Provisional

Agenda for the Evolution of the Growth Strategy
January 25, 2016
Council for Industrial Competitiveness
Abenomics has entered the second stage to realize “A Robust Economy that Gives Riseto Hope” with the nominal GDP of 600 trillion yen, the largest ever after the World War II.
The gears for a virtuous economic cycle continue rotating steadily. In order to maintainand accelerate this trend as well as place the Japanese economy on a sustainable growthpath, we need to turn the record-high corporate earnings into investment for the future,including that in facilities, technologies and human resources, and thereby bring about
revolution in productivity to break the growth restraints caused by the declining trend of
the population. Moreover, under the collaboration of industry, academia, and government,
reform in the fields which pave the way for a new era should be pursued rapidly andthoroughly to ensure that Japan will become a leading country ahead of other countries
and regions by seizing the largest opportunity of this century, the Fourth Industrial
Revolution which could fundamentally change the economic and social structures.
Competitors in the world are making challenges for their survival beyond the borders ofconventional common sense, industries, and business categories. There is an opportunity
to win, however. Now is the time to make a clear break from the successful experiences in
the past, make decisions for new challenges across organizational boundaries, and create
the trend in which risk money will flow into new growth fields.
Development of human resources with overwhelming challenging spirits will be the key
to realize such revolution in productivity and growth by the Fourth Industrial Revolution.
It is essential to promote the development of human resources with an eye for the futuresociety and the era of the Fourth Industrial Revolution in all the educational stages fromelementary and secondary to higher education so that creative people, who are capable ofgenerating new value-added by throwing themselves into new challenges and combining
different things, can play important roles in every industry and academic field. In addition,
we also need to further reinforce measures to promote the participation of various workers
in order to strengthen the innovation capability of the economic society by enhancing thediversity of human resources in Japan as well as breaking through the growth restraints
posed by the decreasing population.
Moreover, through the promotion of revolution in productivity and innovation, thedevelopment of human resources that will shoulder them, and the participation ofdiversified workers, markets in various fields with growth potentials are expected to
expand in Japan. At the same time, it is important to have the perspective that without thevitalization of local economies, there will be no economic growth of the whole country or
success of Abenomics. To realize vigorous economies across Japan, it is essential tofurther strengthen the competiveness of medium enterprises and SMEs which aresupporting the backbone of the Japanese economy, as well as promote reform and theimprovement in productivity in the industrial fields that lead local economies (agricultural,1

forestry and fishery industries, tourism business, service industries, public services, etc.)
Furthermore, the creation of vast value chains in the Asia Pacific region through theagreement in principle in October 2015 on the Trans-Pacific Partnership (TPP) which is a
trump card for the growth strategy will open a new era which enables companies in all
sizes and individuals to connect to the markets in the region, the growth center in theworld, and to blossom their potentials globally. It is the key for success as to whether we
can take an aggressive management stance, by taking this as an opportunity. Government
will also need to intensively take measures to vitalize the flow of goods, money,
technologies, and human resources in the both out-bound and in-bound directions, such as
promoting the overseas expansion of excellent Japanese goods and services and foreigncompanies’ direct investment in Japan, by supporting individual economic entities inchanging their thinking and action to the future-oriented.
At the same time, in order to implement and accelerate these reforms, it is necessary tocontinue utilizing the year 2020—when the Tokyo Olympics and Paralympics, which
attract attention internationally, will be held—as the momentum for reforms. Moreover, it
is also important to proceed with various reforms from the perspectives as to how weshould develop new economic and social systems, and increase the benefits for theJapanese people as a whole which cannot be measured by the economic size alone, inorder to overcome fundamental challenges to the development of the Japanese economy
and society in the medium- to long-term, including the response to the ageing society withfewer children/the society with decreasing population, and the overcoming of therestraints on environment and energy.
With the above recognition, the Council for Industrial Competitiveness and its
Implementation/Realization Inspection Meetings will further examine the following inorder to accelerate and evolutionize the Growth Strategy which supports “A Robust
Economy that Gives Rise to Hope”:
・Mechanism to realize revolution in productivity
・Creation of human resources to carry on growth・Strategy to expand strategic growth markets (including the promotion of local
Abenomics)
・Capture of overseas growth markets
・Momentum for the reform through the promotion of the“Reform 2020”projects
In doing so, in addition to working together with the“Public-Private Dialogue towards
Investment for the Future,”we will closely cooperate with relevant meetings, including
the Council for Regulatory Reform, the National Strategic Special Zone Advisory
Council, the Headquarters for Overcoming Population Decline and Vitalizing Local
Economy in Japan , the National Council for Promoting the Dynamic Engagement of All
Citizens, and the Council for Science, Technology and Innovation.
We will reflect the initiatives along with these intentions to the Growth Strategy whichaims to promote economic growth through regulatory and institutional reforms etc.
2Moreover, regarding the KPIs (Performance targets to be achieved for each policy group)
which have been established by the successive growth strategies, we will re-evaluate theappropriateness of all KPIs and sort them out as necessary, from the perspective of
implementing the second stage of Abenomics.

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Ⅰ

Mechanism to Realize Revolution in Productivity: Igniting Investment in Innovation

1．Promotion of the Fourth Industrial Revolution/ Development of New Institutional
Environment for IoT Era(1) Redesigning systems of economic society which respond to the Fourth Industrial
Revolution
The Fourth Industrial Revolution requires us to deal with the “Super Smart Society”(Society 5.0) which brings about new value-added and improvement of the quality oflife by utilizing IoT, BD (Big Data), AI (Artificial Intelligence), and robots to the
maxim extent, and combining the cyber and physical spaces in a sophisticated manner.
Under such circumstances, competitive environment is changing beyond theexisting industries and national borders over the “Data” which are the source of newvalue added. Accordingly, under the “New Industrial Structure Vision,” theGovernment will identify the changes in specific industrial and employment structures
and the resulting impacts on the life of individual people, and thereby engage indeliberations aimed at reaching a social consensus by the public and private sectors
towards the redesigning of new systems of economic society to preempt such a visionof the future.
Specifically, the Government will discuss, while clarifying the timeframe, thedevelopment of horizontal infrastructure concerning systems and rules (developmentof systems to promote the utilization of data, regulatory and institutional reforms
concerning entry restrictions etc., vitalizing industries and facilitation of businessrealignment for companies and industries to respond rapidly and flexibly to structuralreforms, intellectual properties and competition rules, etc.), human resources(improvement in the mobility for education and employment), technologies andinnovations (vitalization of investment in research and development through theformulation of a technological roadmap, development of the environment to enable thecreation of further innovations, etc.), infrastructure (sophistication of important
infrastructure, enhancement of industrial security, etc.) among others.
Furthermore, as the public and private sector initiatives to be tackled immediately,
the Government will consider the clarification of cooperative and competitive areas inimportant fields, promotion of strategic initiatives, creation of platforms taking
advantage of Japan’s strengths, enhancement of accompanying investment for the
global acquisition and development of data-related personnel as well as the promotionof future investment type M&As etc.
(2) Promoting the creation of new businesses to facilitate the Fourth Industrial Revolution
Through the activities of the “IoT Acceleration Consortium” etc., the Government
will consider the responses to horizontal issues including regulatory and institutional
reforms in each business field, formation of new rules, and distribution of cybersecurity data, while creating new business models responding to the Fourth Industrial
Revolution, developing information and telecommunication infrastructure,developing/verifying/making IoT related technologies as international standards,
among others.
4(3) Promoting Research & Development for IoT/BD/AI in an integrated manner
Regarding research & development for IoT/BD/AI with an eye for the Fourth
Industrial Revolution, the Government will describe, as a roadmap, the nextgeneration AI technologies necessary for the future, identification of technologies witha high affinity with them, and the future outlook; and engage in deliberations to
identify the centralized control tower function to promote it in an integrated manner.
(4) Thoroughly utilizing and developing institutional environment for data and IT with aneye for the IoT/BD/AI era
Given that thorough utilization of data and IT will decide international
competitiveness in the IoT era, both private and public sectors will play their part inmaterializing the initiatives to realize the IT utilization at the world’s highest level,with the precondition of securing cyber security through the steady implementation of
measures listed in the “Cyber Security Strategy” etc. Specifically, in order to ensureand strengthen cyber security, the Government will consider strengthening measuresfor companies and public institutions, including the development of human resources
by promoting acquisition of special qualifications and utilizing large-scale mockinfrastructure, research & development, international cooperation, and important
infrastructure.
Moreover, for economic revitalization and resolution of social issues, theGovernment will consider further utilization of IT in the areas of education, tourism,
agriculture, health care/nursing care/health, regional revitalization, finance, etc., aswell as further utilization of My Number Cards and My Portals, given the introductionof the My Number system, expanded utilization of public individual authentication
services such as the development of the system for authenticating the authority intransactions between corporations etc., further promotion of open data, developmentof sophisticated IT personnel and so forth. In addition, the Government will consider
measures to improve productivity in all industries, companies and businesses,
including the utilization of IT by medium enterprises and SMEs.
Furthermore, the Government will design the system for the “Agent Institution(tentative name)” which takes charge of specific ways to disseminate IT principles
throughout the society by 2020 and the utilization of safe and secure data; andregarding the sharing economy, it will engage in deliberations from the perspective of
rapidly promoting sound development of new industries, while paying attention to theframework of consumer protection and conflict resolution, development of faircompetition rules, consistency with individual business laws, and discipline onintermediary businesses through the use of the internet etc.
(5) Developing the environments for mobile and wireless fields with an eye for IoT/BD/AI era
In order to give the benefits of the full-scale spreading of IoT back to the society, it
is necessary to develop the information and telecommunication environment tosupport the creation of innovation. Specifically, it is essential to steadily implement thepromotion of competition in the mobile field which supports inexpensive and various
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IoT services, and the establishment of wireless technologies which can deal with theexponentially-increasing data traffic etc. Accordingly, the Government will conduct
deliberations to promote the spread of MVNO through the rapid disclosure of thefunctions including the subscriber management function, upgrade the mobile networks
in response to IoT, secure the frequency bands to deal with the increasing demand for
frequencies, and realize the 5th generation mobile communication system (5G) etc.
2．Strengthening of the Abilities to Create Innovations and Venture Businesses(1) Implementation of the re-building of a national system of innovation
Aiming for the world’s top level, the Government will establish DesignatedNational University system (tentative name) which attracts various resources in Japanand abroad through its high management power. In doing so, the Government will also
examine the framework to realize Venture Ecosystem centered on universities (Apositive cycle in which technologies etc. owned by universities attract further humanresources and funds, and thereby venture businesses are created, which in turn attract
human resources, technologies and funds)
Regarding the Distinguished Graduate School (tentative name) which will become
the hub for developing excellent personnel and exchanges/joint researches ofresearchers/students, for the realization of the initiative from FY2016, the Government
will accelerate deliberations on the setting out of the fields with an eye for new
developments such as IoT/BD/AI, as well as the frameworks etc. to widely involve
excellent researchers in industry, academia and government, while aligning with theexisting measures to establish bases etc.
Moreover, the Government will continue promoting the further strengthening of the“bridging” function of public research institutions to link universities’ technology
seeds to industries and the establishment of the venue for co-creation to combine
technologies and human resources; at the same time it will examine the framework etc.
to accelerate movement of human resources between universities/public research
institutions and companies, utilizing the cross-appointment system etc. In addition,
regarding the framework to promote open innovations by the cooperation among
companies in the same industry or beyond industries, while incorporating aggressively
the knowledge and technologies outside the organizations, including global
perspectives, the Government will conduct deliberations on measures including theutilization, as the focal point, of public research institutions etc., including the“Designated National R&D Institutes” (tentative name).
(2) Promoting full-fledged cooperation between the industry and academia
Given that the environment surrounding innovations, including the Fourth Industrial
Revolution, is changing more rapidly than expected, and it has become important totake in technologies within Japan and abroad regardless of their origin, and new
relationship has been created that basic research and development for social
implementation have an influence on each other etc., the Government will conduct
survey and analysis on developments of science and industrial technologies in Japanand abroad, and at the same time, examine the measures to promote full-fledged
industry-academia cooperation between universities and companies (including
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initiatives to make joint research larger in size and internationalized) such as new
ways of the industry-academia-government cooperation, risk of technology outflow/intellectual property management/system development on the university side,
appropriate research expenses in joint researches.
(3) Promoting strategies for intellectual properties and standardization to win in the Fourth
Industrial Revolution etc.
The Government will analyze the issues for intellectual properties to emerge withthe social implementation of IoT/BD/AI etc. which are not the extension of theprevious technologies; at the same time, it will examine the framework led by thegovernment to strengthen the system to promote international standardization,
education on intellectual properties, the measures to develop human resources forstandardization in order for Japanese companies to win in these areas etc., wherecompetition to capture the market has internationally become intensified.
(4) Developing the eco-system for venture businesses
In addition to venture businesses originating from universities, the Government will
examine the measures to create, develop, and utilize venture companies so that
research results will be linked to social implementation, including the necessary
measures to promote the creation of venture businesses originating from national
research and development corporations, and cooperation among universities, large
companies, venture capitals and venture companies.
In addition to this, for the development of the venture business eco-system toproduce global venture companies which will take on world-wide challenges andventure companies which are capable of bringing out the potentials of local areas tothe maximum extent, the Government will organically integrate and cooperate with themeasures of relevant ministries and agencies and moreover, formulate rapidly the“Venture Challenge 2020 (tentative name)” which will become a roadmap up to 2020
to further improve the innovative power of large companies and universities that haveabundant human resources and technologies etc.

3. Development of the Environment to Encourage Investment for the Future
In order to encourage investment for the future, the Government will conduct
deliberations on the strengthening of corporate governance as well as institutional andregulatory reforms in individual business areas; at the same time, it will surely implement
growth-oriented reforms of the corporation tax system and the establishment of special
measures for fixed asset tax on machinery and equipment, etc. incorporated in the Tax
Reform for FY2016.
(1) Promoting the strengthening of corporate governance and medium- to long-term
investment
The “Council of Experts Concerning the Follow-up of Japan’s Stewardship Codeand Japan’s Corporate Governance Code” will follow up on whether they have beendiffused and firmly established; at the same time, it will continue examining necessary
7measures to further enhance corporate governance of the listed companies as a whole.
Moreover, in order to encourage medium- to long-term investment, the Government
will endeavor to ensure that corporate capital will be effectively utilized, including
investment in non-tangible assets (human resources and intellectual capital etc.) in
addition to the so-call ESG (Environmental, social and governance) investment.
Accordingly, it will examine specific measures to enhance dialogue between
companies and investors concerning the ways in which information on these will beappropriately and effectively provided, evaluated and utilized.
(2) Developing the environment as well as institutional and regulatory reforms inindividual business areas
1) Accelerating the promotion of National Strategic Special Zones
During the period for intensive efforts until the end of FY2015, the Government,
after making a breakthrough for reform of the so-called rock-solid regulations as awhole, will conduct specific deliberations to add bold regulatory reform measures
without decelerating the speed of reform after the end of the intensive efforts period,
while scrutinizing the issues for regulatory reforms to be tackled, taking into accountthe deliberations by the National Strategic Special Zone Advisory Council on the
promotion of stay/employment of foreign personnel and the reinforcement ofcompetitiveness of agriculture, forest and fishery industries.
Moreover, the Government will deal with them speedily if there are regulatory
reform proposals with a high economic impact from local governments andbusinesses, including the designated zones; realize specific projects one by one
including nation-wide measures; and designate new zones, if necessary.
Furthermore, in the 10 designated zones including those of the 3rd designation, theGovernment will rapidly realize specific projects in a visible way by fully utilizing
regulatory reform measures based on the Act on National Strategic Special Zones, andalso through various public relations strategies including pamphlets and TV programs;
at the same time, it will strictly evaluate the results of such reforms by the National
Strategic Special Zone Advisory Council etc. one after another, and thereby makethem lead to further reform initiatives.
2) Developing the environment to realize sophisticated autonomous driving including
unmanned autonomous driving
In accordance to the policy of developing systems and infrastructure to enabletransportation services by unmanned autonomous driving and the autonomous driving
on highways at the 2020 Olympics and Paralympics, including the initiatives to enable
necessary verifications by 2017, the Government will examine necessary measures
including the specification of an action plan for matters to be tackled.
3) Developing the environment to enhance the industrial use of small unmanned aerial
vehicleAiming at enabling baggage delivery using drones as early as within 3 years etc.,
the Government will examine specific systems to secure further safety and thedevelopment of the environment to promote utilization/technological development for8the realization of the “Industrial Revolution in the Air.” It will 1) decide on the
direction of the system design by the summer of 2016, and after that, continue further
examination on the details of the system based on this direction; 2) moreover, preparea roadmap for the utilization and technological development by the summer of 2016;
and furthermore 3) will take necessary measures by the summer of 2016 to enable theexpansion of frequencies and increase in output power to be used for controllingdrones etc. and transmitting data, as well as the utilization of mobile phones in theupper air.
Moreover, in order to promote the development of small unmanned aerial vehicle
for various uses such as distribution, the Government will aggressively conduct
verification experiments in the National Strategic Special Zones and the robot test
field to be developed under the Fukushima Innovation Coast Initiative. Furthermore,
the Government will examine the possibility of utilizing small drones in combination
with the utilization of the “Special provisions for the face-to-face principle ofmedication instructions by pharmacists utilizing videophones” on the condition of
securing safety and reliability.
4) Facilitating deliberations on the acceleration of utilizing robots in the society
While steadily implementing the initiatives to achieve the targets listed in the “NewStrategy for Robots,” the Government will present the whole Japan as a showcase ofrobot utilization by resolving the social issues we are facing ahead of the world
through the realization of daily life with robots in wide-ranging fields. In particular,innovations will be promoted through international competitions and the robot test
field to be developed under the Fukushima Innovation Coast Initiative. In addition, theGovernment will conduct deliberations on developing the environment to encourage
the utilization of robots in wide-ranging fields, starting with the accelerated
introduction of robots by SMEs, and including the development of platform robots,
formulation of the performance evaluation standards with an eye for international
standards, standardization of procedures and skills which will become the bases for thesystem integration function, and development of human resources.
5) Expanding investment in energy and environment field
The Government will achieve economic growth and CO2 emission reduction at thesame time, by expanding investment in energy—through the implementation of energy
system reform and realization of energy mix—and thereby improving the energy
efficiency.
Accordingly, the Government will promote thorough energy efficiency in all
sectors, starting with the expansion of the Energy efficiency benchmark Program, andincluding the support for energy efficiency by SMEs and promote effective utilizationof waste heat in the industrial sector; energy efficiency of houses and buildings
including the diffusion of ZEHs (Net zero energy houses) in the residential sector; andthe initiatives to introduce autonomous driving and next-generation automobiles in thetransportation sector. Moreover, the Government will review the Feed-in Tariff
Scheme for Renewable Energy etc.; at the same time, enhance the introduction ofrenewable energies by promoting the development and verification of hydrogen9energy storage technologies which will contribute to reducing grid loads. Furthermore,
the Government will conduct deliberations on developing the regimes for creating newenergy systems, including the establishment of negawatt trading market where electric
power, saved by utilizing solar power and IoT, can be traded. Regarding electricity
business, the Government will conduct deliberations on realizing the systems torequire power generators and retailers to improve efficiency and reduce CO2.
6) Improving business environment through stable supply and cost reduction of energy
Given the possibility of rising resource prices in the medium- to long-term, theGovernment will conduct deliberations on developing the environment to stably
engage in resource development without being influenced by short-term volatility inresource prices, in order to stably restrain the procurement prices of energy. Moreover,regarding LNG, the Government will endeavor to create and develop flexible andliquidLNG markets, and coordinate international emergency response, through the G7
process and others. Furthermore, the Government will restart the operation of thenuclear power plants which have been acknowledged by Nuclear Regulation Authority
as meeting the strictest regulatory standards in the world.
7) Upgrading financial services utilizing IT
For financial services, while there have been the trends of the so-called FinTech thatcreates new services by combining finance and technology, following the recent
developments in IT technologies etc., it is important to upgrade financial services toimprove the convenience of users while securing the safety and security of users.
Accordingly, the Government will examine and promote necessary measures for theirrealization.

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Ⅱ

Creation of Human Resources to Carry on Growth

1. Human Resource Development and Education Reform(1) Reforming elementary and secondary education with an eye for the society in the future
For the Fourth Industrial Revolution, it is necessary to develop human resources
who are capable of engaging in creative activities to generate new value-added whileconnecting different and diversified knowledge.
In order to develop necessary qualities and abilities, it is necessary to realize“Academic programs open to the society” in elementary and secondary education, andeffectively develop the abilities to think and judge, sensitivity, leadership, andchallenging power which are required in creatively finding and resolving issues, andturning them into innovations, through the aggressive and active use of IT, outside
personnel, and private sector know-how. For their realization, we need the education
which develops necessary qualities and abilities surely and effectively, through thelearning from the perspective of active learning, such as focusing on experiential andproblem-solving learning as well as the learning according to the proficiency level ofindividual children (so-called adaptive learning).
Moreover, since human resources with the ability to utilize information are sought
after in all fields with the progress of the Fourth Industrial Revolution, we should
enhance English education in accordance to the global era, while developing andstrengthening the ability to use IT for solving issues and IT literacy throughprogramming from elementary and secondary education, not to mention at higher
education.
The Government will conduct specific deliberations to proceed with reforms to
improve the quality of education, such as implementing education in response to therequirements of such a new era, enhancing the qualities of teachers who can deal withthem, developing the environment in which they can give priority to spending timewith children by relieving them of miscellaneous duties and increasing the efficiencyof the administrative work etc., utilizing outside personnel and private sector knowhow, developing systems to cooperate with the outside, and thoroughly developing IT
environment etc.
(2) Institutionalizing new higher education institutions to conduct practical vocational
education
The Government will institutionalize new higher education institutions which willoffer the knowledge and skills for vocational practice. In doing so, it will consider
developing, for example, an evaluation system based on the track records for theemployment and entrepreneurial rates of students, ratio of working people
participation, and students’ satisfaction levels etc. in order to secure attractive
learning programs, environment, and outcome for students.

11(3) Producing the world’s top level personnel for the Fourth Industrial Revolution
Regarding the Distinguished Graduate School (tentative name) which will become
the hub for developing excellent personnel and exchanges/joint researches ofresearchers/students, for the realization of the initiative from FY2016, the Government
will accelerate deliberations on the setting out of the fields with an eye for new
developments such as IoT/BD/AI, as well as the frameworks etc. to widely involve
excellent researchers in industry, academia and government, while aligning with theexisting measures to establish bases etc.
Moreover, as regards the Distinguished Researchers system which enables excellent
young researchers to play an active role in a stable post and liberal research
environment, the Government will conduct deliberations on developing theenvironment in which they can engage in researches at universities, research
institutions and companies which are doing the most advanced researches including
such fields as IoT/BD/AI, while freely interacting among institutions, utilizing thecross-appointment system etc.
Furthermore, the Government will examine competitive research expenditure suchas the Grants-in-Aid for Scientific Research, from the perspective of developing andstrengthening human resources of young researchers, including distinguishedresearchers.
(4) Promoting human resource management of companies through the labor market
In providing and making the data base from the workplace information concerningcompanies’ initiatives for human resource development, the Government will consider(i) requesting and encouraging all companies which register job offers at Public
Employment Security Offices Hello Works etc., to actively provide workplaceinformation concerning the initiatives for human resource development, while utilizing
the formats etc. for reducing administrative burdens; and (ii) developing theframework in which companies actively engaged in human resource development etc.
will be evaluated positively in the labor market, through the preparation of a list foreasy comparison so that workplace information to be provided from companies to thegovernment will become easy to see and practical for job seekers. The Government
will thereby develop the environment for individual workers to exert their potentials to
the maximum extent, and play an active role to carry on economic growth, throughsmooth matching.

2. Development of the Environment for Employment and Participation of Diversified
Workers to Break Down Constraints on Growth(1) Strengthening the initiatives to rectify long working hours
Given that rectifying long working hours is the key initiative to improve the earning
power of companies through the improvement in productivity and to realize A Society
in Which All Citizens are Dynamically Engaged, the Government will examine themeasures to further encourage voluntary efforts of companies to rectify long working
hours, including a mechanism in which working hours etc. of companies are disclosed,
and a framework to highly evaluate companies which are promoting work-life balance12etc. more widely in public procurement, along with the implementation of the Act for
Women’s Empowerment and the Act for Promoting Youth Employment (Formulationof employer action plans and information disclosure etc.)(2) Promotion of active roles for women in local areas
Given that the realization of local communities, where women can play an activerole according to the situation of local areas, is yet at a developmental stage, theGovernment will examine the measures to further promote active roles of women inlocal areas, utilizing the initiatives based on the Act for Women’s Empowerment(Promotional plans and councils in local governments).
(3) Strengthening the initiatives for the “Elimination of Childcare Waiting Lists”
For the elimination of childcare waiting lists by the end of FY2017, the Government
will take a comprehensive initiative to accelerate the development of small-sizedchildcare centers and childcare centers on the business premises etc, and securechildcare workers, following the raising of targets for childcare arrangements (fromfor 400,000 children to 500,000 children). Moreover, the Government will conduct
deliberations on research and analysis on systems and cases in foreign countries tofurther improve social evaluation of nursery teachers.
(4) Changing to friendly systems etc. for working women
Regarding the tax system, social security system, and spouse allowance etc., theGovernment Tax Commission etc. and various other meetings will examine and realizechanges to friendly systems etc. for working women; for example, household income
will gradually increase if women are working, and they will receive security inaccordance to their employment.
(5) Accelerating comprehensive measures to employ and develop young people who will
create the future
The Government will aim to realize the environment in which young people whobear the future will be able to find and utilize their own abilities and characteristics intheir work life. Accordingly, taking into consideration the passing of the Act for
Promoting Youth Employment, the Government will conduct deliberations forrealizing and accelerating the provision of workplace information and introduction of“Self-career Checkup” by companies, and the initiatives to encourage human resource
development etc. by companies.
(6) Further enhancing the opportunities for active roles of the elderly
The Government will aim for realizing the society in which the elderly who arewilling to work will be able to play active roles for their entire life, utilizing theirabilities and experiences regardless of their age. Accordingly, it will conduct
deliberations for realizing the mechanism to create and match various opportunities forthe elderly.
(7) Integrated support for international students from acceptance to employment in Japan13

It is necessary to strengthen the initiative to enable excellent international students inJapan and abroad to play active roles in Japan after graduation, in order to expand theacceptance of highly skilled foreign professionals and contribute to the cultivation andsecuring by SMEs of human resources for the development of new markets.
Accordingly, in order to realize the smooth matching between excellent international
students and companies highly willing to hire them, the Government will examine an
integrated support program from study to employment in Japan, including high-quality
Japanese language education, internship, employment support, and support forchanging the status of residence categories.
Since it is necessary for international students in finding employment to have theadvanced Japanese language ability as well as understanding of corporate culture andhiring process, the Government will consider specific measures to raise the awarenessof international students, so that they can make necessary preparations aiming for
employment from an early stage at university. Moreover, the Government will
examine the mechanism to publish results for finding employment in Japan to create apositive cycle in which these results lead to the evaluation of accepting universities,
and to promote: the acceptance of international students more willing to findemployment in Japan; and the development of systems for their employment support.
(8) Consideration on medium- to long-term approaches to utilize foreign human resources
To ensure sustainability of economic and social infrastructure, the Government will
advance comprehensive and detailed study on the medium- to long-term approaches to
accept foreign human resources while focusing on the field where they are truly required.
To this end, the Government will conduct cross-governmental surveys andconsiderations regarding essential issues including a mechanism that would not be
misconstrued as an immigration policy, the way to shape the national consensus, etc.

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Ⅲ Expansion of Strategic Growth Markets for GDP towards 600 Trillion Yen andPromotion of Local Abenomics
1. Turning High-quality Healthcare Services into Growth Industry(1) Supporting the creation of the healthcare industry
Possibilities of the creation and utilization of various healthcare industries,
including simple tests and exercise guidance, have been enhanced, through theinitiatives such as the promotion of establishment of Regional Next-generation
Healthcare Industry Councils and the system to remove gray zone areas. The
Government will conduct deliberations for the development of the environment toensure that such trends will lead to behavioral changes in the direction of healthpromotion and the establishment of sustainable business models. Specifically, theGovernment will endeavor to promote the mechanism in which the people themselves
will manage and utilize the information on health, medical care and nursing care etc.
(PHR), and improve social recognition of the initiatives such as health management; atthe same time, it will develop business conditions, including the development of
supply chains to provide services, including medical institutions and personnel, so that
services outside public insurance coverage will appropriately supplement local
medical care and nursing services and be utilized.
Moreover, from the perspective of building the society where people are active for
their entire life, the Government will endeavor to promote the development anddiffusion of services related to health, medical and nursing cares, including thoseoutside public insurance coverage so that people will be able to continue independent(autonomous) life and participate in the society even if they have concerns about
health. In addition, the Government will conduct deliberations on health-maintaining
services including appropriate meals etc. required to continue work and life of those
who are in the state of remission for illness (the state in which symptoms takefavorable turns or mostly disappear and are controlled clinically), as well as
supporting services to enable people to spend their last stage of their life based on theirwishes while appropriate medical and nursing cares are provided at the core,including the coordination functions and appropriate divisions of roles.
(2) Fully utilizing ICT in the areas of medical and nursing cares etc.
For the introduction of ID in the areas of medical care etc., the Government willdevelop an online qualification confirmation system for medical insurance utilizing
personal number cards, gradually start the operation from FY2018 utilizing this online
qualification confirmation infrastructure, and conduct deliberations on specific systemdesigns etc., to ensure the introduction in a way that people can feel the convenience,
aiming for the full operation by 2020. Moreover, taking into account the examinationof data utilization by the “Next-generation Healthcare ICT Task Force,” theGovernment will conduct deliberations, including necessary institutional measures, forthe digitalization/standardization of data, regional cooperation for medical
information, further data utilization for medical/nursing cares policies, and15

development of the environment for utilization in private sector healthcare businesses.
(3) Developing and commercializing excellent drugs and medical devices made in JapanThe Government will accelerate the development/commercialization of excellent
medical devices based on the needs of medical fronts, utilizing IoT etc., to enable theutilization of the medical diagnosis support system using artificial intelligence within
3 years, etc. Moreover, the Government will conduct deliberations on further
promoting the development and commercialization of innovative drugs etc., which
support pre-emptive medical care by early detection and treatment of illness, andindividualized medical treatments/regenerative medicine therapies according toindividual differences of patients. In addition, in order to strengthen thecompetitiveness in these areas, the Government will consider the development of thenecessary environment, including the support for mobilization of humanresources/technologies/funds and international expansion, and development of
networks for relevant parties, while promoting entry from other industries.
(4) Realizing the “Regional Medical Information Cooperation Corporation” system
With the passing of relevant act in September 2015, there are specific developments
in local areas with an eye for the establishment of a regional medical informationcooperation corporation. While accelerating such developments, the Government willconduct deliberations for identifying and realizing various examples of its utilization
across Japan, aimed at linking them to new developments, including better medical
and nursing cares cooperation in local areas, optimal business operation of medical
institutions, and cooperation with various healthcare services, etc.

2. Expansion of Investment in Energy and Environment
Through the implementation of energy system reforms and the realization of energy
mix, the Government will expand the investment in energy, formulate the “Energy
Innovation Strategy” to realize economic growth and CO2 emission control
simultaneously through the improvement of energy efficiency, and thereby develop newenergy related systems in an integrated way. Moreover, the Government will formulate the“Energy and Environment Innovation Strategy,” identify promising areas to concentrate
for innovative technological development, and strengthen research and development.
(1) Investing thoroughly in energy efficiency
The Government will promote thorough energy efficiency in all sectors, startingwith the expansion of the Energy efficiency benchmark Program, and including the
support for energy efficiency by SMEs and promote effective utilization of waste heatin the industrial sector; energy efficiency of houses and buildings including the
diffusion of ZEHs (Net zero energy houses) in the residential sector; and theinitiatives to introduce autonomous driving and the next generation automobiles in thetransportation sector.
(2) Expanding the introduction of renewable energies
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The Government will review the Feed-in Tariff Scheme for Renewable Energy etc.;
at the same time, it will enhance the introduction of renewable energies by promoting
the development and verification of hydrogen energy storage technologies which willcontribute to reducing system loads.
(3) Developing new energy systems utilizing IoT etc.
The Government will conduct deliberations on developing the regimes for creating
new energy systems, including the establishment of a negawatt trading market where
electric power, saved by utilizing solar power generation and IoT, can be traded.
Moreover, in the midst of on-going new entry into energy markets which are to beliberalized, the Government will conduct deliberations for realizing the system which
requires businesses to improve the efficiency in power generation and lower
carbonization.

3. Manufacturing IoT Revolution and Robot Revolution
Through the activities of the “IoT Acceleration Consortium” etc., the Government
will consider the responses to horizontal issues including regulatory and institutional
reforms in each business, formation of new rules, and distribution of cyber security
data, while creating new business models responding to the Fourth Industrial
Revolution, developing information and telecommunication infrastructure,developing/verifying/making as international standards IoT related technologies,
among others.
While steadily implementing the initiatives to achieve the targets listed in the “NewStrategy for Robots,” the Government will present the whole Japan as a showcase ofrobot utilization by resolving the social issues we are facing ahead of the world
through the realization of daily life with robots in wide-ranging fields. In particular,innovations will be promoted through international competitions and the robot test
field to be developed under the Fukushima Innovation Coast Initiative. In addition, theGovernment will conduct deliberations on developing the environment to encourage
the utilization of robots in wide-ranging fields, starting with the accelerated
introduction of robots by SMEs, and including the development of platform robots,
formulation of the performance evaluation standards with an eye for international
standards, standardization of procedures and skills which will become the bases for thesystem integration function, and development of human resources.

4. Reform of Agriculture, Forestry, and Fishery Industries and Export Promotion(1) Consolidating farmland into large blocks through Public Intermediate Organization for
Farmland Consolidation
The Government will steadily implement the measures based on the “Japan
Revitalization Strategy Revised in 2015” and consider their realization, including
measures to increase/decrease taxation on owned farmlands, and considerations ofvarious policy measures for prefectures which have consolidated farmlands into large
blocks. Moreover, the Government will compile the actual results in FY2015 promptly
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after the end of the fiscal year; and based on their evaluation, will consider measures
for further improvement.
(2) Implementing reform of rice policy steadily
The Government will surely implement the actions for reforming of rice production
adjustment aimed at rice to be produced in 2018; at the same time, while reviewing theexisting policies, it will consider policies which will lead to further initiatives andindependent management.
(3) Improving productivity and utilizing brand power
In order to incorporate in the Growth Strategy a comprehensive package to improve
the productivity in agriculture, forestry, and fishery industries, the Government willconsider specific measures to combine and utilize every expertise in Japan, including
the promotion of development/diffusion of advanced production/distribution systems
utilizing robot technologies and ICT, cooperation with distribution/marketingbusinesses, cost reduction of production materials, development of human resources inagriculture, forestry, and fishery industries with the management sense, and cooperation
between the agricultural sector and business sector including chambers of commerce
and industry.
Moreover, regarding the country-of-origin for materials, the Government willconsider its expansion, while securing the feasibility.
(4) Strengthening the functions of the Agriculture, forestry and fisheries Fund corporation
for Innovation, Value-chain and Expansion Japan (A-FIVE),
The Government will consider the improvement of systems and operations,
including the expansion of investment targets and strengthening of the consulting
function, so that the Agriculture, forestry and fisheries Fund corporation for
Innovation, Value-chain and Expansion Japan can appropriately play its role of an
incubator to support the growth of those in the agriculture, forestry and fisheryindustries.
(5) Promoting exports of agricultural, forestry, and fishery products and foods strategically
The Government will consider specific initiatives to achieve in advance the target ofincreasing the exports of agricultural, forestry, and fishery products and foods to 1
trillion yen in 2020, and to aim for higher targets. In doing so, the Government willconduct deliberations on in-depth initiatives so that nationwide cooperation between
producing areas will be formed , and by also involving distribution businesses, willlead to actual business to build sales networks overseas.
(6) Turning forestry and fishery industries into growth industries
In order to develop systems to produce domestic timber stably at low costs, theGovernment will consider promoting the development of systematic supply systems tobe able to supply timber stably in accordance to the needs on the demand side, and theclarification of forest borders and owners etc. Moreover, in order to improve theprofitability of fishery industry, the Government will consider the initiatives to link18

value chains from production to processing and sales, and the sophistication of
resource management, and so on.
5. Promotion of Tourism Centered on the Increased Acceptance of Foreign Visitors toJapan
Bearing in mind the wide ranging spillover effects and significance of tourism, it isnecessary to promote the tourism with the twin driving forces of “Inbound” and“Domestic tourism,” and thereby proceed with the initiatives to realize Japan as a
Tourism-Oriented Country in a comprehensive and strategic way. Moreover, given that theachievement of the targeted annual number of 20 million foreign visitors to Japan is insight, it is necessary to set a new target; and at the same time, to diffuse and expand
domestic and foreign visitors who are concentrating in specific areas to all over Japan.
From these perspectives, the Government will conduct deliberations on the following,
discuss the issues and additional measures to be taken at the meetings such as the“Tourism Vision Initiative Council to Support Tomorrow’s Japan,” compile a vision for a
new tourism strategy; and at the same time, expand and revise the “Action Program
toward the Realization of Japan as a Tourism-Oriented Country 2015” at the “Ministerial
Council on the Promotion of Japan as a Tourism-Oriented Country.”(1) Preemptively and aggressively improving the tourism environment to accept foreign
visitors
In order to accept rapidly increasing foreign visitors to Japan with perfectpreparations, the Government will classify and sort out the issues for each region
systematically, specify and clarify those responsible and the work plans, andgeneralize advanced practices; at the same time, it will conduct deliberations on thedevelopment of systems to continuously manage the issues and grasp/respond to newissues.
(2) Setting tourism as a key and growth industry
In order to promote establishing the “Japanese version of DMOs” across Japan, theGovernment will rapidly establish excellent practices and provide information on theiractivities, and thereby generalize such practices at the national level, while building
consensus with various relevant parties including the existing tourism promotion
organizations; at the same time, it will rapidly consider specific measures to support
the development of human resources who will lead the initiatives of the “Japaneseversion of DMOs” and to create the mechanism for matching human resources. In
addition, in order to improve the productivity of the tourism industry, the Government
will consider the measures for the utilization of IT, the promotion of the initiatives
such as operational kaizen improvement widely to the level of individual businesses,
and the promotion of big data utilization for marketing and so on.
(3) Developing/disseminating attractive tourism contents/utilizing local resources
including sports and culture
The Government will conduct deliberations to promote the strategic development
and dissemination of attractive tourism contents, including the promotion of the19formation of tourism excursion routes in response to the needs of foreign visitors toJapan, discovery of regional tourism resources taking advantage of the nature,
agricultural products, food, culture, etc., the enhancement of
products/contents/experience-type tourism etc. Moreover, the Government will also
consider specific measures to further increase the spending of foreign visitors to Japan
during their stay, including the utilization of direct overseas delivery procedures which
are to be simplified and the development of cashless environment.

6. Reinforcement of Competitiveness of Medium Core Enterprises and Vitalization and
Productivity Improvement of Service Industries(1) Promoting regional innovations
In order to create innovations from local areas, the Government will conduct
deliberations on strengthening the effective initiatives, starting with global cooperationfrom local areas, and including initiatives to vitalize local areas and develop humanresources with local universities as the core, initiatives to support at the national level
cooperation between regional universities/research institutions and companies,
cooperation between National Research and Development Corporations and publicresearch and development institutions, support for the utilization and standardizationof intellectual properties, comprehensive examinations concerning the dispute
resolution system for intellectual properties.
(2) Creating core enterprises to lead local economies
For the mechanism to continuously create core enterprises which lead local
economies, the Government will consider measures to consistently support thedevelopment of systems to identify and develop candidates for core enterprises, their
R&D, commercialization and development of sales channels. In doing so, regarding
the identification and development of human resources for management support who
are capable of assisting challenges for markets outside the region including abroad, theGovernment will take necessary actions, in cooperation with Town, People, Job
Vitalization Headquarters.
(3) Vitalizing and improving productivity of service industries
While promoting the visualization of the initiatives of individual businesses toimprove the quality in services, the Government will consider necessary legal
frameworks to promote the wide diffusion of best practices which will contribute to
the vitalization of businesses and the improvement of productivity such as theutilization of IT in the businesses of accommodation, transportation (trucks),
restaurants and ready-made-meals, healthcare, nursing care, childcare, wholesale andretail, taking into account their characteristics; and to support the initiatives to vitalize
business and improve productivity by companies etc. through small- and mediumsized enterprise groups, regional financial institutions and others.
(4) Bottoming up systems to support management of local SMEs
While strengthening general support bases, regarding organizations to support
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SMEs, the Government will consider necessary measures to bottom up the systems to
support management of local SMEs, such as promoting the leveling-up of businessadvisors as well as the visualization of individual organizations’ track records ofsupport and fields of expertise, and strengthening the cooperation with general support
bases.
(5) Improving business conditions for subcontractors
In order to realize the expansion of positive cycle of economy through its expansion
to small and medium-sized businesses in local areas and raise of wages, theGovernment will consider necessary measures to improve business conditions of
subcontractors, including thorough implementation and strengthening of the
Subcontract Proceeds Act.
(6) Strengthening financial functions to establish the “earning power” of small andmedium-sized companies
The Government will conduct deliberations on promoting the utilization by smalland medium-sized enterprise groups and local financial institutions of businessindicators and evaluation methods (local benchmarks) which can be referred to forbusiness support etc. to improve productivity of local companies. Moreover, while
paying due consideration to business conditions etc. of small and medium-sizedcompanies as well as taking all possible measures to ensure their financing, theGovernment will make detailed system designs to change the credit guarantee system,so that both financial institutions and businesses will tackle management improvement
and productivity enhancement more vigorously than before, under appropriate risk
sharing by financial institutions and the Credit Guarantee Corporations. In addition,
the Government will consider the measures which contribute to promoting businesssuccession and rehabilitation etc. of small and medium-sized companies in local areas.
(7) Promoting wide diffusion of business continuity plan (BCP)The Government will consider establishing the mechanism in which third parties
will authenticate companies etc. that are engaging in business succession etc. to certain
extent, in order to create a strong and resilient economic society against disasters etc.,
by widely diffusing the business continuity plan (BCP)—to prepare for natural
disasters and other emergencies—not only to large companies but also to SMEs etc.,
and thereby induce investment in disaster-prevention and safety.

7. Expansion of Opening-up of Public Services and Assets to the Private Sector
The Government will accelerate the efforts to realize the numerical targets forconcession PFI projects during the Intensive Implementation Period (from FY2014 toFY2016). Accordingly, it will further consider necessary measures by understanding
issues, taking into account the needs of motivated local governments etc.
In addition, while considering the change to the targets for the project size of thewhole PPP/PFI, for public buildings which have the usage fees for educational
facilities and public housing etc., the Government will conduct deliberations on the21feasibilities of concession PFI projects, and the establishment of new priority fields
and numerical targets within the framework which includes joint establishment andutilization of auxiliary businesses.
Furthermore, the Government will consider measures to utilize PPP/PFI including
concession PFI projects for local and social issues such as tourism promotion anddecreasing population, and endeavor to widely promote the understanding of local
governments and the private sector as well as create the atmosphere, through active
public relations activities and the strengthened cooperation among industry,
government, academia and financial institutions in local areas.

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Ⅳ

Capture of Overseas Growth Markets

1. Support for Overseas Expansion of SMEs upon the Conclusion of TPP
The Government will consider strengthening and enhancing the measures for TPP
utilization to support SMEs in Japan—including local companies which have not beenable to decide on overseas expansion—in participating in global value chains to becreated by TPP and entering huge markets.
Specifically, the Government will conduct deliberations in order to create andfamiliarize, by all-Japan effort, successful cases which have not been created by eachexisting organization by itself, by giving comprehensive support through the“Consortium for New Export Nation” in cooperation with various support
organizations such as the Government, local governments, and JETRO. In doing so,with an eye for expanding virtuous cycle of local economies, the Government will also
consider: the promotion of exports including not only the increase of the
manufacturing goods export but also export including contents and services throughthe cooperation with Cool Japan and Visit Japan initiatives; as well as the creation ofsynergy effects by strengthening cooperation of different industrial fields including
industrial products, agricultural products, food and tourism.

2. Acceleration of Foreign Direct Investment in Japan
In order to further improve the convenience of business and life in Japan, in
addition to the steady implementation of the “Five Promises for Attracting Foreign
Businesses to Japan”, the Government will endeavor to attract foreign direct
investment in Japan upon the conclusion of TPP, through the cooperation between
foreign companies and local SMEs, as well as the development of global humanresources, etc. Moreover, the Government will consider further initiatives in which
Japan and each local area aim to become a global hub (an international core base fortrade and investment).
It is important for local governments—which are the main players to attract
investment—under the leadership of their heads, to promote two-way trade andinvestment with overseas, and realize sustainable economic growth and industrial
vitalization, taking advantage of local attractions and merits.
Accordingly, the Government will consider enhancing the initiatives under which
local governments formulate the strategic policy to attract foreign direct investment,
taking into consideration of local conditions and characteristics—such as the creationof industrial clusters specialized in local strengths, and the attraction of foreigncompanies and research centers through the cooperation of local industry, academia
and government—and accumulate successful cases in cooperation with Japanesediplomatic missions abroad and JETRO overseas offices, etc. identifying, throughtheir overseas networks, overseas companies interested in investment in Japan.
Furthermore, the Government will mitigate local governments’ concerns anddifficulties about attracting foreign direct investment, through the sharing of
successful cases and the experiences. At the same time, while enhancing the support
including the human resource development for local governments’ staff in charge of23

attracting investment, the Government will consider measures to support more local
governments promoting foreign direct investment in Japan aggressively andproactively.

3. Promotion of EPA Negotiations
In order to incorporate global economic growth into local economies, theGovernment will endeavor for the prompt signature and entry into force of TPP
agreement, and will promote strategic and prompt negotiations on other EPAs
including Japan-EU EPA, RCEP, and the Japan-China-Republic of Korea FTA, inorder to conclude comprehensive and high-level EPAs.

4. Expansion of Infrastructure Export
There are increasing opportunities for Japanese companies to receive orders forinfrastructure projects overseas, due to the increased global demand for infrastructurearising from rapid economic development of emerging countries, and opening ofgovernment procurement markets and relaxation of foreign investment restrictions
under TPP, etc. Taking this into account, the Government will appropriately implement
and revise the “Infrastructure Export Strategy”, and conduct deliberations on specificmeasures to ensure the expansion of infrastructure export, including: rapid and steady
implementation of the “Partnership for Quality Infrastructure” announced in May 2015
and its additional specific measures announced in November 2015; sharing among
relevant organizations of the lessons learned from the past projects; development of
human resources to engage in overseas infrastructure projects; and implementation ofstrategic public relations on Japan’s strengths.

5. Promotion of Cool Japan Initiatives
For the industrialization of Japan’s strengths in culture and tradition by promoting
Cool Japan strategy, the Government will consider further promotion of thecooperation beyond borders between the public and private sectors, and those amongindustries, under “Public-Private Partnership Platform for Promotion of Cool Japan”.
Specifically, in order to promote the formation of cooperative projects with highsynergistic and spillover effects utilizing attractive contents and so on, it will conduct
deliberations on the mechanism for the matching of various relevant businesses,
including the measures to strengthen support by Cool Japan Fund.

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V Reform 2020
The “Reform 2020” is an accelerator of reform and innovation, which facilitates themeasures incorporated in the Growth Strategy, using as leverage the Tokyo Olympics andParalympics Games etc.
Given that it is the mechanism to formulate public-private projects incorporatingreforms and measures to facilitate, and to secure the implementation/realization of reforms
by implementing/realizing them, it is extremely important to strictly manage the progressof projects.
Since the time for its preparation is very short if we aim to make projects as showcasesin 2020, it is essential to identify the venues to make projects as showcases, and decide on
project implementing bodies in a responsible and quick way. Accordingly, the Government
will in principle implement them by the end of FY2016 at the latest, sorting out the issues
and conditions to solve for them at the same time.
On the other hand, the “Reform 2020” does not solely aim to make showcases in 2020:
Making showcases is merely a trigger to proceed with reform and innovation including
after 2020 as well. It will become the legacy to be inherited by the later generations if
reform and innovation in Japan solve global agenda, and at the same time we appeal tooverseas that they lead to growth in Japan. From this perspective, the Government willcontinue checking the initiatives and directions of individual projects uninterruptedly up
to 2020 and with an eye for after that, and increase the momentum for reform, including
the examination of necessary regulatory and institutional reforms.
<List of Reform 2020 Projects>(Resolution of social issues utilizing technologies etc./ system solutions export）
1) Next-generation city transportation systems/utilization of automatic driving
technologies
2) Resolution of energy/environmental issues by utilizing distributed energy sources
3) Realization of universal future society by leading0edge robotic technologies
4) International expansion of high-quality Japanese healthcare services/technologies(Healthcare inbound)(Development of the environment to increase foreign visitors to Japan etc.)
5) Showcasing Japan as a country of tourism(Increase of foreign direct investment in Japan and improvement/enhancement ofbusiness conditions)6) Measures to attract more foreign direct investment in Japan

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