.
Medical institutions can make on margin profits by constraining purchase
prices, premised on standard prices for medicine set by the government. The free pricing system will affect the
medical institutions more seriously than the price cap system. In view of their responses to the U.S., the
LDP, the JMA and the MHW are bitter enemies in the same boat, in a sense.
Domestic
debates, in which the JMA has exerted political influence, have become
complex. In a meeting of the Central
Social Insurance Medical Council on March 25, National Federation of Health
Insurance Societies Vice Chairman Shimomura stated, "We find it difficult
to revise medical fees under the current situation." Recession-hit companies have suffered from a
heavier burden of insurance payments.
The council has come up with a stance of refusing the revision of
medical fees despite of calls by JMA if no measures are worked out to contain
pharmaceutical and medical fees.
Toru
Toida, a Lower House member elected from Hyogo 11th District, stated:
"Discussion has been focused only on the stance of JMA, but priority
should be given to the people."
Jun Matsumoto, a Lower House member elected from Kanagawa 1st District
said, "A policy direction should be set before the coming Japan-U.S.
summit." In meetings of the LDP
Medical Treatment Study Group, first-term members reiterated the need to
quickly draft a reform plan. Such a
call stems from their anxiety that as a result of the LDP inclining toward the
industry, companies that have to shoulder insurance payments or salaried
workers' groups might begin to distance themselves from the LDP.
A
senior MOFA official stated, "If Japan fails to produce a reform plan
before the summit, it will result in allowing the U.S. to thrust requests. If Japan comes up with some reform plan, the
U.S. will find it difficult to intervene in Japan's domestic
affairs." After seeing the end of
the first-half campaign for the April 11 unified local elections, the LDP will
restart discussing how Japan should grope for a compromise agreement by the
time of the Prime Minister's visit to the U.S. while reflecting changes arising
in the domestic and foreign situations.
(99040501ys)
(4) Kan to visit China
YOMIURI
(Page 4) (Full)
April 3, 1999
Democratic
Party of Japan (Minshuto) Representative Kan told the press in the city of Nagoya
on April 2 that he would visit China during the forthcoming consecutive
holidays from the end of this month.
The DPJ is now coordinating his schedule with the China side.
(99040501im)
(5) Mainichi poll on Tokyo gubernatorial race:
Ishihara still in the lead followed by Hatoyama, Masuzoe; 69 percent will
definitely go to the polls
MAINICHI
(Top play) (Excerpts)
April 4, 1999
The
Mainichi Shimbun conducted a
telephone survey on April 2 and 3 to find out the latest trend of the Tokyo
gubernatorial election. The results
showed that among six major candidates, former transport minister Shintaro
Ishihara, 66, is still in the lead, followed by former education minister Kunio
Hatoyama, 50, political scientist Yoichi Masuzoe, 50, former UN undersecretary
general Yasushi Akashi, 68, former foreign minister Koji Kakizawa, 65, and
former school teacher Man Mikami, 67.
Hatoyams's gain in support is particularly noteworthy. Over 30 percent indicated that they have not
yet made up their minds. At the same
time, 69 percent -- up 4 points from the survey conducted before the election
was officially announced -- replied they would definitely go to the polls. The voter turnout is expected to exceed that
of the previous race (50.67 percent).
(99040501st)
(6) Uphill fight going on in Japanese economy;
Slow external demand cannot be relied on; Europe also constraining exports to
U.S.
NIHON KEIZAI
(Page 1) (Excerpts)
April 2, 1999
Production
facilities for ethylene, a raw material used for petrochemical products, have
been running at full capacity without stop since late last year. Ethylene
manufacturers, such as Showa Denko and Tonen Chemical, had to suddenly pull
back their plans to cut production.
Their output in February marked the highest volume ever recorded for
that month. The reason was an
unanticipated solid growth in exports to China.
However,
the faces of those connected to this industry are not beaming. High value-added products, as represented by
synthetic resin, are being overpowered by low-price sales of goods coming from
the Republic of Korea. As a result,
Japan's exports are centered on intermediary raw materials, such as vinyl
chloride monomers. Relying on exports
for 20 percent of its outturn, the petrochemical product industry is now
"fully occupied with profit-less production," that is to say, the
industry's production output is increasing, but profits are not.
It
has become difficult to envisage a pattern of economic recovery ignited by
personal consumption since trade disputes between Japan and the United States
became serious in the middle of the 1980s.
Three
"uncertain factors" are making it difficult for companies to rely on
external demand.
The
first such factor is concern over global-scale deflation. The price of cement exported to Asia has
dropped as much as 40 percent over the past year. Due to the aftereffects of the economic crisis there,
construction of buildings have been suspended in Bangkok and other Asian
cities. Accordingly demand for cement
has precipitously dropped. It is
expected that a "situation where it will take a couple of years until the
market picks up" will continue (Pacific Cement).
There
are signs appearing in the ROK and Thailand that the economy has bottomed
out. However, the situation is remote
from full-fledged recovery. Japan's
exports to East Asia in 1998 plummeted as much as 25 percent from the preceding
year. In view of the situation of Asian
economies, growth for 1999 cannot be expected.
The
second uncertain factor is relations with the U.S. The U.S. economy remains on the rise, while being tinged with
various possible risks, such as a reactive fall in stock prices.
However,
strong vacillation is seen among Japanese companies regarding embarking on the
export offensive against the U.S.
Democratic
Senator Rockefeller criticized the Clinton Administration's tackling of the
steel issue at a Senate hearing on March 23.
He said, "If the situation is left unattended, 75,000 jobs will be
lost in the steel industry."
Japanese companies, whose steel exports to the U.S. jumped in 1998, have
come under fire.
The
third such factor is a decline in Japanese companies' competitive edge. The international semiconductor market had
been enjoying brisk shipments for use in personal computer production. However, that market began to weaken in
mid-February, spreading uneasiness among domestic manufacturers. The price on the U.S. market of 64
megabit-DRAMs, the mainstay product, recently dropped in January from 10
dollars to eight dollars. A certain
trading company noted, "ROK firms have changed strategy away from a production
cut to an export offensive.
An
increase in exports by Japanese companies operating abroad is also applying
pressure on domestic production.
According to the Japan Research Institute, the share of imports in the
durable consumption goods market has recently soared to 7 percent from 5.5
percent registered at the end of 1996.
There
is a strong aspect of export-import trends being determined by the exchange
rate. According to a computer
simulation by NEEDS, a comprehensive economic data bank run by the Nihon Keizai Shimbun, if the yen
depreciates against the dollar by 10 yen, Japan's annual current account
surplus expands approximately 500 billion yen, pushing up the real gross
domestic product by 0.3 percentage point.
The yen exchange rate was above the 1 dollar = 110 level at the outset
of the year. However, now that the rate
has shifted to around 118 – 120 yen to the dollar, the sense of crisis harbored
by the industry world has eased.
The
Japanese economy in fiscal 1998 experienced its worst performance in the
postwar period. Imports slumped more
than exports. External demand
determined by subtracting imports from exports has apparently driven up the
real economic growth rate. However,
many private-sector economic research centers predict that the degree of
external demand's contributions to economic growth will be zero or will
slightly move into the minus column.
With
external demand remaining at a standstill, only a small range of options remain
available for the Japanese economy to get back on the road to recovery. Japan must expand domestic demand --
personal consumption and capital investment – in a self-reliant way.
(99040204yk)