Provisional

Japan Revitalization Strategy 2016

Section 1 Outline
I. Basic Concept of Japan Revitalization Strategy 2016
(Mission of the Growth Strategy Second Stage)
In the First Stage of the Growth Strategy, the Abe administration has cut into
areas where the so-called “bed-rock” regulations remain, such as electricity,
agriculture and healthcare, which have been considered taboo. It has carried out
reforms that have been thought to be impossible, such as a drastic reduction ofeffective corporate tax rates, signing the TPP(Trans-Pacific Partnership)
agreement, and enhancement of corporate governance. The so-called “sextuple
whammies,” which have been heavy drags on Japan’s business development, has
improved dramatically. In fact, since the regime change, the nominal GDP
increased by about 30 trillion yen and the number of employees increased by over1 million. Company earnings have reached the highest level on record. The
administration will strive to turn this new positive growth cycle to a sustainablegrowth and achieve “the highest nominal GDP of 600 trillion yen” in the postwar
period.
On the contrary, private entities are not fully in action. Population of Japan will
begin to decrease in full scale before the rest of the world and face a big challenge
on both the supply and demand sides. The long-term stagnation in the world has
been pointed out, where new demands or potential growth abilities are notexpected to arise in developed countries. Economic growth in developing
countries including China has weakened, and the future of the economy is
becoming increasingly uncertain.
In order to tackle these problems and realize a GDP of 600 trillion yen, it isessential for companies in Japan to have positive determination on shifting theirinternal reserves into future investment on facilities, innovation and humanresources. Accordingly, it is necessary to carry out further reforms to challenge
the following issues:
1) Strategic cultivation of new “promising markets”;
2) “Revolution in productivity” to overcome supply regulations and workforce
shortage associated with population decrease; and3) “Enhancing capabilities of individuals” to facilitate transformation of theindustrial structure1This is the new mission of the Growth Strategy Second Stage.
The possibility of significant development is turning real through theconversion of business models including technological innovations such as Big
Data and artificial intelligence and making agriculture the Sixth Industry. We willdevelop potential demands by providing new values and tackling social problems,and strongly promote the “revolution in productivity” to overcome supply
regulations in the society of decreasing population.
In the Second Stage of the Growth Strategy, we will develop these potentials
into a big cross-industrial wave beyond the framework of existing organizations
and industries. The “10 strategic public-private joint projects” will be launched, inwhich the public and private sectors will share knowledge and strategy, andcultivate new promising markets.
(The fourth industrial revolution and the cultivation of promising markets)
The “fourth industrial revolution” that uses the technological breakthrough of
IoT (Internet of things), Big Data, artificial intelligence and robot sensor is themost important key to leading future revolution in productivity.
The fourth industrial revolution creates new businesses that resolve social
issues and arouse consumers’ potential needs. On the other hand, it can change
the existing social system, industrial and employment structures completely. Do
we convert the existing framework and create new businesses that resolve social
issues before the rest of the world do, or do we continue to serve for overseas
platforms? While the fourth industrial revolution is a chance to tackle the problemof population decrease, it can also result in the collapse of the middle-income
group.
The fourth industrial revolution will bring a significant change in the entire
economic and industrial social system from technology and business models toskills and ways of working required for workers. It is necessary to share a future
image of the new social system as well as industrial and employment structuresand conduct a reform in Japan as a whole based on the map created for the goal. It
is important to focus on speed and carry out advanced ideas in a “first come, firstserve” way.
The first step toward the strategy to survive the competitive fourth industrial2

revolution is to analyze the strategy of the world’s major competitors and Japan’s“strong and weak points” in order to define fields in which we compete with othercountries. In the first stage of the revolution, Japan got a late start in obtaining aplatform of “virtual data” generated in the Internet space. However, in the second
stage, our country showed a potential competitive advantage in “real data” suchas health information, traveling data, and operation data of factory facilities. We
will therefore aim to obtain a platform of “real data” in the second stage beyond
the framework of existing entities and industrial groups.
(Introduction of a new mechanism for regulatory reforms)
We will introduce two new reform mechanisms in order to carry out further
reforms for the realization of becoming “the most business-friendly county in theworld.”First, we will introduce a “road map method for the back calculation of goals.”
During the fourth industrial revolution, it will be difficult to foresee technologies
and speed always comes first. We will therefore share the future image - by when
and what technologies we will implement in the society - between the public andprivate sectors, and introduce a method to design the process of the system reform
in details adopting a back-casting approach.
Second, we will reduce regulatory and administrative costs, from theperspectives of business operators. The government has implemented regulation
reforms, simplification of administration procedures and the use of IT for
administration procedures separately. However, from the viewpoint of businessowners, costs of regulation and administration procedures have influence on theircompetitiveness. For them, this is the element of deciding whether they invest in
domestic markets or overseas markets. Therefore, we will introduce a newmechanism to reduce all regulatory and administrative costs from the viewpointof business owners by integrating regulation reforms, and simplification ofadministration procedures and the use of IT in administration procedures.
(Strengthening of innovation and human resources)
The keys to realizing the fourth industrial revolution is open innovation andhuman resources. Under the difficulties of foreseeing future new technologies, it
is clear that there is a limit for a company to make products only by its own
technology. It makes the difference whether Japan can become a country that
attracts top-level human resources, technologies and capital from the world3

beyond the industry-academic-government framework.
As the fourth industrial revolution progresses, changes in industrial andemployment structures will be inevitable. The relationship between company andindividuals will also change. If we don’t change ways of human resources
development, labor market and way of working, employment opportunities andincomes will decrease, and the middle-income group will collapse, polarizing
income groups.
Waves of the fourth industrial revolution provide young people an opportunity
to “change the society and play an active role in in the world.” We will makeprogramming education compulsory and introduce individualized learning
depending on each person’s level of understanding using IT, so that young people
in Japan survive and lead the era of the fourth industrial revolution.
We will also realize university and National R&D Institute reforms andconsiderably expand joint research activities between industry and academia.
In order to attract world’s top level human resources, Japan will become oneof the first countries to introduce “Japanese Green Card for Highly Skilled
Foreign Professionals” which is the fastest such system in the world.
(Japan Revitalization Strategy 2016)
The time is about to change greatly. Japan is now at a historical crossroads interms of whether we should aim for a new growth path without fear of change, orwhether we should continue on a path of serving for the world’s leading
companies. The government will make efforts to make Japan the most attractive
country in the world by overcoming such an era of transformation and putting it
on a growth track.
In this regard, Japan Revitalization Strategy 2016 acts as a guiding compass indeciding what actions Japan should take.

4II. Key Policy Measures in the Japan Revitalization Strategy 2016
1. “10 strategic public-private joint projects” toward GDP of 600 trillionyen
1-1: Cultivation of new promising growing markets(1) The fourth industrial revolution (IoT, Big Data, artificial intelligence)In the future, IoT will enable us to connect everything via the Internet, throughwhich the so-called “Big Data” is collected and accumulated. Big Data isanalyzed by artificial intelligence and more and more products and services thathave previously been unimaginable will appear in the world using the analysis
results, robots, information terminals, etc. Cyber and physical space will be
integrated in an advanced manner, new business models will emerge without aboundary between the provider and consumer of goods and services, many social
issues will be resolved, and the quality of life will improve dramatically. Thesewaves of the fourth industrial revolution are emerging faster than we can imagine.
There are global debates about whether artificial intelligence is greater thanhuman intelligence. An idea of using data could change the person who possesses
competitiveness overnight. The key point is how Japan combines its strong areas(e.g. manufacturing sites) with technology (artificial intelligence, etc.) that plays
an important role in the fourth industrial revolution. Although Japan has a chance
to win in the competition, it’s now or never.
During the fourth industrial revolution, it is difficult to foresee the direction of
innovation in technologies and business models and the priority is put on speed in
an absolute manner. “Waiting” passively can be a fatal mistake for bothgovernment and private sectors. We should consider business strategies thatutilize technologies and the strong point of Japan by collecting
industry-academic-government knowledge and backcasting the image of future
shared by public and private sectors. Under these circumstances, it is necessary to
promote detailed projects such as the development of business models by private
sectors, regulation and system reform by the government, and the promotion oftechnological development and the promotion of data platform development
through cooperation between the government and private sectors. Needless to say,5

when promoting these policies, it will become more important to secure cybersecurity that can respond to the explosive increase in data amount and drastic
increase in the added value of data.
As it is difficult to foresee the future during the period, the speed of businessmetabolism needs to be faster. The importance of prompt replacement in open
innovation and business areas will become more and more important. Financial
and capital markets will require supply for growth capital depending on thebusiness more than ever.
We need to develop human resources as quickly as possible. What will be theskills and duties required for workers when the fourth industrial revolution
progresses? It is necessary to consider human resources development bybackcasting from the future image.
Small and medium-sized companies are the key to spreading the fourthindustrial revolution throughout Japan. It is important to introduce IT and robots
in business operations based on the needs and viewpoint from the side of small
and medium-sized companies. We will significantly reduce the cost of
introducing small-sized general-purpose robots and carefully provide as muchsupport as possible for the introduction of IT and robots based on the actual
condition of individual business, operation flow, etc.
Can we deal with the various changes that are rapidly occurring? While amoment of delay could cause a fatal error, issues are diverse and cross-sectional
responses are required. Therefore, as a new command center of the government as
a whole to promote the fourth industrial revolution, we will establish, under the
Headquarters for Japan's Economic Revitalization, the “Public-Private Council
for the fourth Industrial Revolution” that takes the overall control of government
efforts.
In promoting the fourth industrial revolution, we will coordinate with theconsideration of the basic policy of the Society 5.01 strategy formulated by theCouncil for Science, Technology and Innovation.
1

Society5.0 is a strategy to realize a “super smart society,” the fifth society on record ahead of therest of the world. In this society, new values and services will be created one after another throughactivities including the active use of cyber space and abundant life will be brought to people who
lead the society (it means that science and technology innovation will lead changes that create a
new society that follows a hunting society, agricultural society, industrial society and informationsociety).

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<Key policy measures>
1) Establishment of the “Public-Private Council for the fourth Industrial
Revolution” - a comprehensive command center.
2) Specifying research and development and the strategy ofindustrialization in the “The Artificial Intelligence Technology
Strategy Council”.
3) Regulation and system reform (“road map method for the backcalculation of goals,” “promotion of regulation reform, simplificationof administration procedure and utilization of IT in an integrated
manner”), promotion of projects, etc. for data use beyond theframework of companies and organizations and ensuring security.
4) Promotion of business metabolism and streamlining of businessrestructuring toward the fourth industrial revolution.
5) Substantiation of human resources development and education-related
measures in the “Council for Promoting Human Resource
Development to respond to the Fourth Industrial Revolution”.
6) Dissemination of the fourth industrial revolution in medium-sized andsmall and medium-sized companies.
(2) Toward a world leading healthcare country
The fourth industrial revolution will change the form of healthcare and nursing
care.
The growth potential in health and preventive services is extremely high. As
wearable terminals are becoming more popular and preferences of individuals
toward health and preventive services are increasing and diversifying, it isconsidered that demands for these services will increase drastically in the future.
Health and preventive services are expected to be effective for the moderation in
healthcare and nursing care costs. The size of potential demands corresponds tothe size of business opportunities. We will provide high-quality services forvarious needs in a flexible and efficient manner. Establishing a business model ofservice provision to create a growth industry is a big challenge.
In addition to health insurance claims and health checkup data, collection ofdata using IoT such as wearable devices will allow better design of services
based on individual situations more quickly. In the existing measures of the7growth strategy, “data health” and “Health and Productivity Management” havebecome established among insurers and companies. Under these circumstances,
we will look into what kind of “individualized health services” we can support toprovide using technological innovation. We need to design the system to provide
an incentive for the efforts of prevention and health promotion using ICT, etc.
Besides the use of ICT, we should accelerate the use of new technologies suchas Big Data and artificial intelligence, robots, etc. in the existing areas (so-called
medical and nursing care sectors) in order to adapt to the fourth industrial
revolution. During the revolution, drug development, development of medical
device and individualized services based on vast amounts of clinical data and thestate of individual patient will be realized, and higher-quality services will be
provided to each person. Burdens on medical and nursing care fields will be
reduced dramatically from the use of nursing-care robots to medical imaging andthe streamlining of clerical work. Workers in the medical and nursing care fields
will be able to focus more on the provision of careful services, team medicine andteam nursing care based on patients and people in need of nursing care, which
Japan has boasted.
In the medical field, we will develop a platform to utilize world’s pre-eminent
medical ICT using the universal healthcare system that Japan has been proud of.
Using vast amounts of medical treatment and examination data in a safe andeffective manner will contribute to the research and development of cutting-edge
drugs, treatment and medical device. In addition, using artificial intelligence forthese vast amounts of data could lead to the development of a system to support
treatment in the medical field.
As the shortage of human resources is an urgent issue in nursing care, it isnecessary to take more measures than ever for the progress of technologies that
support nursing care facilities such as robots, sensor, ICT, etc. ICT, etc. canreduce burdens of field workers. Furthermore, we will realize high-quality
nursing care services to support the independence of the elderly by making themost use of technologies such as robots, sensor, etc. to reduce burdens of field
workers and generate their motivation for new efforts. It is necessary to consider
this initiative as soon as possible in order to generate a virtuous cycle in whichthese efforts motivate workers toward innovation in the nursing care field.
Having the world’s highest longevity, the secret to good health in Japan is8

attracting a lot of attention from the rest of the world. It is expected that leading
the world in establishing new services that can respond to the fourth industrial
revolution will promote the development of overseas markets and contribute to
the partner country.
<Key policy measures>
1) Providing diagnosis support and innovative new drugs and medical
device by using Big Data, etc. (development of new platform in which
medical treatment and examination data is widely collected, managed
and de-identified in a safe manner)
2) Providing personalized healthcare services using IoT, etc. (putting
together, analyzing and utilizing health insurance claims, medical
checkup and health data), promoting the use of uninsured services forhealth and prevention.
3) Improving the quality and productivity of nursing care by utilizing
technologies such as robot, sensor, etc. (examining feasibility ofproviding appropriate framework, including review of nursing-carebenefits, manpower allocation and facilities criteria)(3) Overcome environment-energy constraints and expand investments
We will overcome environmental energy constraints, which is a global issue,
using Japan’s cutting age technologies and expand investment in economic
growth.
Investment in energy efficiency has as much economic effects as theinvestment amount itself. In addition to energy conservation, reviewing
production process, etc. at the same time will strengthen competitiveness throughthe reduction of costs that exceed those of simple energy efficiency and theimprovement in the quality of products and services. As the focus of business isshifting to the provision of services using data, expanding the promotion of
investment in energy efficiency from manufacturing industry only to distribution
and service industries and small and medium-sized companies will promote theeconomic growth of Japan as a whole.
As for renewable energy, we will try to control burdens on citizens and strive
for the introduction as much as possible. Towards the goal of developing alarge-scale hydrogen supply chain by around 2030, we will promote the9popularization of fuel cell vehicles for the realization of a hydrogen-basedsociety.
Electricity retail market was fully liberalized in April this year and various
businesses have begun to enter the market. Moreover, a new business model isemerging, in which a comprehensive energy management is implemented byconnecting consumers’ battery and solar power-operated facilities via a network
to control them in an integrated manner and combining this with a new demand
management method of “demand response.” This is the fourth industrial
revolution in energy field. We need to take measures to obtain world’s markets
using our technological strength.
Development and securing stable supply of resources is the basis to support anation’s economic activities. It is necessary to take measures based on medium tolong-term point of view. Currently, investment in resource development has
stagnated due to the low resource price and a considerable gap between supply
and demand and the rise in resource prices are expected in the future. It isnecessary to put stable investment in resource development even under the low
resource prices in order to secure stable economic growth.

<Key policy measures>
1) Promotion of investment of distribution and service industries andsmall and medium-sized companies in energy efficiency
2) Promotion of introduction of renewable energy and development of
new energy systems (full popularization of fuel cell vehicles, realizationof a hydrogen-based society, and establishment of a “trading market forelectricity saved (negawatt)”)3) Strengthening of resource security(4) Changing sports to a growth industry
Sports have an intoxicating and affecting attractiveness. They are developing
remarkably as an industry in some parts of the world. Approaching 2020 Tokyo
Olympics and Paralympics Games, are sports in Japan generating suitableeconomic values as would be expected?
Being attractive means, sports have the power to pull in more customers in

10

business. How can we use the power of sports attracting people, rather than being
the object just for watching? From the viewpoint of marketing, sports can betransformed to a growth industry in Japan.
Gathering people in the community is the key words for community
revitalization. Revitalizing a community based on sports is one powerful idea.
Where should a stadium/arena be located and where should people inside andoutside the community be gathered in the area? When there is a game, rather thanending up with just a one-time sport watching, based on sports, what kind of
integrated entertainment and memorable events can be offered in the “space” –including the surrounding area? It is necessary to have a viewpoint of community
development and shift from “consumption of goods” to “consumption ofexperiences.”
In order to realize this, we will take measures to convert the attractiveness ofJapan’s sports to economic values, such as the provision of support for offering
new watching style and sports experience by publishing media, using the latest
digital technologies, etc., and the development of new markets by integration ofsports with other businesses such as healthcare, food, medical care, tourism,fashion, culture and arts. Development of human resources that support thecreation of these new markets is also an important issue.
Athletes come first even when considering sports as an industry. Using the
economic values created by athletes and players for the improvement of gameenvironment and the introduction of latest training methods will increase gamelevels and the competitiveness of Japan’s sports as a global brand. At the sametime, these will lead to the personal fulfillment of each athlete during their life asa player and after retirement. This will eventually lead to the creation of anothernew economic value and the future development of sports in Japan. Establishmentof a virtuous cycle of sports in this way is the goal to be achieved.
<Key policy measures>1) Improvement the attractiveness and profitability of sports facilities
2) Development and use of sports management human resources andcreation of a platform
3) Integration of sports with IT, healthcare, tourism, fashion, culture andarts, etc. and its expansion11

(5) Revitalizing markets for transaction of existing houses and reform
Revitalization of the housing market could contribute greatly to economic
growth from the viewpoints of both demand stimulation and expansion of
housing-related investment.
A house can often be the most expensive purchase in one’s life. Nevertheless,people think that “purchase is the goal about a house” and the asset value of thehouse they purchased may decrease over time if no care was taken. In fact, it issaid that if a house is made of wood, the asset value will be zero in about 20 to 25
years after construction. Is this evaluation actually true?
Some people may think that they would like to live in the same house for along time and pass it on to their children and grandchildren, while others may
want to receive a loan for living expenses using the house as security. Some may
want to move from a house according to the stage of life. Different people have a
different set of values. In addition to the revitalization of new housing markets, itis necessary to develop a market of existing houses whose value can be increased
and which can be evaluated as an asset by living with care and providing
appropriate reforms.
The Fourth Industrial Revolution is happening in the housing industry. We
should provide new lifestyle and health, security service, etc. using newtechnologies including IoT in the next generation houses. It is considered that thedevelopment of the housing market including the provision of these new added
values will further increase the asset value of houses.
Increasing the asset value of houses has great ripple effects that can change theconsumption behavior in Japan: raised consumption as a result of resolving
people’s concerns about their old age. We need to take aforementioned measuresbearing these in mind.
<Key policy measure>
Establishment of an existing housing transaction market in which houses areevaluated as assets.
1-2: Enhancement of Local Abenomics

12(6) Productivity improvement of service industry
Roughly 70 percent of Japan’s GDP is made up by the service industry. Most
local employment is provided by the same sector as well. Therefore,
improvement of the service industry’s productivity is indispensable for people
to really feel economic growth and vitality of the community.
A huge productivity gap exists among companies in the service industry, andquite different services are provided by different types of business. The
service industry is also characterized by the fact that an overwhelming
majority of the businesses are community-based, making it difficult formeasures to spread among them. Given such reality of the service industry,
political approaches which are not standardized but made from a variety ofperspectives are required, which need to be carefully implemented to promote
productivity improvement of the service industry. In fact, the Headquarters forJapan's Economic Revitalization already adopted the “Service Industry
Challenge Program” in April last year and has launched cross-industrial,
industry-based, and community-based initiatives for productivity
improvement. By strengthening such efforts, the Government will form the“momentum for the service industry’s productivity improvement at a national
level.”The Government will also work to create growing companies which leadproductivity improvement of the service industry, the principal driver oftoday’s economy. As the fourth industrial revolution unfolds, added value in
manufacturing and simple services will be less important, making it crucial toshift into provision of data-driven services. While having willing businessowners understand such trend of the times, the Government will strive to help
create 10,000 companies whose productivities grow around 10% across thecountry by 2020 by assisting promotion of advanced utilization of data and IT.
For instance, the hotel business is a typical service industry trade. There, at anindividual hotel level, various new ideas are spurring the creation of newservices, one, for example, involving the utilization of data and tablet
computers through which a wide variety of requests from individual guests
are shared by the entire hotel staff, and appropriately dealt with. Suchinnovation not only helps increase repeat guests but also spreads the hotel’s
reputation through the internet thereby contributing to development of new13

customers. In addition to such efforts, what is also important is improvementof local attraction. It is necessary to spread among local businesses the ideathat a sustainable growth model can only be achieved by the combination ofcustomer attraction abilities enhanced through local attraction, and individual
businesses’ efforts for productivity improvement.
It is also important to take into account the characteristics of each industry
and closely work with trade associations by industry when promoting
productivity improvement. In fact, service industry’s efforts to adopt “Kaizen
on-site process improvement activities” and other superior knowhow ofmanufacturing industry which excels at productivity are already underway.
The Government will make effort to promote the spread of advanced businessmodels and methods to standardize operation flows obtained by suchactivities by including them in sector-by-sector guidelines (policies to workon in each industry towards productivity improvement) to be developed inaccordance with the SMEs Business Enhancement Act .etc.(passed on May 24,2016), working together with relevant organizations including tradeassociations by industry, and utilizing the measures for SMEs.
Local on-site efforts for the service industry’s productivity improvement arealso in full swing. In some advanced regions, a council has been establishedwhere local governments, small business associations, local financial
institutions, and other interested parties get together to share model cases forthe service industry’s productivity improvement and discuss the division ofroles in individual cases and assignment of support staff specialized in IT andother areas on a continual basis. The Government will help combine suchactivities with local branding approaches concerning revitalization of towns,
people, and jobs, thereby encouraging communities to make efforts in a way
to improve local attraction and individual businesses’ productivities together.
<Key policy measures>
1) Creation of businesses leading the service industry’s productivity
improvement
2) Productivity improvement by each business field
3) Community-based productivity improvement through utilization of
SME support providers, etc.

14(7) Renovation of mid-ranking companies, SMEs and microenterprises
Major players of local economy are mid-ranking companies, SMEs andmicroenterprises. But such local businesses are also subject to a wave ofchange. As population declines and business owners themselves get older,regional economy and society are coming under threat of discontinuation.
While dealing with such change, how should businesses maximize and takeadvantage of their potential? It is important that this challenge of businesses
needs to be supported in their communities.
TPP (Trans-Pacific Partnership) will bring a huge opportunity for local
companies to do business outside Japan. By providing thorough support for
the endeavor of core enterprises leading local economy and willing SMEs, theGovernment can expect their rapid growth.
Amid a labor shortage, SMEs and microenterprises are facing a significant
challenge, that is, productivity improvement including promotion of IT
utilization. By cooperating with SME support providers in communities, theGovernment will carefully provide cases of IT utilizations to business owners
in hope to make them more interested in IT utilization while promoting IT
investment and labor-saving investment according to individual businessconditions.
In addition, the Government needs to make sure that a positive economic
growth cycle will expand to SMEs and microenterprises across the country bypushing for improvement of the terms and conditions for subcontractors,
promoting local financial institutions’ financing by business assessment, andfacilitating business revitalization/ succession.
<Key policy measures>
1) Support for the growth of local core companies with an eye to theglobal market2) Support for local SMEs’ expansion to overseas by taking advantage of
TPP.
3) Support for improvement of productivity of mid-ranking companies,
SMEs and microenterprises including IT utilization
4) Promotion of provision of growth funds which do not need collateralor a surety by using a “local benchmark,” etc., enhancement of15

financing functions, and acceleration of business revitalization/
succession(8) Promote proactive agriculture, forestry and fishery, as well as reinforce
export“Increase the income of earnest farmers in local communities.” This is the key
phrase for agricultural reforms in the second stage of Abenomics. The
Government will expand the production scale, through promoting
concentration and consolidation of farmland, and increase sales while
making sure that production costs and intermediary margins are reduced to theminimum, making the foundation for farmers’ foray into new markets, both
domestic and international. The Government will accelerate initiatives likethese to establish agriculture as a robust “industry.”
Creating an enormous market of 800 million people, TPP is a great
opportunity for the agriculture, forestry and fisheries. The Government will
strengthen promotion of Japanese food, which is tasty, safe, and appreciatedworldwide, as well as strive to develop and expand sales channels by taking
advantage of growing overseas demand.
It is important to realize sustainable agricultural structures with a goodbalance between generations. In this sense, the Government needs to find thebest way to make agriculture more attractive “occupation” for the young
and females. Intuition and experience are assets. But those kept inside a single
farmer are useless possessions, which will sooner or later be lost. That is why
we need to passed those assets down to the next generation including theyoung and females. For this purpose, it is important to visualize know-how aswell as push forward with introduction of IT and automation to agriculture as
far as possible so that the young and females who are using smartphones andtablet computers on a daily basis could acquire skills efficiently.
During the Public-Private Dialogue towards Investment for the Future, heldon March 4, this year, both of the agricultural and business communities
announced the resolve to cooperate with each other and provide support toearnest farmers at the local level all the way up to the national level, and theGovernment confirmed the establishment of a system for cooperation.
Development of talent including management abilities, cost reduction to a16

bare minimum, exportation, introduction of IT and automation, and manyother challenges lie ahead, which cannot be immediately overcome byfarmers alone. The Government will solidify partnership with the agriculturaland business communities, as well as make concrete efforts to solve them.
<Key policy measures>
1) Enhancement of functions of the Public Corporations for Farmland
Consolidation to Core Farmers through Renting and Subleasing(Farmland Banks)
2) Cost reduction of production materials and realization of distribution/
processing structures favorable to producers3) Development of human resources
4) Reinforcement of export
5) Promotion of “smart agriculture” (realizing unmanned automatic
operation by remote monitoring by 2020)
6) Building a system for cooperation between the agricultural andbusiness communities(9) Tourism oriented country
The annual number of foreign visitors to Japan last year reached 19.74 million
with their consumption reaching 3.4771 trillion yen. These numbers havemore than doubled and tripled respectively in the past three years. Tourism isthe ace in the hole for “revitalizing regional economy,” and a pillar of the
Growth Strategy aiming to achieve GDP of 600 trillion yen. To achieve newgoals of 40 million foreign visitors to Japan with their consumption reaching
8 trillion yen in 2020, the Government will accelerate the trend and set
tourism as one of the key industries of Japan.
While boldly opening appealing governmental facilities such as the State
Guest House which has been opened to the public for visiting only on limited
occasions, the Government will utilize cultural assets and national parks as
tourism resources and push forward with developing of appealing tourism
areas. Increase in the use of facilities will lead to higher economic returns,
which will be used for the facilities as self-generated funding. Meaningful
tourism appeal can only be realized when each tourism area and facility
makes efforts as an independent tourism management. In that regard, what is
important is development of a consensus building process. Developing

17

appealing tourism areas requires answering questions such as what tourists
want in their destinations and what they want to see and experience,sometimes by using external human resources. To this end, the Government
will promote establishing and developing Japanese version of DMOs* acrossthe country, which are organizations specialized in strategically promoting
integral marketing and branding of tourism areas.
*DMO: Abbreviation of Destination Management/Marketing Organization.
It is a locally-owned promotion organization to develop tourism
area, through various activities such as creation of integrated brandof the area by combining various resources of the area, information
dissemination and promotion using website and SNS and others,
effective marketing, strategy formulation, etc.
To set tourism as one of the key industries of Japan, the Government willrevise old tourism-related regulations and systems while making efforts indeveloping human resources to support the tourism industry. For instance, theGovernment will start full-scale human resources development, which will
target a wide range of people including managerial talent for top positions,those who will lead development of local tourism areas thereby playing acentral role of local tourism, and more practical human resources for places
ready for business.
To prevent all these new goals from becoming empty wishes, the Government
also needs to accelerate improvement of the tourism environment to accept
foreign visitors, including accommodation facilities, Customs, Immigration,and Quarantine (CIQ), transportation, communications, etc. While pushing forenvironmental improvement on a national basis, the Government needs toprovide measures on a local basis as well to deal with expected local tourism
demand by figuring out what are issues to be solved and by when they need to
be dealt with.
Stimulating domestic tourism demand is also a significant challenge. Seasonal
concentration of tourism demand in the year-end and New Year holidays, theGolden Week, and the Bon holidays works against all players including
businesses, workers, and tourists. Peak times see a massive influx of visitors,
but in other times, operation rates drop sharply. Given that, it isunderstandable, in a sense, that businesses are not willing to makepromotional activities. From workers’ perspectives, tourism does not provide

18

an attractive work place because they tend to be hired on a part-time basis andonly at peak times. For tourists, no matter where they go, there are crowds ofpeople and everything is expensive, naturally making them less satisfied andless willing to go on a next trip. Smoothing out tourism demand fluctuations
is a huge challenge toward the realization of Japan as a tourism-oriented
country.
<Key policy measures>
1) Enhancement of the attractiveness of tourism resources (opening theState Guest House to the public, utilizing of cultural assets andnational parks)
2) Revision of tourism-related regulations and systems (expanding
guide-interpreter services, etc.)
3) Promotion of establishing and developing Destination
Management/Marketing Organizations (DMOs)
4) Development of tourism human resources5) Improvement of regional tourism environment to accept an increasing
number of foreign visitors to Japan
6) Promotion of taking leaves/ staggered holidays
1-3: Stimulation of domestic consumer confidence(10) Measures to stimulate domestic consumer sentiment under thecooperation between the public and private sectors
To make achievement of 600 trillion yen GDP feasible, the Government will
deliberate measures to stimulate domestic consumer sentiment in addition topromotion of private investment.
It is pointless to try to bring forward consumption from the future to today.
Instead, it is crucial for the public and private sectors as well as the central
and local governments to closely work together and provide “stimulation ofdomestic consumer sentiment” which will raise the consumption level tobalance the supply-demand gap in the country, make change to conventional
consumption/ purchasing behavior, thereby leading to creation of moreconsumption.
<Key policy measures>

19

Measures to stimulate domestic consumer sentiment
2. Regulatory and system reforms to realize revolution in productivity(1) Introduction of a new mechanism for regulatory reforms
The Abe administration has carried out “the greatest reform to the so-called
bed-rock regulations in the postwar period” in areas such as energy,
agriculture, and healthcare. It has achieved significant results in attracting
private investment, and is placed in the “‘10 strategic public-private joint
projects’ towards GDP of 600 trillion yen” in the 2016 Japan Revitalization
Strategy.
There is no end to reforms by the Abe administration.
In light of imminent changes of the time caused by the fourth industrial
revolution, it is necessary to introduce a new mechanism for regulatory
reforms. In the era of the fourth industrial revolution, predicting technologicalinnovation becomes harder and speed is highly valued. If you are a touch late,
you will be out of the game. It is such an unpredictable time that theGovernment needs to pursue an approach where the public and private sectors
will share a vision and develop a road map by working backward from thefuture image, based on which companies will develop technology and businessmodels while the Government will implement regulatory reforms. Thisapproach also requires such flexibility that the public and private sectors sharea gap with expectations, if any, and immediately modify their respective
actions.
In addition to reforms to bed-rock regulations in individual fields, theGovernment aims to realize “the world’s most business-friendly country” andwill introduce new methods for reforms which enable it to promote
deregulation, simplification of administrative procedures, and introduction of
IT in an integral manner in order to give a boost to companies’ productivity
improvement efforts towards realization of “economy of 600 trillion yen
GDP.”<Key policy measures>
1) Introduction of a method to implement concrete reform measures20

developed by backcasting from medium-term goals set up based on
the prospects of the industrial revolution (“Road map method for theback calculation of goals”)
2) Introduction of a new method for regulatory reforms to promote
deregulation from the perspective of business operators, simplificationof administrative procedures, and utilization of IT in an integral
manner.
(2) Utilization of National Strategic Special Zones (Breakthrough on
structural reforms)
With regard to National Strategic Special Zones, the Government will develop
the world’s most business-friendly environment, where the private sectors
could leverage their capabilities, for economic growth by designating the twoyear period until the end of FY2017 as a “concentrated reform enhancement
period,” and setting up “new goals” of implementing the following measures.
The Government will make a breakthrough on remaining “bed-rockregulations,” designate six fields to focus on, and further accelerate its efforts
for addition of necessary designated zones and “visualization” of specificprojects, in addition to increasing and exploring regulatory reform matters.
The Government will deal with each specific need in a comprehensive mannerat any time, and further enhance “gateway” functions to provide support forrealization of any business.

(3) Regulatory reform towards future investmenta) Further enhancement of corporate governanceCorporate governance reform is the top priority issue for the Growth Strategy,
and its important position has not changed. Now that a growing market has
surfaced, making a 600 trillion yen economy achievable, and that the fourthindustrial revolution has brought the age of rapid change, “growth-oriented
management” has become indispensable. It is also required to improve theeffectiveness of “constructive dialogue between businesses and investors.” All
the interested parties need to recognize that there is no magic wand to solve all
the problems, and keep various efforts going.
To develop corporate governance reforms from mere “formalities” to21

“substance,” it is useful to increase the effectiveness of institutional investors’
influence on listed companies. For this purpose, the Government will promote
investors to have dialogue which gives “awareness” to companies. Coupledwith this, the Government will support efforts by listed companies for
improvement of the effectiveness of corporate governance through learning andpublicizing the state of listed companies’ efforts concerning the CEO selection
and dismissal process and composition, operation, and evaluation of the boardof directors.
In addition, as a foundation to support such efforts, the Government will firmly
carry on its initiatives for improvement of the effectiveness and efficiency ofcompanies’ disclosures and electronification of the processes for shareholders’meetings. With regard to companies’ disclosure, the Government will aim for
improvement of environment for realization of the world’s most effective andefficient disclosure, and reasonable scheduling of shareholders’ meetings andthe Record Date, roughly by the first half of 2019, based on the past discussion,from the perspective of promoting dialogue between companies and investors
included in the “Stewardship Code.”
Investment now in need is that to support efforts of companies, which made thehighest corporate earnings in history, to open Japan’s economic frontiers.
<Key policy measures>1) Improvement of the effectiveness and efficiency of corporate
disclosure which provides a basis for constructive dialogue between
companies and investors2) Electronification of the processes for shareholders’ meetingsb) Smooth supply of growth funds through realization of vibrant financial/
capital markets
To realize better flow of funds and promote portfolio rebalance to facilitate
people’s stable asset formation, the Government will promote NISA and Junior
NISA programs, improve their systems, and enhance financial and investment
education as a measure related to household assets while enforcing observanceof fiduciary duties to ensure that financial institutions give priority to benefitsof customers (households), and conduct business for benefits of customers andbeneficiaries through appropriate management of conflict of interest andadvanced asset management.

22

In addition, financial institutions are expected to ensure sound operation andprovide high-quality financial intermediation functions, that is providing
sufficient financial intermediation functions when the economy or the market isstrained, and contributing to industry/ business solutions through financing
based on business assessment and supporting core business.
With regard to FinTech, based on the perspective of user protection and fraud
prevention, the Government will aim to advance financial services by
incorporating IT development in the finance sector, and discuss institutional
issues in order to improve user convenience and strengthen Japan’s economic
growth potential while creating environment (FinTech ecosystems) to ensure
development of FinTech.
As well, to deploy big data for providing attractive tours, further stimulating
inbound demand, and discussing political use of “Regional Economy Society
Analyzing System (RESAS),” the Government will push for improvement ofenvironment to make use of big data obtained through cashless settlement.
<Key policy measures>
1) Promotion of portfolio rebalance contributing to provision of growthfunds and improvement of market environment (promoting NISA,
enforcing fiduciary duties, developing tools for long-term stable
investment, securing fairness, transparency, and stability of markets,
etc.)2) Provision of high-quality financial intermediation functions(strengthening efforts for financing by business assessment andsupporting core business)
3) Promotion of FinTech (creating FinTech ecosystems, etc.)
4) Utilization of big data (standardizing data obtained through credit cardtransactions)c) Expansion of private participation in public services/ assets through
PPP/PFIAs part of structural reforms, opening up of public services/ assets to theprivate sectors will lead to efficient provision of high-quality services
leveraging originality and ingenuity of businesses, and could trigger more

23

private investment.
It realizes creation of new business opportunities, upgraded service to citizens
based on the private sector’s wisdom, and reduction of public spending due tobetter efficiency, in other words, "kills three birds with one stone."
With regard to facilities expected to see growth in demand due to the increaseof tourists from inside and outside Japan, including airports, educational
facilities (sports facilities, social educational facilities, and cultural facilities),
passenger terminal facilities for cruise ships, and MICE facilities, it is expectedthat improved service will further increase visitors and that funds realized
through better efficiency will produce a synergy by being invested in othergrowth areas.
As for facilities expected to see decrease in demand due to declining
population, such as toll roads, water supply and drainage operations, and public
housing, perspectives for “growth” are also required, for example, considering
new business development such as overseas operation or creation of newservices using facilities, in addition to improvement of asset management by
utilizing the private sector’s knowhow.
The Government needs to aggressively promote PPP/PFI, including PFI
concession projects.
<Key policy measures>
Expansion of private participation in public services/ assets through
PPP/PFI
3. Creation of innovation/ development of human resources full of fight(1) Strengthening creation of innovation, startup companies
It is finally time to “take action” towards realization of university and National
R&D Institute reforms.
As the fourth industrial revolution has begun, open innovation is gathering
momentum more than ever before. Technological innovation is so difficult topredict that the question of who you work with is becoming increasingly

24important in management decisions. There are high expectations and great
responsibilities on universities and National R&D Institutes. It is not too muchto say that realization of an economy of 600 trillion yen GDP rests on whether
universities and National R&D Institutes can really be reborn.
Why haven’t we seen big progress in industry-academia collaboration so far?
That is not a problem concerning universities and National R&D Institutes
alone. How can heads of universities and National R&D Institutes andcompanies build a win-win relationship in their respective management
strategies? The perspective needed to answer this question is exactly what isneeded when thinking about industry-academia collaboration to be achieved: it
is not collaboration between individual researchers and research departments ofcompanies but full-scale partnership.
Of particular note is that the key to victory in the fourth industrial revolution isthe area related to artificial intelligence. As the competition increasingly takes
the form of war of real data in places where Japan holds advantage including
manufacturing, Japan still stands a chance of winning. How should Japanleverage its technical advantage over AI-related technology and real businessfields and grapple with the fourth industrial revolution? The next few years will
be decisive. There will be no bright future for Japan if the country fails toeliminate vertical divisions of academia, industry, and government and work
hard. The country’s fate rests on whether it can keep such a sense of crisis.
The fourth industrial revolution also heralds the era of startup companies. It is
nothing else but startups which can take on a bold challenge in a speedy
manner with agile decision making capabilities that should play a central role
in realizing an economy of 600 trillion yen GDP. While local startups make aforay into the global market, large corporations are enthusiastically looking forpromising startups as partners for their open innovation. Time is ripe for theadvent of world-class startup companies.
<Key policy measures>
1) Organization-to-organization full-scale industry-academia
collaboration (tripling investment from companies to universities
National R&D Institutes and etc.; establishing five world leading
research bases staffed with top researchers from Japan and overseas,
by FY2025)25

2) Fleshing out strategies for research and development andindustrialization in the “The Artificial Intelligence Technology Strategy
Council”
3) Development of “Platform Bridging Between Provincial cities and theWorld”(2) Developing and securing human resources to lead economic growth
The Government will get down to developing and securing of human resources
capable of supporting the fourth industrial revolution seriously.
It is “people” that create added value from utilizing data. As the technologies
related to artificial intelligence, etc. advance, the details of work and the way
people work are expected to change dramatically. But, after all, “people” arethe ones that come up with business models which produce added value. And
such talent is not easy to come by. As investment in future, it is important todevelop educational systems of each stage such as education in elementary
school, junior-high school, and high school, all the way up to human resources
training for world-class talent by reading trends of the time from short-term,
medium-term, and long-term perspectives.
The fourth industrial revolution brings along various changes to the field of
education as well. The Government will need to establish a way of teachingthat meets today’s needs by striking the right balance between respecting
traditional teaching and introducing new measures using tablet computers andother IT tools.
Development of human resources and establishment of an education method
which are appropriate for today’s needs cannot be fully realized by educational
circles alone. It is important to develop a system which provides updated
information on what kind of talent is in demand in the real world of business,
and what kind of educational methods could be available based on the latest
technology.
To generate innovative ideas, diversity in human resources is indispensable.
People with various backgrounds, experience, and views get together andstimulate with each other, which will lead to innovative inspiration. Countries
will be increasingly vying for excellent talent. In that regard, Japan needs to26

invite excellent foreign human resources and have them contribute to thecountry’s economic growth over a long period of time. To this end, theGovernment needs to develop environment to accept such talent, otherwise,
Japan will be left behind in the race.
<Key policy measures>
1) Development of and training measures for human resources who will
support the fourth industrial revolution2) Holding the “Council for Promoting Human Resource Development to
respond to the Fourth Industrial Revolution”
3) Introduction of “Japanese Green Card for Highly Skilled Foreign
Professionals” which is the fastest such system in the world(3) Improving employment environment and promoting participation ofvarious workers to overcome growth restrictions
For achieving an economy of 600 trillion yen GDP, declining population
presents an unavoidable challenge. The Government needs to take measures toincrease the birth rate as soon as possible. It is interesting to know that if ahusband does not help with housework or childcare when a first child was born,
his marriage is very unlikely to have a second baby. In this regard, what is
important is a reform to how men work.
Working style reforms contribute to productivity improvement as well. Free
time realized by working style reforms can be used for self-study, or spent withfamily, which will relax one’s mind. This is how working style reforms willcontribute to the “quality” of work.
Promotion of women’s participation in society is a pillar of the Abeadministration, and it should not be considered as an easy solution to securinglabor. Women’s participation will bring along a variety of values to theeconomy and society, and will contribute to creation of innovation. Women’s
further involvement is indispensable for the Government’s effort for structuralreforms in the economy and society, and therefore, the Government will go all
out to overcome problems hindering women’s participation such as children on
nursery school waiting lists.
Resources held by the elderly, namely, knowledge, experience, business27

knowhow, and personal connections, are too valuable to be missed out on interms of both economy and development of next generation of humanresources. So, the Government should let seniors who want to work as long as
possible. By preparing social environment to make that possible, theGovernment can grant their wish and also expect them to live a spirituallyfuller life. Therefore, promotion of seniors’ social participation continues to be
an important agenda as well.
<Key policy measures>
1) Enhancement of efforts to remedy long working hours
2) Promotion of further social participation of women and elderly persons

4. Taking in overseas growing markets
The TPP signed in February 2016 will bring about great opportunities to take inhuge growing markets of 800 million people in Asia and the Pacific, which
account for approximately 40% of the world’s GDP. The government will makeall-out efforts to support for expanding business of small and medium-sizedcompanies to overseas markets, through utilizing experts aquainted with overseas
business to provide comprehensive support in developing their business strategies,
helping their access to local human resources, and cultivating their sales channels.
In addition, the government will push forward to achieve early entry into forceof the TPP and expand its member countries/regions, and strategically and
expeditiously promote negotiations on other economic partnerships, including theJapan-EU EPA, Regional Comprehensive Economic Partnership (RCEP), andJapan-China-Republic of Korea FTA. Playing central roles in building suchwide-area new economic order, Japan aims to take the lead in establishingcomprehensive, balanced and high-level global rules. Japan will also accelerate
its efforts for concluding/amending investment agreements and tax treaties,
intending to provide appropriate business environment for Japanese companies toexpand their business overseas.
Demand for infrastructures is increasing on the global scale. Competition fordrawing on its demand is also getting fiercer. To meet infrastructure demand in
Asia and other regions, it is important for the government to further intensify
ongoing public-private cooperative efforts. In addition, in accordance with the28

“Expanded Partnership for Quality Infrastructure”, it is also important for thegovernment to increase the supply of financial resources towards infrastructure
projects including natural resources across the world, aiming to achieve
approximately $200 billion for the next five years, as well as to improve further
relevant measures and to strengthen the institutional capacity and financial
grounds of Japan’s relevant organizations including JICA, JBIC, NEXI and
JOGMEC. In order to differentiate the strategy from our competitor nations, thegovernment will take government-wide effective measures, not only providing
financial support but also conducting strategic public relations activities,
promoting the importance of quality infrastructure investment in the process ofdeveloping relevant international standards and providing effective supports inline with the needs of partner countries such as developing local humanresources.
Taking opportunities afforded by the TPP, the government intends to increase
more inward foreign direct investment, aiming to serve as trade/investment global
hub. Many nations are facing fiercer competitions to attract foreign investors. It isnecessary to formulate policies to attract foreign companies’ attentions to Japan,
working with local governments to steadily call attentions to Japan’s
advantageous points and local strengths. It is also necessary to further enhance
initiatives to provide more friendly business and living environment for foreigncompanies and foreign nationals.
<Key policy measures>
1) Promoting economic partnership negotiations and concluding/amending
investment agreements and tax treaties
2) Supporting small and medium-sized companies expanding their businessoverseas, drawing on opportunities afforded by TPP
3) Increasing infrastructure exports
4) Promoting inward foreign direct investment

5. Utilizing reform momentums (Pushing ahead with “Reform 2020”
projects)
In 2020, Japan will host Tokyo Olympic and Paralympic Games. The nation
will attract world-wide attentions, leading to a lot of foreign tourists visiting
Japan. Setting the year 2020 as a goal and pushing ahead with reforms and29

innovations to showcase Japan will create significant momentum.
To this end, we will showcase Japan’s highly competitive technologies, while
paying due attentions to yielding legacies that will last even after 2020. We intend
to open the way for Japan and for the world by implementing our future-looking
projects toward 2020, such as: Taking care of automatic driving solutions wheredevelopers are competing one another to establish new business models on theworld-wide scale; solving environment/energy problems that represent theworld’s common agenda; and utilizing state-of-the-art robots that will contributeto a wide variety of problems, including population decrease and aging society.
<Key policy measures>“Reform 2020” projects (Automatic driving technologies, distributed energy
resources, state-of-the-art robots, etc.)30

III. Future Initiatives to Realize Further Growth(Intensifying PDCA cycle through KPI review)As the second stage of our growth strategy, the growth strategy presented here
aims at further reform in the three topics: “Productivity Revolution,” “promisingmarkets” and “human resources enhancement.” We have been setting out KPIs forour growth strategies to date. In line with our growth strategy’s second stage, wehave reorganized/reset KPIs for each policy category, set out new KPIs for new
areas and have made upward adjustment if KPI is likely to improve further.
Resetting KPIs in itself is not a purpose, but is an approach to push ahead with
our policy actions. If thorough KPI review has revealed any unsatisfactory
outcome, it is important to steadily operate the PDCA cycle, such as intensifying
validation/evaluation tasks to identify why it is not so successful, which
additional policy action is necessary for attaining the target or whether KPI
should be reviewed or not.
In this process, rather than putting focus on listing up the reasons why KPI
does not go steadily to attain the target, it is necessary to correlate problems in the
C (check) stage with the A (action) stage. This is the most important role of KPI
review. As several policy actions or government ministries/agencies are involved
with policy actions with KPIs, it is necessary to make a study with them. In
addition, Industrial Competitiveness Council should play a leading role in thisprocess.
(Addressing the Fourth Industrial Revolution)“Public-Private Council for the Fourth Industrial Revolution,” a new unit underthe Headquarters for Japan's Economic Revitalization, will work with related
government councils to examine feasibility of new strategies in highly
competitive and high-priority sectors that draw on Japan’s strengths and possible
government-wide policy actions, such as innovation- or human resources
development-related policies.
In terms of our high-priority areas, as business creation competition is getting
stiffer in the world, it is important to make efforts for turning each of new
business opportunities into actual business. While suggesting future solutions
both for the private and public sectors based on feasibility of new businessmodels at home and abroad, we will simultaneously take policy actions andregulation/system reforms necessary for putting these business models into
practice. In addition, the government will also strive to reduce costs related with31

regulations and administrative procedures, aiming to become “the most businessfriendly nation in the world.”
All-out efforts will start in the near future in terms of innovation and humanresources development, which serve as cross-sectional policy action that support
the Fourth Industrial Revolution.
Our national university reform and national R&D agency reform projects will
be put into practice in the immediate future. In artificial intelligence-related sector
that serves important roles in the Fourth Industrial Revolution, we will pushahead with specific strategies and actions, while widely watching Japan’s
technical strengths and overseas trends. Each university or national R&D agency
will work on their visible specific projects based on their strengths, including
making judgment on what it should aim at, who it should work with, and what itshould do.
In human resources development, new projects will start to examine possible
skills and tasks necessary for business purposes in the Fourth Industrial
Revolution era. By clearly identifying necessary skills and tasks as much as
possible and working with the industrial circle, human resources developers andeducation-related staff to discuss which program or what teaching method is themost effective, it is necessary to put these inputs into actual actions.
As more and more Japanese workers will have a mindset “taking a job,” rather
than “serving for a company” for their entire life, our way of working is also
anticipated to change significantly. Because people with a wide variety of ideas
and backgrounds get together and have discussions, which will lead toinspirations and create innovative business models, we will see increased need tomake Japan a nation that attracts innovative human resources from the world. We
need to further examine how our way of working for individual workers willchange, how labor outcome should be appropriately evaluated, and what weshould do to attract more overseas high-quality human resources to Japan.
(Conducting and putting into practice “10 strategic public-private joint projects”)
In the growth strategy herein, structural reform outcomes to date from
Abenomics are clearly described as new “promising market,” which will attract
more human resources, goods and money. In this context, the growth strategy
suggests “10 strategic public-private joint projects” because the government willfurther improve productivity under friendly competition and decisively address
systematic problems that come to the surface.

32

We should not end in mere sloganeering. In particular, we will have close contacts
with the economic circle to identify content of each project and put them into
actual practice on site. The public sector will provide appropriate environment,such as regulatory reforms, while the private sector will make innovation
investment through “growth-oriented business management.” Literally, theprivate and public sectors must both make their all-out efforts to implement andput into practice each of these projects. It is important to employ KPI review andsome other approaches to closely check out how these projects are progressing.
(Challenges in Abenomics’ 2nd stage)
We can afford no further delay in achieving “GDP 600 trillion yen economy.” Itis necessary to push ahead with the following actions in an integrated manner:
Working on structural reform that serve as core policy, creating/fostering growthmarket and new business models surrounding the structural reform, and creating
innovations and fostering human resources that will serve as the foundation of
growth.
To cope with the era of reform, open the way for Japan’s future, and hand off
brilliant future to the next generation, now is the time for all Japan stakeholders ingovernment-industry-academia collaboration to take specific actions quickly. This
represents our challenges in Abenomics’ 2nd stage.

33

IV. Principal Policy Measures of Japan Revitalization Strategy 2016
With regard to Japan Revitalization Strategy 2016, as shown in thefollowing chapter, the government has reviewed how much the last year’s“Japan Revitalization Strategy Amendment 2015” has progressed, flexibly
reexamined specific policy actions, and expressed appropriate policy to betaken in the future by adding new specific policy actions to be taken andrevising the entire roadmap.
Following are the measures which have been selected, based on thediscussions in the Industrial Competitiveness Council, from the viewpoint of
the fundamental idea of the Japan Revitalization Strategy 2016. (Note: The
following sections show examples of policy actions and do not indicate theirimportance or priority.)

1. “10 strategic public-private joint projects” toward GDP 600 trillion yen
1-1 Creating new promising growth markets(1) The Fourth Industrial Revolution (IoT, big data and artificial
intelligence)
1) Setting up “the Fourth Industrial Revolution Public-Private Council” thatserves as the overall control center・As the overall control center for the government-wide actions related with
the Fourth Industrial Revolution, the Fourth Industrial Revolution
Public-Private Council will be established under Headquarters for Japan's
Economic Revitalization in order to take control over the government’s
overall efforts.
[Set up the Council in this summer]
2) Creating specific R&D and industrialization strategies at “Artificial
Intelligence Technical Strategy Council”
・“Artificial Intelligence Technical Strategy Council,” set up this April as thecontrol center in charge of developing/implementing technical strategies
based on Japan’s strength under industry-government-academia
collaboration in artificial intelligence will develop artificial intelligence
R&D goals and industrialization roadmap forindustry-government-academia collaboration purposes and push ahead withvarious efforts in an integrated fashion, ranging from R&D and putting theminto practice.
[Prepare the roadmap within this fiscal year]343) Regulatory/systemic reforms (“goal-based inverse calculation roadmap
style,” “pushing ahead with regulatory reform, simplified administrative
procedures and IT dissemination in an integrated manner,” promoting
data-based projects beyond corporate/organizational boundaries, andproviding secure environment)
・After sharing future business images between the public and private sectors
with specific deadline, create an inverse calculation roadmap andintroduce new regulatory reform mechanism “roadmap approach” to carryout specific reform projects.
[Introduce the scheme from this summer onward]

・Strongly push ahead with the Fourth Industrial Revolution by actualizing
automatic driving solutions and smart factories, using small unmanned
aerial vehicle for industrial purposes, increasing smart industrial safety andpromoting Fintech and some other solutions.
[Automatic driving solutions: Create appropriate demonstration-purpose
schemes/infrastructures by 2017][Smart factories: Create at least 50 pioneering projects by 2020][Small unmanned aerial vehicle: Coordinate a rough direction of new system bythis summer][Industrial safety: Launch flexible regulations and demonstration projects toencourage IoT utilization within this fiscal year]
・Set up new conference and coordinate necessary policy actions towards sounddevelopment of the sharing economy.
[Coordinate by this autumn]
・Under the recognition that cyber security is not “cost” but “investment for the
future,” put more emphasis on growth industries, develop new humanresources development programs and examine appropriate important
infrastructures protection and review of action plans.
[Develop and announce human resources development program within this fiscal
year][Review action plans by the end of this fiscal year]
4) Promotion of business metabolism and streamlining of business
35

restructuring toward the fourth industrial revolution.
・Aiming at accelerating R&D, strategic investment and quick businessreorganization that bring about innovations, examine feasibility andnecessity of policy actions and take necessary actions, including
systemic approaches, with eye on legislative measures,and takenecessary actions.
[Draw conclusion within this year]5) Creating specific human resources development and education-related
programs at “Council for Promoting Human Resource Development to
respond to the Fourth Industrial Revolution”
・Hold the “Council for Promoting Human Resource Development to respond to
the Fourth Industrial Revolution” for the purpose of fostering humanresources who will sustain the Fourth Industrial Revolution, consider therequired skills and businesses, etc. with the attendance of people from therelevant government bodies, the industry and so on, and reflect them in thegovernment’s human resources and education policies.
[Hold by the end of this year]6) Expanding the Fourth Industrial Revolution to medium-sized and SMEs
・IT, Kaizen activity and robot technology experts will help medium-sized or
SMEs in collaboration with projects of SME associations.
[Provide support to at least 10,000 firms in the next 2 years]
・Aiming at accelerating spread-out of robots to medium-sized or SMEs, reduce atleast 20% of small-sized general-purpose robot price and installation cost andincrease two-fold human resources (15,000 persons to 30,000 persons) that
support robot-based system establishment/installation (system integrators).
[Achieve this goal by 2020](2) Toward a world leading healthcare country
1) Providing diagnosis support and innovative new drugs and medical device byutilizing Big Data, etc. (development of new platform in which medical
treatment and examination data is widely collected, managed andde-identified in a safe manner)
・Toward encouraging R&D on new drugs and medical treatment based on
information in medical sector or some other fields, examine feasibility of36

“Agency services (tentative name)” that widely collect medical treatment
and examination data, achieve new safe management and anonymous
framework and utilize them. In this process, examine appropriate framework
beneficial for medical staff and patients; for example, new framework thatutilizes massive data collected by “Agency services (tentative name)” and iscapable of providing evidence-based diagnosis support in the medical sector.
[Establish necessary legal framework within the next year]
2) Providing personalized healthcare services using IoT, etc. (putting together,analyzing and utilizing health insurance claims, medical checkup and healthdata) and promoting the use of uninsured services for health and prevention
・Aiming at providing “personalized health services” suitable to personal needs,
put together and analyze healthcare insurance claims, medical checkup orother health data held by the insurer or employers or available on a daily
basis from wearable devices by obtaining consent of the person in question
and launch a demonstration project that provides personalized healthcare
services. As for incentive reform to enhance preventive and health practices
provided by medical insurer, policymakers should design new scheme,
including the aforementioned efforts, to give incentives for ICT-based
preventive and health practices.
[Demonstration project will start within this fiscal year]3) Improving the quality and productivity of nursing-care by utilizing
technologies such as robot, sensor, etc. (examining feasibility of providing
appropriate framework, including review of nursing-care benefits,
manpower allocation and facilities criteria)
・ New demonstration project that collects/analyzes outcome data, such as
improved productivity on nursing-care services due to introduction of robots,etc., is scheduled to start this fiscal year. Based on such analytical result,examine, and draw conclusion on, feasibility of appropriate evaluation systemon robot-based nursing-care services. This includes review of nursing-carebenefits, manpower allocation or facilities criteria in a way to contribute to
reducing nursing-care service burdens, while paying attentions to viewpoints
of incentives that draw innovations or originality in nursing-care services. By
cutting in half document volume required by the government andanalyzing/standardizing service operations with ICT-based nursing-carerecords, encourage improvement in nursing-care operations and promote
appropriate services that contribute to elderly people’s self-support, aiming to37

improve productivity of nursing-care services and thereby reduce heavy
burden on nursing-care service staff.
[Examine and draw conclusion on stance on appropriate evaluation ofrobot-based nursing-care services in the next fiscal year](3) Overcoming environmental energy obstacles and expanding investment
1) Encouraging energy-saving investment in distribution/service sectors andat SMEs
・Expand the energy-saving industry top-runner program to
distribution/service sectors.
(Cover 70% of energy consumption of all industries by FY2018)
・In addition to energy reduction volume, reexamine feasibility of productivity
improvement support programs and Energy-Saving Act-based regulatory
framework, such as improving energy consumption rate, and enhancing
energy-saving efforts at the sector/supply chain level.
[Draw conclusion within this fiscal year]
・Aiming at encouraging residential energy-saving efforts, expand eligibilityof the top runner criteria to incandescent lamp and some other sectors inthis fiscal year. Increase the number of net zero energy houses to morethan a half of new custom-built houses of house builders, and send up
two-fold energy-saving renewal projects by 2020.
2) Encouraging introduction of renewable energies and establishing newenergy system (Achieving hydrogen society through full-scale diffusion offuel cell vehicles and creating “power-saving (negawatt) trading market”)
・Towards creating a hydrogen society, accelerate introduction of fuel cellvehicles and hydrogen stations.
[Fuel cell vehicles: Increase the number of fuel cell vehicles to some 40,000 by
2020 and to approximately 800,000 by 2030][Commercial hydrogen station: Increase the number of hydrogen stations tosome 160 by FY 2020 and to some 320 by FY2025]
・Aiming at encouraging new energy management business thatmanages/controls residential-use photovoltaic power generation systems
and batteries through IoT in an integrated manner and utilizes them inelectric power trading, create “power-saving (negawatt) trading market”
38

in which market players are able to sell the electric power that they
actually save. To this end, prepare trading rules for market players andcreate appropriate communications protocols for energy equipment
remote control.
[Creation of trading market: Within the next year; Creation ofcommunications protocols: Within this fiscal year]
3) Enhancing the resources security
・Actively support risk money supply, etc. through JOGMEC (Japan Oil, Gas andMetals National Corporation).
(4) Changing sports to a growth industry
1) Changing sports facilities to more attractive and enhancing their profitability
・Aiming at making stadiums and gymnastic halls more attractive and enhancing
their profitability, develop new guidelines on facilities development andoperational practices, regarding facilities access, their scale, ancillaryfacilities and services.
[Develop such guidelines in this fiscal year]
2) Creating new platform that fosters and utilizes sports business humanresources
・Aiming at improving the operational capabilities, profitability and governanceof sport-related organizations, examine and draw conclusion on feasibility ofcreating new platform that fosters professional and practical skills andprovides matching services for a wide variety of human resources
inside/outside the sports circle.
[Draw conclusion in this fiscal year]
3) Integration and expansion of sports with IT, healthcare, tourism, fashion,culture and arts, etc.
・Examine and draw conclusion on possible approaches that create new values for
sports via digital technologies (IT) and create/expand new sports market
through integration with other sectors, such as health industry.
[Draw conclusion in this fiscal year]39

(5) Revitalizing existing housing trading/renewal market〇Creating an existing housing trading market where houses are evaluated as an
asset
・Provide support to formation of new trading/financial schemes where existinghouses are appropriately evaluated as an asset, and create high-quality andattractive “Premium existing house (tentative name)” new registration
system.
[Create such scheme in this fiscal year]
1-2: Deepening local Abenomics(6) Improving productivity in the service industry
1) Creating pioneering firms that play leading roles in improving
productivity in the service industry
・By providing support to IT-based innovative service development efforts
through mobilizing all policy actions, including“Manufacturing/Commercial/Service New development Support Subsidy,”
create 10,000 new firms nationwide that enjoy 10% productivity growth rateby 2020.
[Create 10,000 new growth firms with 10% productivity growth rate by 2020]
2) Improving productivity of each operating sector
・Based on “SMEs Business Enhancement Act”(passed on May 24,2016), develop
new sector-by-sector guidelines for productivity improvement, such as 7
sectors (transport, medical, nursing-care, childcare, restaurant,
accommodation, wholesale and retail sectors) and provide support to IT
installation and corporate management guidance in line with characteristicsof the service industry.
[Develop new guideline as soon as possible]

3) Improving productivity at local level through utilizing SME support
organizations, etc.
・ Utilize Local Revitalization Promotion Subsidy, etc. to push ahead withestablishing regional councils or other opportunities that examine, conduct
and disseminate specific approaches to enhance competitive edge andproductivity of regional service sectors.

40

(7) Creating innovative medium-sized firms, SMEs and micro enterprises
1) Supporting growth of regional core firms looking to the world market
・Identify regional economy’s pioneering medium-sized firm candidates throughRegional Economy Society Analyzing System (RESAS), and intensively
provide support, such as planning their commercialization strategies for theworld market, conducting R&D with eye on possible sales channels, anddeveloping new overseas sales channels.
[Support some 1,000 innovative projects in 5 years, with the target of providing
aid to some 200 projects every year]2) Supporting regional SME’s overseas expansion in the wake of TPP
・Aiming at helping cultivation of massive markets in the wake of TPP, provide
comprehensive support to Japanese medium-sized firms and SMEs under“New Major Export Nation Consortium.”[Started operations this February]3) Supporting productivity improvement at medium-sized firms, SMEs and microenterprises through IT utilization
・Raise IT awareness among business owners by holding IT utilization counselingsessions, help at least 10,000 firms in the next two years by giving aid from IT,
Kaizen activity and robot technology experts, and push ahead with IT
investment and labor-saving investment in line with actual business practices,
ranging from micro enterprise’s online sales projects to SME’s data utilization
efforts.
4) Encouraging “local benchmark”-based growth fund supply not dependent oncollateral or personal guarantee, enhancing financial capabilities andaccelerating business revitalization or business succession
・ While utilizing “local benchmarks” developed this March as corporate
performance indicators, encourage growth fund supply to enterprises striving
for improving productivity without collaterals or personal guarantees bydeepening dialogues between enterprises and financial institutions/SME
support organizations.
・ Reexamine credit guarantee programs so that financial institutions andenterprises will both make further efforts to improve their businessperformance and productivity. In addition, examine necessary approaches tocreate effective business revitalization support programs, achieve smootherbusiness succession and encourage corporate management innovation in the41

wake of business succession.
(8) Promote proactive agriculture, forestry and fishery, as well as reinforce
export1) Enhancing capabilities of farmland intermediary management institutions
・Aiming at enhancing prefectural government’s incentives to utilize the said
institutions, create new scheme that gives preferential treatment toprefectures that show good performance in their farmland intermediarymanagement institutions.
[Introduce this scheme in budget allocation process after calculation of actual
performance]2) Reducing production materials cost and creating distribution/processing
structure beneficial to producers
・Aiming at increase income for farmers, put together specific policy actions inthis autumn, including new approach in which farmers are able to select andprocure production materials at a lower price, or other policy actions for new
distribution structure that provides a wide variety of options so that farmers
will be able to decide their buyers and selling prices under their own
responsibilities.
[Draw conclusion in this autumn]
3) Enhancing human resources capabilities
・Aiming at enhancing business management, technical and labor capabilities
that make up the overall human resources capabilities, coordinate specificpolicy actions to secure next-generation human resources and create
appropriate environment in which farmers will be able to learn new
knowhow.
4) Reinforcement of export
・Aiming at enhancing export capabilities in Japan’s agriculture, forestry andfisheries industry as well as drawing on the world’s food market mainly
growing in Asia for expanding sales channels for Japan’s agricultural/fisheryproducts or foods, provide support to strongly-motivated projects offarmers/fishers/foresters and cope with foreign regulations that the private
sector is unable to address on its own, based on “Agriculture, Forestry and
Fisheries Industry’s Export Capability Enhancement Strategy” (coordinatedby Agriculture, Forestry and Fisheries Industry and Regional Revitalization
42

Headquarters on May 19, 2016).
5) Pushing ahead with smart agriculture
・ Develop safety guideline in this fiscal year so that in-field unmanned
automatic driving systems under manned supervision will be commerciallyavailable by 2018 at latest. Push ahead with joint research efforts and related
schemes in order to create remote monitoring-based unmanned automatic
driving systems, such as mobility between agricultural fields, in 2020 at latest.
[Develop safety guideline within this fiscal year][Successfully develop remote monitoring-based unmanned automatic driving
technologies by 2020]6) Establishing collaborative scheme between agricultural and industrial circles
・Enhance tie-up between agricultural and industrial circles to push ahead withmodel R&D with state-of-the-art technology corporations and develop new
products in tie-up with regional commerce/industry chambers/associations.
・Create a human resources matching scheme in collaboration with industrial
sector so that agricultural corporations will be able to hire their humanresources with working experiences or skills in other industries in order toexpand their business operations.

(9) Tourism-oriented country
1) Enhancement of the attractiveness of tourism resources (Opening up State
Guest Houses and utilizing cultural assets and national parks)
・Boldly open up to the public the state guest houses in Akasaka and Kyoto andother governmental facilities with full of Japan’s history and traditions.
・Aiming at putting more emphasis on “providing support to comprehensive
utilization of regional cultural assets,” shifting away from traditional“preservation-oriented support” programs, develop “The Strategic Programfor Promoting the Use and Understanding of Cultural Assets 2020” andestablish tourism bases with focus on Japan Heritages and cultural assets.
[Develop the program at the beginning of this fiscal year, and establish about
200 tourism bases nationwide by 2020]
・Aiming at branding Japanese national parks as the world-class “national

43

parks,” intensively carry out the projects, such as developing “TheNational Parks Step-up Program 2020 (tentative name)” for 5 nationalparks at first, attracting private-sector’s insights and funds, launching
high-quality plans enjoyable for foreign visitors, showing high-quality
feeling and intensifying information dissemination.
[Develop the program within this fiscal year]
2) Revision of tourism-related regulations and systems (expanding
guide-interpreter services, etc.)
・Aiming at expanding guide-interpreter service supply, revise guide-interpreter
system, including “service monopoly schemes” while keeping service
quality. In addition, grasp actual situations of tour operators by introductionof their registration scheme and examine feasibility of appropriate
guidance/supervision system for problematic tour operators.
[Revise related systems within 2017]3)
Promotionofestablishinganddeveloping
Destination
Marketing/Management Organizations (DMOs)
・Implement 100 attractive tourism investment projects nationwide, support
these projects with public-private funds and develop 100 world-class
DMOs nationwide by 2020.
[Develop 100 world-class DMOs nationwide by 2020]
4) Development of tourism human resources
・For development of top-level managers that play leading roles in the tourism
industry, develop education programs in government-industry-academia
collaboration and start all-out efforts for setting up tourism administration
graduate school (MBA) programs at Japan’s top-level universities.
[Start all-out efforts in this fiscal year]
・Aiming at strengthening development of human resources that play central
roles in regional tourism, develop standardized curricula for tourism school
programs at the university level. In addition, improve education programs incollaboration between the industrial sector and education institutes including
special training schools, in order to develop regional practical tourism
human resources immediately ready for regional tourism.
[Start all-out efforts in this fiscal year]445) Improvement of regional tourism environment to accept an increasing
number of foreign visitors to Japan・As for regional problems identified at regional bloc liaison committees set up
in the last March, take quick actions by clearly identifying players anddeadlines for each problem, paying due attentions to the new goal of thenumber of foreign visitors to Japan.
6) Promotion of taking leaves/ staggered holidays
・Encourage education committees and schools to flexibly set and diversify school
nonworking days, work with the industrial sector for extending annual paid
leaves by 3 additional days and encourage central government’s civil servants
to take their annual leaves in line with school nonworking days.

2.

Regulatory and Institutional Reforms Making the Revolution in Productivity
Happen(1) Introduction of a new mechanism for regulatory and institutional reformsi) Introduction of a roadmap approach for designing concrete reforms by counting
backward from the future image of industrial innovations
・ The government and the private sector will once share the future business image that theyshould aim to realize by designating a deadline. Then they will draw up a roadmap by
counting backward from there and introduce a new mechanism for implementing
regulatory and other reforms, also known as a “roadmap approach by counting backwardfrom the goal.”[Aim to introduce it in or after this year’s summer]ii) Introduction of a new methodology for regulatory and institutional reforms to promoteregulatory reforms, simplification of administrative procedures, and evolution of
information technology in an integrated and unified manner from the entrepreneur’s
perspective
・ First of all, reach a conclusion toward fundamental simplification of regulatory andadministrative procedures relating to activities of foreign companies making investments
in Japan within one year.
[Reach a conclusion within one year (with respect to those issues for which a conclusion
can be reached early, determine concrete measures as advanced efforts within thisyear, and start to implement them)]
・ Taking the status of the performance of the above-mentioned efforts into consideration,
conduct surveys on how foreign countries are coping with those issues, consider how
regulatory and procedural costs should be reduced and goals should be set up and then45

decide focused areas where the government should promote regulatory reforms,
simplification of administrative procedures; and evolution of information technology in
an integrated and unified manner and on a full-scale basis by the middle of next year, andpromote systematic efforts.
[Decide focused areas and reduction goals by the middle of next year](2)

Utilization of National Strategic Special Zones (a breakthrough for structuralreforms)・ Develop an environment where it is easiest in the world to do business so that the private
sector can fully demonstrate their capabilities by designating the period of two years up to
the end of FY2017 as “intensified reform reinforcement period” and setting up the effort
of breaking through the “bed-rock regulations” that has still remained as a “new goal,”
and ultimately connect it to an economic growth.
[Take prompt statutory and other measures for the regulatory reform targets, including
those to be addressed at the next Diet session](3) Institutional reforms toward the investment in the futurea) Strengthening of corporate governancei) Improvement of the effectiveness and efficiency of disclosure of corporate information
which will operate as a basis of constructive dialogue between companies and investors
・ From the standpoint of promoting dialogue between companies and investors mentioned
in the “Stewardship Code” and based on the previous discussions at the meetings of the
Financial System Council, the relevant government bodies and Tokyo Stock Exchange,
Inc. will work together to have trans-system and cross-government discussions, and aim toembody a disclosure system which is globally most effective and efficient and develop an
environment which is designed to set reasonable schedules and record dates for general
meeting of shareholders by sorting out, and eliminating duplications of, disclosure items
under the systems of the Companies Act, Financial Instruments and Exchange Acts, andthe relevant stock exchange securities listing regulations in the first half of 2019.
[Develop an environment for embodying globally most effective and efficient disclosureand setting reasonable schedules and record dates for general meeting of shareholders:
Aim to realize them in the first half of 2019][Organize the approaches of the relevant government bodies for unified disclosure ofbusiness report and annual securities report, and decide concrete ways to move it on withrespect to items that can be shared in the both reports: Within this fiscal year][Assess and analyze details of reviews of consolidated financial results releases forquarterly disclosure, and the resulting influences and effects, and identify points that
require improvements in the future: Start sequentially within this year]ii) Computerization of the general meeting of shareholders processes
・ Consider what concrete legislative measures to take, while aiming to start improvement of
the legislative system under the Companies Act early next year, in principle, in order toenable electronic provision of attachments to the notice of convocation of the general
meeting of shareholders (such as the business report and financial statements).

46

[Aim to start improvement of the legislative system under the Companies Act earlynext year]b) Smooth supply of growth money through realization of vigorous financial and capital
marketsi) Promotion of portfolio rebalancing and development of market environment that willcontribute to supply of growth money.
・ The Financial System Council will discuss points of issues to ensure fiduciary duty,
develop tools in support of long-term stable investments, and secure the fairness,transparency and stableness of the market.
[Aim to reach a certain conclusion within this fiscal year]ii) Exhibition of quality financial intermediary functions (reinforcement of the efforts such as
feasibility study finance and principal business support)
・ Establish various types of benchmarks to assess financial intermediary initiatives[Establish them within this fiscal year]iii) Promotion of FinTech (e.g., formulation of FinTech ecosystem)
・ Consider issues and responsive actions surrounding FinTech, and proceed to formation ofan environment in which FinTech enterprises can grow (i.e., FinTech ecosystem)[The Panel of Experts on FinTech Start-ups to start discussion promptly]iv) Thorough utilization of big data (such as standardization of data that can be collected inconnection with credit card transactions)
・ Promote standardization of data that can be collected in connection with credit cardtransactions[Reach a conclusion on standardization within this year]c) Expanded opening of public services and assets to the private sector through
PPP/PFI・ With the goal of attaining the numerical target of expanding the business size of PPP/PFI
to 21 trillion yen by FY2022 that is mentioned in the “Action Plan for Promotion of
PPP/PFI” (decided by the Council for the Promotion of Private Finance Initiatives on May
18, 2016), reinforce the efforts both in the growth-based areas such as airports, education
facilities (athletic facilities, social education facilities, and cultural facilities), cruising shippassengers terminal facilities, and MICE facilities), and the maturity-based areas such as
toll highways, water services, sewage systems, and public housing.
[Expand the business size of PPP/PFI to 21 trillion yen by FY2022]

47

3.

Creation of innovation/ development of human resources full of fight(1) Strengthening creation of innovation, startup companies startupi) Organization-to-organization full-scale industry-academia collaboration (Tripling
investment from companies to universities and National R&D Institutes and etc.:
Establishing five world-leading research base staffed with top researchers from Japan andoverseas, by FY2025)
・ Aim to triple investment from companies to universities and National R&D Institutes andetc. by FY2025. Also create strategic research bases that can invite Japanese and foreign
top-level talents and investments through full-fledged industry-academia-government
collaboration and global collaboration.
[Create at least five (5) research bases within next fiscal year]ii) Embodiment of research and development and industrialization strategies at the “Artificial
Intelligence Technology Strategy Council”
・ The “Artificial Intelligence Technology Strategy Council” which was formed in April thisyear, by gathering the wisdom of industry, academia and the government, as a control
tower function that will direct formulation and implementation of technology strategies
through the use of the strength of Japan will establish research and development goals anda roadmap to industrialize artificial intelligence, thereby centrally promoting the processes
ranging from research and development to social implementation.
[Establish a roadmap within this fiscal year]iii) Development of “Region-World Bridge Project”
・ Expand the efforts for “Silicon Valley-Japan Bridge Project” which started during the last
fiscal year to Asia, Israel, Europe, and other regions, keeping connecting it to the “Global
Startup Summit (tentative name)” to be held in 2020 in mind.
[Start to implement in this fiscal year]
・ The government bodies will implement measures on startups to build up a “consortiumof the government bodies” that will provide support with focus on discovering promisinglocal startup companies and assisting them in making a challenge to the global market, set
up an “advisory board” consisting of members from the private sector, and support
challenges of startup companies to the global market and give advice on the government’s
startup support policy.
[Build it within this fiscal year](2) Fostering and securement of human resources who can explore economic growthi) Measures to foster and educate human resources who will sustain the Fourth Industrial
Revolution
・ Review new National Course of Study that will be started sequentially in FY2020 in orderto ensure fostering of the ability to utilize information through learning at primary andsecondary education from a perspective of active learning, learning guidance according tostudents’ individual levels of academic achievement utilizing IT effectively (adaptive48

learning), and compulsory activities of programming education according to developmentlevels.
[Implementation of new National Course of Study including compulsory activities ofprogramming education: FY2020 for elementary schools; FY2021 for junior high schools;
and FY2022 for senior high schools]
・ Promote development of faculties and graduate schools that will foster top-level data
scientists and other professionals, and reinforce university-wide mathematics education(formulation of standard curricula) to reinforce mathematical sciences and information
education at higher education institutions.
[Start concrete efforts in next fiscal year]
・ Specified national research and development corporations and top-level research centers
and universities in Japan will work together to conduct top-level researches into IoT, bigdata and artificial intelligence and foster human resources who will sustain the Fourth
Industrial Revolution, while inviting the world’s class researchers in a unified manner.
[Start to implement them in this fiscal year]ii) Holding the “Council for Promoting Human Resource Development to respond to the
Fourth Industrial Revolution”
・ Hold the “Council for Promoting Human Resource Development to respond to the Fourth
Industrial Revolution” for the purpose of fostering human resources who will sustain the
Fourth Industrial Revolution, consider the required skills and businesses, etc. with theattendance of people from the relevant government bodies, the industry and so on, andreflect them in the government’s human resources and education policies. [Reprinted][Hold by the end of this year]iii) Introducing of the world’s fastest such system of “Japanese Green Card for Highly Skilled
Foreign Professionals”・ Introduce the world’s fastest such system of “Japanese Green Card for Highly Skilled
Foreign Professionals” by substantially reducing the period of stay required before
highly skilled foreign professionals can apply for permanent residence from the current
five years.
[Take necessary measures as soon as possible](3) Improving employment environment and promoting participation of various workers
to overcome growth restrictionsi) Enhancement of efforts to remedy long working hours
・ Reinforce supervision and guidance of labor standards office, including ensuring
supervision and guidance of places of business that are suspected of having theiremployees work overtime in excess of eighty hours a month, and reinforcing supervisionand recommendation when a notification of the Article 36 agreement setting forth
overtime work in excess of eighty hours a month is submitted.

49

[Start to implement them in this fiscal year]
・ Reconsider how the overtime work regulations in the Article 36 agreement should be,
while making efforts for early passage of a bill of amendment to the Labor Standards Act
submitted to the Diet in April last year.
・ Incorporate well-refined measures, such as measures to place an interval between work
hours, into the guidelines under the Act on Special Measures for Improvement of Working
Time Arrangement as concrete examples of voluntary efforts.
ii) Promotion of further social participation of women and elderly persons
・ Steadily promote expanding the capacity of childcare facilities and securement ofchildcare staff, while securing stable financial sources, through promotion of the “plan for
acceleration of elimination of childcare waiting lists,” aggressive development of“company-led childcare business,” reduction of business burdens through the use of ICT,
support for obtaining nursery teacher qualifications, and further improvement of working
condition of, and construction of career paths for, nursery teachers.
[Start to implement them sequentially in this fiscal year]
・ Clarify how diversity management leading to the growth potential and profitability ofcompanies should be, and consider measures to enhance the appeal of diversity
management to companies and investors.
[Initiate a new forum of discussion, and reach a certain conclusion within this fiscal
year]
・ Enhance supports for companies and other organizations maintaining continued
employment beyond the age of 65 and extending mandatory retirement age to the age of65.
4. Taking in overseas growing marketsi) Promotion of economic partnership negotiations, and concluding/amending investment
agreements and tax treaties
・ Push forward to achieve early entry into force of the TPP and expand its member
countries/regions, and strategically and expeditiously promote economic partnershipnegotiations including the Japan-EU EPA, RCEP, and Japan-China-Republic of Korea
FTA. Japan will play central roles in building such wide-area new economic orders, andaim to take the lead in establishing comprehensive, balanced and high-level global rules.
In addition, Japan will promote concluding/amending investment agreements and tax
treaties.
[Aim to sign and/or achieve entry into force of investment-related agreements covering
100 countries and regions by 2020]ii) Support for overseas expansion of regional small and medium-sized companies taking
opportunities afforded by the TPP

50

・ In order to support exploitation of a huge market that will be afforded by the TPP, provide
comprehensive support to small and medium-sized companies under the “Consortium for
New Export Nation”[Started the implementation in February this year]iii) Increase of infrastructure exports
・ In addition to reinforcing supports through investments and loans from public financial
institutions and public-private funds and trade insurance, effectively combine
government-wide measures including enhancement of feasibility studies (F/S) anddemonstration and verification projects, development of local human resources andstrategic public relations activities, and development and administration of testing andevaluation facilities to obtain international standards and certifications, thereby
reinforcing joint efforts by the government and the private sector towards receiving
project orders.
・ Strengthen the institutional capacity and financial grounds of Japan’s relevantorganizations, including JICA, JBIC, NEXI and JOGMEC.
iv) Promotion of inward foreign direct investment
・ Promote business alliance between regional Japanese companies and foreign companies,
and strengthen strategic promotion by local governments to attract foreign investment.
Also endeavor to reinforce public relations including sales pitches. In addition, makefundamental improvements of business and living environment that would become
obstacles to invite foreign companies, through simplification of regulatory andadministrative procedures and promotion of foreign language services in living
environment.
5.

Utilization of a Momentum of Reform (Promotion of “Reform 2020” Projects)

・

In promoting each project, the following have been designated as common issues thatshould be especially tackled in all projects: to identify the entities implementing the
project and place of implementation, in principle, within this fiscal year and strictly
manage progress of the project; to clarify necessary regulatory forms early; and to keep inmind that the project will contribute to resolution of social issues, including those that isnow coming to the surface in the world and will be connected to a legacy that can be
succeeded beyond 2020.

51

(Reference) Potential Effects that May Be Brought by the “10 strategic public-private joint
projects toward the Achievement of a 600 Trillion Yen Economy”
Fourth Industrial Revolution
Toward a world leading healthcare country
Overcome environment-energy constraints andexpand investments
Changing sports to a growth industry
Revitalizing markets for transaction of existinghouses and reform
Productivity improvement of service industry;
Renovation of mid-ranking companies, SMEs
and microenterprises
Promote proactive agriculture, forestry andfishery, as well as reinforce export
Tourism-oriented country

Added value to be created: 30 trillion yen [2020]
Market size: 26 trillion yen [2020](cf. 16 trillion yen [2011])
Energy-related investments: 28 trillion yen[FY2030](cf. 18 trillion yen [FY2014]
Market size: 15 trillion yen [2025](cf. 5.5 trillion yen [2015]）
Market size: 20 trillion yen [2025](cf. 11 trillion yen [2013]
Added value of the service industry: 410 trillion
yen [2020](cf. 343 trillion yen [2014])
Sixth Industry market: 10 trillion yen [FY2020](cf. 5.1 trillion yen [FY2014]
Amount of travel consumption by foreign tourists
8 trillion yen [2020]; 15 trillion yen [2030](cf. 3.5 trillion yen [2015])
Total amount of travel consumption by foreigners
vising Japan and Japanese nationals
29 trillion yen [2020]; 37 trillion yen [2030](cf. 25 trillion yen [2015]）52