Provisional

Execution and Realization of the Growth Strategy under the Abenomics
PolicyDecember 27, 2014
Decided by the Headquarters for Japan’s Economic Revitalization

The Japanese economy has staged a remarkable turnaround in the twoyears since the inauguration of the government of Prime Minister Shinzo
Abe.
A deflationary mindset was prevalent among both companies and people
as a result of the economic stagnation that lasted for more than twodecades. However, the Abe government has placed top priority on theeconomy in policy management and has implemented a three-arroweconomic policy in the belief that restoring the strength of the Japanese
economy is what the people desire and is Japan’s national interest.
As a result, a virtuous economic circle has begun to turn, as corporate
profits have recovered, leading to expanded employment and wage hikes,
which in turn is contributing to a further economic recovery throughincreases in consumption and investments.
Our understanding is that at this time, the people have expressed highhopes for the growth strategy pursued by the Abe government and they
have given us a strong request for the execution and realization of thestrategy.
In order to continue consolidating the virtuous economic circle throughwage hikes, etc. and put the Japanese economy on the path to a fullrecovery, it is essential to strengthen the efforts to execute and realize thegrowth strategy.
To that end, Japan must aim to become the most innovative country in
the world by carrying out social and economic structural reforms. The
Government, companies and people must all change.
However, there is little time left for reforms. It is important to carry out
reforms at an unprecedented speed with an unwavering resolve in order tochange the economic conditions for the better as soon as possible.
The Government will quickly work out specific measures and put them into
practice with regard to the matters pointed out in “Japan Revitalization
Strategy” (Cabinet Decision on June 14, 2013) and “Japan Revitalization
Strategy Revised in 2014” (Cabinet Decision on June 24, 2014) and will
carry out reforms in accordance with the following three principles.
First, Japan will create new markets and new business opportunities byreforming the so-called bedrock regulations concerning such sectors asagriculture, employment, healthcare and energy with no steps backward.
Additional regulatory reform items will be adopted for the National
Strategic Special Zones as breakthrough points for reform. In addition, it isimportant to promote inward foreign direct investment and accelerate
reforms by using “2020,” the year when the Olympics and Paralympics will
be held, as a new reform momentum.
Secondly, in order to increase Japan’s “earning power”, efforts will bemade to change Japanese companies’ characteristics and behavior as wellas their corporate governance and to dramatically change the businessenvironment through measures including growth-oriented corporate tax
reform. In addition, industrial restructuring will be promoted through therevitalization and productivity improvement of service and other industries.
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As for the enhancement of corporate governance, a new Corporate
Governance Code that provides for the election of independent outside
directors and improvement of the environment concerning the exercise ofshareholders’ rights will be drafted.
The management of public and quasi-public funds, etc. will be reviewed,
and the Government Pension Investment Fund (GPIF) will steadily manage
assets based on its revised policy asset mix. The Government will consider
the need for future legal amendment and other matters in order tostrengthen GPIF’s governance system.
The reform of universities and public research institutes will also be
promoted so as to establish a national system of innovation. Through thesemeasures, the way the market and industry work will be dramaticallychanged.
Thirdly, in order to maximize Japan’s labor force and improve laborproductivity, efforts will be strengthened to enable women and young andelderly people, etc. to actively participate in society and to utilize foreign
human resources. Reforms will be promoted so as to facilitate ways ofworking in which workers are rewarded for their performance as well as
flexible and diverse ways of working, thereby realizing a “world-leading
employment environment.”
In addition, Japan’s human resource capabilities will be enhanced
through the creation of a system to ensure that investments in humanresources are continuously made in an effective manner.

To secure the chance for Japan to break free from deflation, which hascome within reach at long last, all of us in the third Abe cabinet areresolved to carry out structural reforms intended to realize the “JapanRevitalization Strategy.”３

We will pursue the growth strategy under the Abenomics policy so as tospread the effects of the economic recovery to all regions of the country bycontinuing to vigorously turn the virtuous economic circle.

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