Morning Alert   -   Wednesday, May 15, 2019
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Morning news

NHK led with a report saying that while senior LDP officials maintain that there is no change in the plan to increase the consumption tax, some assert that it is necessary to watch the economy closely because economic indicators are pointing to a possible economic slowdown. NTV reported on the start of the rainy season in Kagoshima and heavy rain in several locations yesterday. Fuji TV's top story was about a fire in Tochigi Prefecture this morning that killed three people. TBS reported on the Los Angeles Angels' Shohei Ohtani hitting his first home run since undergoing arm surgery. TV Asahi filed a report on a man who was arrested for stealing rubber boots on numerous occasions.

Major front-page items included the announcements made on Monday by the U.S. and the Chinese governments on additional tariffs on each other's products, Nissan's poor performance in the fiscal year ending in March, and repercussions of Japan Innovation Party lawmaker Hodaka Maruyama's remark that Japan may need to wage war with Russia to regain control of the Northern Territories. Maruyama was officially expelled from the party yesterday.


No end in sight to "tariff war" between U.S., China

All national dailies reported extensively on what they called the "escalated trade war" between the U.S. and China, underscoring that the prolonged trade friction between the world's two largest economies may potentially hamper global economic growth since both sides appear determined not to make concessions any time soon. The papers projected that the Japanese economy will probably be hit hard by the latest U.S. punitive tariffs that will cover smartphones, domestic appliances, textiles, and other daily necessities because many Japanese manufacturers of these products operate extensive supply chain networks across China to assemble them for shipment to foreign markets, including the U.S. According to the dailies, corporate output and exports to China will probably drop, resulting in a contraction of Japan's GDP. Stock prices may also plummet, as market players are bound to become bearish about the economy.

Noting that President Trump is likely to hold talks with his Chinese counterpart Xi in Osaka in late June on the sidelines of the G20, the articles predicted that the summit will be a crucial point in determining the course of the global economy as both sides will probably choose to enforce their fourth rounds of punitive tariffs if no agreement is reached. Yomiuri added that a breakdown of the Sino-U.S. trade talks could adversely impact the ongoing trade liberalization negotiations between Washington and Tokyo because the Trump administration may be tempted to step up the pressure on Tokyo to obtain quick deliverables in the absence of a deal with Beijing.

As for the GOJ reaction to the U.S.-China trade friction, Asahi took up remarks Finance Minister Aso made to the press on Tuesday. He reportedly projected that the friction will not be resolved easily because the two countries are apparently "competing for hegemony." With regard to the tit-for-tat tariffs, the cabinet minister was quoted as saying: "Measures designed to restrict trade do not serve anyone's interest."


Abductees' families welcome President Trump's plan to meet with them

According to Sankei, family members of the Japanese abductees felt encouraged by Prime Minister Abe's announcement on Tuesday that President Trump will meet with them when he visits Tokyo later this month. They reportedly voiced strong hope for continued support from the U.S. leader for repatriating their loved ones. Sakie Yokota, the mother of Megumi Yokota, reportedly told the press: "Members of the international community needs to coordinate to resolve the abductions. I would like to convey to the President our strong wish to bring the victims home immediately. I want to hear the President's thoughts on the matter. North Korea will have a bright future if Kim Jong Un decides to settle the abduction issue. Japan and the United States should take the lead in pressing North Korea to take the right path."

Japanese envoy to U.S. says Japan, U.S. in "full agreement" on DPRK policy

NHK aired an exclusive interview with Japanese Ambassador to the U.S. Sugiyama this morning ahead of President Trump's visit to Japan next week. Commenting on Prime Minister Abe's plan to meet with the DPRK's Kim Jong Un unconditionally in order to resolve the abduction issue, Sugiyama said: "Based on their close communication, Japan and the U.S. are in full agreement on the overall concept and direction" of policy toward North Korea. He was shown stating that the fact that the President will be the first state guest to meet with the new emperor will "definitely" symbolize the unshakable bilateral alliance. Sugiyama said that since the two leaders agreed in April to step up negotiations in the bilateral trade talks, concrete discussions will be accelerated going forward.


Deployment of ground-based missile defense system may be delayed

Nikkei wrote that the Defense Ministry's plan to deploy Aegis Ashore batteries at two SDF bases beginning in FY2023 may be postponed due to a delay in the development of the radar system to be installed on the missile defense platform by Lockheed Martin. As the production of Solid State Radar (SSR) is expected to take five years, the system may not become operational until FY2024 or later. The proposed participation of a Japanese defense contractor in the SSR development was reportedly aborted on the grounds that its involvement would further delay the production by eight months. The article added that the Japanese government will now have to negotiate with the USG on how to share the cost for the radar development, pointing out that Washington is asking Tokyo to pay part of the cost of constructing a testing facility and conducting interception tests. The paper quoted Defense Minister Iwaya as saying at the Diet in March: "If Japan is required to shoulder such expenses, we will need to hold negotiations [with the U.S.] on reducing the overall cost." The GOJ reportedly signed a contract with the USG in April on the payment of almost 140 billion yen ($1.3 billion) to cover part of the cost of purchasing the Aegis Ashore batteries.

SDF Ospreys to be deployed in Chiba on provisional basis

Asahi claimed that the Defense Ministry has decided to provisionally deploy at SDF Camp Kisarazu in Chiba Prefecture a fleet of MV-22s that the GSDF plans to procure given that the original plan to base them at Saga Airport has run into difficulties due to local opposition. While MOD officials are reportedly planning to brief the local municipal government in the near future on the provisional deployment, concern may grow among local residents that the municipality may end up hosting the Ospreys indefinitely.

U.S. Embassy Tokyo Media Analysis and Translation Team