Provisional

Chapter 2 Concrete measures
I Strategic fields aiming for the achievement of Society 5.0
1. Health, Medical and Nursing Care
(1) Main progress status of KPI《KPI》Extending the healthy life expectancy of the people by 1 year or more by 2020,
and also extending further 2 years or more by 2025 [Male 70.42 years old, Female
73.62 years old (as at 2010)]=> As at 2013: Male 71.19 years old, Female 74.21 years old(2) Specific measures to be newly taken
The government will work on the establishment of a new health, medical care and nursing
care system that include nursing care with a focus on the optimal health care, medical treatment,
and support for independence from the viewpoint of individuals and patients by maximizing theutilization of technological innovation in time for the "2025 Problem" where all baby-boom
generations reach 75 years old or higher. The government will also work on the establishment ofa data utilization infrastructure in the entire nation so as to realize the extension of healthy life
expectancy and independent living of elderly people by providing highly effective services
tailored to the condition of individuals. Further, the government will build a model which is ofhigh quality and enables the efficient provision of health, medical care and nursing care services
even facing the aging population and population decline while increasing the productivity of thesite by combining AI, robots, and the like. In order to support such mechanisms, the government
will promote effective private service development and dissemination, at the same timeadvancing the development and commercialization of excellent pharmaceuticals and medical
devices originating in Japan. In this way, while taking cost-effectiveness into consideration, thegovernment will integrally advance infrastructure building, system reform and private
investment promotion with an aim at establishing a new system in 2020, and also ensure that the
medical care and nursing care that make citizens feel secure will have been permeated in 2025.
Moving forward, such health, medical care and nursing care services will be required invarious countries around the world. The government aims at gaining global market and making
an international contribution by promptly creating a problem-solving model for Japan that is
facing challenges faster than other countries.
i)

Building a new health, medical care and nursing care system with a focus on healthmanagement, disease and long-term care prevention and independence support by utilizing
technological innovation① Establishment of Data-Using Base
• The government will develop "National Health and Medical Information Network" asinfrastructure for providing optimum health management, medical treatment and care from theviewpoint of individuals and patients. The said network is made up of a "health and medical
record sharing service" that enables sharing of patient basic information, medical examination
information, etc. with the medical institution upon an initial outpatient visit to such medical

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institution under the consent of the patient and "medical information sharing service at the timeof emergency" that allows utilization of basic information on the patient at the time of
emergency, with an aim that the said network makes it possible for the patient to view such
medical history information throughout his entire life through PHR (Personal Health Record)using his own terminal. Aiming at the full-fledged operation in 2020, the government will study
specific system structures while beginning demonstration projects by the end of this fiscal year,
and begin detailed designing next fiscal year or later.
• Of the "National Health and Medical Information Network", with respect to establishing a
network of medical care and nursing care providers, the government will advance thesophistication of regional EHR (Electronic Health Record) through cloud computing,bi-directionalization, etc., at the same time conducting demonstrations regarding methods ofwide area cooperation (security measures, etc.) and also methods of obtaining consents of thepatient utilizing the My Number Card System, etc., by the end of this fiscal year. With respect
to PHR, the government will construct a service model by next fiscal year to allow various
kinds of utilization of not only EHR information, but also data owned by diverse entities suchas insurers, etc., according to the person's life stage, incorporating private services. With theaim of establishing effective lifestyle disease prevention services by collecting daily healthinformation using IoT devices such as wearable terminals, in particular, the government will
begin more strict verifications on the effectiveness this fiscal year for a period of 3 years basedon the previous verification results conducted until the last fiscal year. The government will
also work on the creation and further sophistication of new health information utilization
services conducted by private companies by developing AI algorithms that utilize healthinformation gathered through such projects.
• In order to allow researchers, private companies, insurers, etc. to link and analyze health,
medical care and nursing care big data as personal history, the government will develop a"Health Care Data Platform". The government will make it possible to analyze existing public
databases such as NDB (National Data Base) of health insurance claims and specific healthcheckup information, long term care insurance comprehensive database of long-term careinsurance information, DPC Database, etc. together with other databases on the said platform.
Aiming at the full-fledged operation in fiscal year 2020, the government will study specificsystem structures while beginning demonstration projects by the end of this fiscal year, andbegin detailed designing next fiscal year or later.
• The government will advance the utilization of medical information that has been processed to
be anonymous personal information in the development and research by the medical field byutilizing accredited operators based on the Act on the Next-Generation Medical Infrastructure
established in April this year. The above-mentioned "Health and Medical Data Platform" will
provide all-in-one information based on public databases, while accredited business operators
under the act will collect and provide data using any mechanism that meet various needs ofresearch and development in the medical field including the treatment outcome information.
• The systems of online qualification check of medical insurance and medical IDs will be the basisthat supports the above, which we aim at introducing. With an aim of launching a step-by-step
operation next fiscal year and full-scale operation in 2020, we will surely start developing thesystems this fiscal year.
• With regard to the initiatives to thoroughly digitize and standardize data in the fields of health,50

medical care and nursing care, the government will accelerate studying of concrete measures
including the scope of data to be standardized and approaches for standardization, to allow datautilization entities to smoothly share and make secondary use of data while taking the progressof technology into consideration so as to be in time for the full-scale operation of the datautilization infrastructure in FY 2020. After implementing such measures, the government willtake necessary measures again, taking into account of the progress of technology thereafter.
② Strengthening of disease prevention and health promotion of individuals using data
conducted by national insurance scheme operators and business operators• The government will strengthen incentives for national insurance scheme operators to promote
their initiatives to encourage subscribers' behavioral change toward disease prevention, healthpromotion, etc. Regarding the Health Insurance Cooperatives and the Mutual Aid Association,
for the addition / subtraction system of the latter-stage elderly support fund, both the addition
and the subtraction rates will be gradually increased beginning the next fiscal year and will be
increased to 10% in FY 2020 at the highest, which is the statutory upper limit. Regarding theJapan Health Insurance Association, the incentive system will be fully implemented next fiscal
year, which will be reflected in the prefectural unit premium rate in FY 2020. For the National
Health Insurance System, the Insurer Effort Support System will be fully implemented next
fiscal year. In respect of the indicators that are common to all the schemes, the government will
evaluate diversified efforts that contribute to the optimization of medical expenses such as
disease prevention and health promotion initiatives in a well-balanced manner by including
implementation status of cancer examination and dental checkup, providing the patients witheasy-to-understand information on the health check-up result making use of ICT and the like, in
addition to the implementation rates of specified health checkup / specified health guidance.
Further, in order to clarify the responsibilities of health insurance scheme operators, thegovernment will start publishing the implementation rates of specified health checkups /specific health guidance beginning this fiscal year and strengthen the disclosure.
• In order to strengthen initiatives by health insurance scheme operators to exert their functions,the government will develop a joint implementation model and so on, to encouragereorganization of health businesses through centralization of insurer functions so as to promote
the utilization of outsourcing and private businesses.
• The government will develop an environment so as to achieve Data Health effectively through asystem capable of cross-sectionally managing information on subscribers who join a healthinsurance scheme such as the Health Insurance Association, Mutual Aid Association, Japan
Health Insurance Association, National Health Insurance, etc., by integrating data owned bysuch national insurance operators so that even if a subscriber changes his national insurance
scheme to another scheme, his data will be transferred to the new national insurance operator
and the Data Health will be conducted effectively.
• The government will conduct concrete verification of models in which public health nurses inlocal governments analyze data, including data on medical examination, health insurance claim,etc. using AI, and formulate health guidance measures so that they could perform Data Healthefficiently.
• The government will strengthen the Data Health conducted by national insurance scheme

51

operators and promote collaboration between corporate health (collaboration health). To
achieve this, the Ministry of Health, Labour, and Welfare and the Nippon Kenko Kaigi will
work together and assess the statuses including subscribers' health condition, medical expenses,
investment for maintaining health, etc. and notify such results to the business operators
beginning next year. Similar measures will be developed by other health insurance scheme
operators, including the Mutual Aid Association so that business operators could objectively
understand the situation of their health insurance scheme in comparison with the situation of thewhole country before engaging in health improvement in cooperation with the health insurance
scheme organization.
• The government will work on the improvement of the quality and further dissemination of healthand productivity management by expanding accreditation of the Health and Productivity Stock
Selection and the Certified Health and the Productivity Management Organization, at the sametime reviewing necessary evaluation items taking into account of the reform of working method,etc.
③ Medical caremaking use of ICT such as remote medical care, AI and the like, andgenome information, etc.
• The government will evaluate remote medical treatment at the next medical service fee revision,for example, those contribute to the provision of effective and efficient medical care byproperly combining face-to-face medical treatment and remote medical treatment, including theeffective guidance and management to lifestyle diseases patients such as diabetes combinedwith on-line consultation, early prevention of aggravation utilizing remote monitoring of bloodpressure, blood glucose level, etc. Further, the government will accumulate knowledge on theeffectiveness, safety, etc., which will also be reflected in the revisions made after FY 2020. As
for remote medicine administration guidance, the government will study it based on thedemonstration and the like conducted in the National Special Strategy Zone.
• In order to strategically promote development of AI such as deep learning and machine learningin the field of healthcare, we have designated the following 6 areas to focus on promotion ofdevelopment and practical application: diagnostic imaging support, development of drugs,
support on operations, genomic medicine, support on medical care and treatment, and nursing
care/dementia. The government will establish a mechanism for developing and certifying cloudenvironments for AI development, at the same time developing rules on evaluation methods toensure the quality and safety of medical equipment utilizing AI aiming for practical application.
Based on these, we aim at evaluating, at the time of amendment of medical treatment fee that
follows, the improvement of the quality of medical treatment and the like through appropriate
support using AI to the medical treatment of doctors.
• The government will develop a genomic medical provision framework in the areas of cancer,
intractable diseases and rare diseases. Regarding cancer, the government will develop AI
infrastructure to aggregate and analyze information on genome mutation and therapeutic effects,
etc., and also develop a framework for nationwide support (building a consortium) so that
medical stakeholders and the like could conduct treatment making use of AI and information
technology. In addition, the government will conduct measures, that include the expansion of
the scope of pharmaceuticals through conditional early approval, at the same time permitting52

insurance coverage of pharmaceuticals after verifying the effectiveness, safety, etc. of such
pharmaceuticals, etc. so that each patient could receive the most advanced cancer treatment best
suited for each person covered by public medical insurance. Furthermore, the government will
advance the development of innovative treatment methods using whole genome analysis or
immunological related tests, minimally invasive diagnostic technology and ultra-early diagnosis
technology using liquid biopsy etc. Regarding intractable diseases, the government will
advance the development of a framework for centrally managing research data, such as genome
analysis information and clinical information, achieving early diagnosis and promoting drug
discovery.
• The government will study medical modules required in disaster affected areas, taking an
opportunity of medical activity drills prior to constructing a framework for transporting
severely ill patients to the outside of the disaster area for treatment, otherwise it had beendifficult to provide proper treatment in the event of a disaster.
④ Realization of scientific care for the independence support and prevention of
aggravation• At the next amendment of care payment , we will evaluate the effective self-support.
• The government will build a database to collect and analyze necessary data to clarify what kindof support is given to what kind of condition for achieving independence, aiming at therealization of nursing care in which the effect of the independence support is scientificallysupported. The government will prepare a data collection format, such as care classification
method during this fiscal year, start building a database in the next fiscal year, launch trial
operation in FY 2019, aim for the full-scale operation in FY 2020.
• With respect to the nursing care services the scientific effect of which is supported by analyzing
data, we will evaluate them at the time of amendment of care payment in or after FY 2021.
Further, we will publish on the website of the Ministry of Health, Labour, and Welfare thecompanies which offer such services, so that the services will be “visualized” to the citizens.
⑤ Improvement of the quality and productivity of nursing care by utilizing technologies
such as robots and sensors• The government will steadily advance the demonstrations of the effectiveness of utilization ofrobots, sensors and the like at nursing care sites, then based on the demonstration results, takemeasures in the aspect of institution such as reviewing care payment, personnel/equipment
criteria, and other matters in respect of the robots and sensors that are found to contribute to themaintenance and improvement of the quality of living of users and also the reduction of theburden on caregivers at the time of the care payment revision for the next term.
• In our future development of nursing care robots, our goals are to maintain and improve thequality of life of users through self-support and at the same time to reduce burden of caretakers.
We will thus newly cultivate and assign project coordinators who can truly pick up the on-siteneeds, turn them into development seeds and lead the projects. Also, We will re-examine thedevelopment fields to be focused on for the robot nursing care equipment, decide the directionof our strategic development by this summer, and reflect it to the development support goal forthe next fiscal year and on. The government also support in the evaluation and test data53

acquisition for advancing coordination between ISO13482, which is the standard concerning
the safety of the day-to-day living support robots and the overseas systems, so as to smoothly
develop an overseas robot nursing equipment market.
• In order to reduce the burden on nursing staff, the government will work towards halving theamount of documents required by the administration and strengthen initiatives for the
dissemination of ICT in nursing care records. In addition, the government will comprehensively
work on the securing of diversified nursing care workers, including steady implementation of
initiatives for the improvement of treatment of such workers, and utilization of loan programswith exemption from repayment. The government will also provide support in creating careplans using AI, including organizing issues of practical application.
ii) Promotion of initiatives to maintain and promote health in collaboration with industry,
academia and government• In order to realize a "lifelong active society" where people can continue to live as who they
really are, even at an old age, the government will create a place, role and work for the elderly,
prevent the situations that cause people to require care and also prevent the progress thereofthrough a collected effort of various actors including medical and nursing-related persons,universities, private enterprises, local governments and other entities. For example, thegovernment will implement a demonstration project on "Homes with jobs for the elderly"(tentative name) etc. and work on the development of a model case that is found effective in
medically and scientifically aiming for the prevention of dementia and situations in need of careand control the progress of thereof.
• In order to reevaluate the correlation between the aging process and age, the government willorganize the knowledge and data accumulated so far, categorize deterioration of living
functions and cognitive functions in accordance with the level of aging, which will be used forthe support for prevention, treatment, social participation, etc.
• To utilize the vitality of private companies in solving social issues, the government will expand
social impact investment efforts, such as the social impact bonds that invoke private funds andimplement pay-per-performance based outsourcing projects in the health and welfare areas. For
this purpose, the government will develop an environment, which include setting of evaluation
indicators through the implementation of model projects and provide support to local
government in their formation of projects. Also, the government will verify and organize theissues and activities of each administrative agency, financial institution and business operator
based on the past cases.
iii) Development and commercialization of outstanding pharmaceuticals and medical devices
originating in Japan• Based on the "Health / Medical Strategy" (Cabinet decision on July 22, 2014, Partly revised on
February 17, 2017) and the like, the government will advance research and development aiming
at the creation of innovative pharmaceuticals and medical devices originating in Japan byconducting seamless research management and support from basic research through practicalapplication in an integral manner at the Japan Agency for Medical Research and Development(AMED).

54• The government will advance the creation of innovative pharmaceuticals and products related toregenerative medicine that achieve both prolonging of healthy life expectancy/improving
patient QOL and generating medical economic value. Specifically, in addition to developing
drug discovery technology, making use of state-of-the-art biotechnology, AI technology andother technologies, the government will form a national consortium to promote thedevelopment of methods of evaluation of the safety of potential drugs that use regenerative
medicine technology and the practical application of regenerative medicine, and advance
medical applications through integration of regenerative medicine and rehabilitation technology.
In this way, the government will build a highly competitive medical industry by supporting
practical application of Japan's excellent technological seeds.
• The government will also advance the research and development of biomarkers and risk markers
that allow symptoms of lifestyle diseases and dementia to be detected, at the same time
verifying the usefulness of the biomarkers developed. The government will also advance theresearch and development of pharmaceuticals and other items that are expected to be utilized
for the prevention of lifestyle diseases and dementia.
• In order to support the development of innovative medical devices and systems that incorporate
technological innovation such as ICT through entries of different industries, the government
will develop an environment for supporting the development, such as enhancement of a medical
equipment development support network, collaboration with clinical sites and related academic
societies. The government will also propose methods of evaluating innovative medical
equipment and products related to regenerative medicine, etc., ahead of the rest of the world
aiming at gaining international standards.
• The government will conduct research aiming for the practical application of high definition
video technology such as 8K to endoscopes and diagnostic support systems.
• The government will develop an environment for efficient clinical development through theestablishment of "Clinical Innovation Network" where networking of the disease registration
systems and other systems developed by the National Center for Advanced Medical ResearchCenter (NC), academic societies and other organizations is implemented, and also anenvironment to improve the sophistication of evaluation of pharmaceuticals and the safetymeasures through the development of PMDA's Medical Information Database System(MID-NET).
• In order to expedite the practical application of innovative pharmaceuticals, the government will
examine a conditional early approval system, taking into account of the utilization of real world
data and the like.
• The government will enhance comprehensive support such as securing human resources
equipped with the expertise on pharmaceutical regulatory affairs, intellectual property and othermatters in order to develop an environment where medical venture businesses are easy to startup.
iv) Gaining global market share and international contribution• In respect of outbound promotion, of the initiatives for international expansion of medical careand nursing care, the government will provide support to Japan-based medical institutions intheir expansion into overseas while utilizing Medical Excellence Japan (MEJ), the Japan
External Trade Organization (JETRO) and other organizations, also support for the effective55

medical and nursing care services in each country in which human resource development andinstitutional development are combined as a package, support for the development of sales
channels and the formation of projects for medical equipment and pharmaceuticals, etc.,
support for the development of medical equipment aiming at solving health and medical
problems of partner countries based on the needs of developing countries etc. The government
will also advance the establishment and enhancement of a maintenance framework of medical
device manufacturers overseas.
• In respect of the promotion of medical inbound tourism, the government will accelerate thedevelopment of 100 "Medical institutions where a framework of the provision of medical
services to foreign patients has been developed" that covers check-in process by the end of thisfiscal year from original target of year 2020, through the support in assigning medical
interpreters, so that visiting foreigners and foreign residents could visit medical institutions inJapan feeling safe and secure. In addition to the development of such core medical institutions,the government will work on the expansion of the foundation of the foreign patient acceptanceframework taking into consideration of the regional situations aiming for the further
enhancement of the acceptance environment. In addition, as part of the "Reform 2020" project,
the government will continue developing necessary environments, including the quality
improvement of coordinators who assist foreigners in their smooth visits to Japan and medical
consultation and the development of overseas liaison offices while improving the awareness ofJapan International Hospitals (JIH) among foreign countries, that was announced on January 31
this year.
• Based on the "Basic Policy for Asia Health and Human Well-Being Initiative" (Decision of
Headquarters for Health Care Policy on July 29, 2016), the government will introduce Japan's
knowledge and experiences of various policies and measures targeting the elderly cultivated byour country such as disease prevention, rehabilitation, independence support, etc., in
accordance with the actual situation and needs of Asian countries, aiming at establishing a new
UHC (Universal Health Coverage) model suitable for Asia. The government will provide
support to private enterprises in their business expansion into Asian countries, and also advancethe development and circulation of highly skilled nursing human resources in Asia bypromoting Japanese language education infrastructure improvement for nursing care personnel
and strengthening cooperation with the home countries of foreign human resources.
Based on the "Basic Plan for Strengthening International Threatening Infectious Disease
Control Measures" (February 9, 2016, decision of ministerial conference on International
Threatening Infectious Disease Control Measures), etc., the government will advanceinternational collaboration related to the provision of Japan's pharmaceuticals to developing
countries in a collected effort of government and private enterprises, strengthening researchcapabilities and functions through the formation of infectious disease research bases with
Nagasaki University's highly safe test facility as a core, and the expansion and enhancement ofdesignated medical institutions. The government will provide assistance to international healthorganizations such as the World Health Organization (WHO) and the "the Global Fund to fightAIDS, Tuberculosis and Malaria ", the Global Health Innovative Technology Fund (GHIT
Fund) that promotes the development and dissemination of necessary medicines in developing
countries, and also in the international vaccine development initiatives, at the same time
promoting measures againstAntimicrobial resistance (AMR), which has become an important

56

international challenge. In addition, the government will strengthen training of human resourcesand dispatch of personnel to international organizations in order to demonstrate Japan's
presence in the international health field.

57

2. Further sophistication of mobility services, elimination of "Mobility vulnerable people",realization of logistics revolution(1)
Main progress status of KPI《KPI》In 2020, Automatic braking on more than 90% of bland-new passenger cars sold in
Japan=> Bland-new passenger cars sold in Japan with automatic braking: 45.4% (in 2015)* KPI that we will freshly set up this time
《KPI》In 2020, Driving assistance device/system on 20% of domestic vehicles (stock base),
gaining 30% of the world market share=> Domestic vehicles with driving assistance system:

6.5% (in 2015)

Alternative value of world market share: 40.5% (in 2014)《 KPI》In 2030, Driving assistance device/system originally mounted
on all bland-new cars sold in Japan, and even in stock base, it permeates almost allcars=> Bland-new cars sold in Japan with automatic braking: 42.2% (in 2015)
Domestic vehicle : 6.5% (in 2015)(2)

Specific measures to be newly taken
Regarding the movement of people and goods, Japan is a facing declining population on a fullscale and the production age population is expected to decline. Amid the situation, sustaining
regional public transportation network, addressing the labor shortage of the logistics field that has
become increasing serious, reducing traffic accidents and other issues are urgent challenges thatJapan must work on. In order to strengthen the industrial competitiveness while addressing thesesocial issues, the government will strongly advance initiatives, including institutional
development, technology development, demonstration environment development, and others withclear deadlines thereof, while visualizing a specific business model, aiming at realizing mobility
services utilizing unmanned automated driving technology ahead of the rest of the world andincorporate such services into society.
As a basic approach to incorporating such services into society, the government aims at theworld's most advanced automated driving system in terms of both tangible and intangible, namely"technology" and "commercialization", however, in the meantime, the government will begin
incorporating the automated driving system from time to time into society by taking advantage ofthe latest technology at the time while complementing with the institutions and infrastructure
without waiting for the technology to be completely established. Initially, the government will
begin with a relatively simple location, such as a private space or a mountainous area, and then
expand to a complex location, such as an urban public road while accumulating concrete examples
so that a safe and secure practical application can be attained while increasing the level oftechnology and social acceptability.

58

To do so, first of all, the government will advance the development of the necessary institutions
and infrastructure by clarifying the deadlines so that a new stage of public road demonstration of
unmanned remote driving or platooning of trucks could be smoothly and promptly conducted
while visualizing more concrete business models, based on the implementation plan summarizedat the Future Investment Conference in February this year. In doing so, the government will
advance the development of necessary institutions under the collaboration framework where
public and private entities actively engage in dialogue and work together while firmly sharing thedemonstration results and data among stakeholders. Also, in order to create a market andintroduce services of advanced automated driving in the future, it is necessary to review theexisting traffic related laws and regulations that are established on the premise of "driving bydrivers". For the reason, the government will advance a full-fledged study of institutional
development and so on, aiming for the commercialization of advanced automated driving around
2020, with an eye to international institutional competition. Furthermore, in order to accelerate thetechnology development, such as reinforcement of the recognition and judgment technology,
which is the core technology of automated driving, the government will deepen and expand thescope of the cooperation areas where business operators strategically work on, such as creating areal data platform, while promoting the sharing and utilization of data. • The government will
work for the realization thereof in a collected effort from government and private sectors as anational strategy while working on the strengthening of the government's commander tower
function. In order to advance the development of an environment for institutions andinfrastructure and the research and development in a comprehensive and systematic manner, the"Public-Private ITS Concept/Road Map 2017" (May 30, 2017, Decision of IT Comprehensive
Strategy Headquarters, Public-Private Data Utilization Promotion Strategy Meeting) needs to beadvanced by the entire government.
In addition to autonomous driving on land, the government will also actively work on
automation in air routes and sea routes aiming for the improvement of logistics efficiency andsophistication of mobility services. To do so, the government will expand the industrial use of
unmanned aerial vehicles (Drones) for package delivery and other purposes, and also takeinitiatives to advance the sophistication of maritime traffic through research and development ordevelopment of standards and rules, also to incorporate "automated ship operation" into society.
i)

Smooth and prompt promotion of demonstration projects• We aim to commercialize truck driving in convoy on freeways in 2022 at the earliest. In order torealize unmanned convoy driving for vehicles that follow on freeway (Shin-tomei) in 2020, we
will launch experiments of manned-following-vehicle system during this fiscal year andunmanned-following-vehicle system next fiscal year on public roads. During this fiscal year,
the government will study matters related to the distance between vehicles to ensure the safety
aiming at a public road demonstration, and determine specific driving locations and driving
methods to develop a driving plan. In addition, taking into consideration of the test situation ofarticulated trucks, the government will study business environments in the aspect of
infrastructure and the like according to the technology used for platooning, the results ofdemonstrations, operational rules and so on.
• Aiming at the realization of a mobility service by unmanned automated driving in 2020, thegovernment will conduct regional public road demonstrations (including those by remote

59operation) at 10 or more locations nationwide, such as michi-no-eki (Roadside stations). To
do this, the government will develop necessary institutions, including setting of requirement for
dedicated space and determining of concrete driving methods during this fiscal year.
• With an eye to the Tokyo Olympic Games and the Paralympic Games to be held in 2020, which
the government intend to use to showcase and disseminate the Japan's state-of-the-art
automated driving technology both to Japan and the world, and also make it a legacy, thegovernment will conduct state-of-the-art demonstrations for remote operation or completely
automated driving by utilizing the National Strategy Special Zone, etc., such as the Haneda
Airport and coastal areas. The government will develop necessary institutions and infrastructure
by 2019 so that a demonstration aiming at commercialization becomes possible.
• In order to advance such demonstration safely, smoothly, and promptly, the government will
advance the utilization of the national strategic special zones at the same time studying andutilizing mechanism of the "Sandbox" system, which is a regulation to fundamentally review
relevant preliminary regulations and procedures in the special zones, while working closelywith related local governments and other organizations. (For details, see "II-B-5 Bold
Regulatory Reform by the National automated drive Special Zone".)• The government will advance process management of demonstration projects based on the needsof private enterprises, sharing of demonstration results and data and the development ofnecessary institutions under the framework of public and private partnership where public andprivate people actively interact and cooperate while sharing the results and data of
demonstration conducted in various driving environments. By the end of the year, we will
establish systems for the sharing and collection of information. This includes indexing ofcomplexity of driving environment and clarification of experiment data that needs to becollected in common.
ii) Acceleration of the development of institutions aiming at realizing advanced automateddriving• Regarding the review of traffic related laws and regulations that are necessary for theadvancement of marketing and creation of services of advanced automated driving in the future,
the government will accelerate discussions related to institutional development with an
anticipation of international institutional competition and discussions related to international
treaties aiming at achieving the marketing and servitization of advanced automated driving(Level 3 or higher) that includes complete automated driving by around 2020, and summarize
the policy (outline) of institutional development relevant to the entire government during thisfiscal year.
iii) Advancement of technology development and deepening/ expansion of collaborationareas① Strategic utilization of driving video data, accident data and other data
• In order to drastically strengthen the competitiveness of the recognition and judgment
technology, which holds the key to the success of automated driving, the government will
accelerate the research and development, and compile the basic policy on strategic collection
and utilization of driving video data, accident data, etc., which help accelerate the development60

of the technology during this fiscal year, from the viewpoint of advancing the development andutilization of high-quality data associated with safety evaluation.
② Practical application of automated driving maps, etc.
• In respect of automated driving maps, the government will unify the specifications beyond theboundaries of companies and advance the development of map-related data by public-private
cooperation. In respect of highway maps, the government will advance international
collaboration with a view of overseas expansion, aiming at practical application next fiscal year.
Regarding general road maps, the government will decide a development policy next fiscal
year.
• The government will study specifications, mechanisms and methods of utilizing probe
information for dynamic maps, which use automated driving maps as its foundation on which
information that changes in real time is linked, then, compile them next fiscal year.
③ Realization and utilization of the 5th Generation Mobile Communication System (5G)
• The government will advance the initiatives aiming at launching services of the 5th Generation
Mobile Communication System (5G) by 2020, which enables ultra-high speed, multiple
connections, and ultra-low latency, as part of initiatives to develop information communication
infrastructure that contributes to incorporating automated driving and other technologies into
society. (For details, see "II-A-1. Construction of data utilization infrastructure" herein
below.)④ Securing of in-vehicle security• In respect of in-vehicle security that ensures the safety of automated driving, such as measuresagainst cyber-attacks posed from the outside of the vehicle, the government will compile aprocess chart for promoting internationally common development processes and safety
evaluation mechanism during this fiscal year, at the same time accelerating public and private
partnership efforts including human resource development.
⑤ Training of human resources specialized in software• In order to secure human resources specialized in software necessary for the development of
automated driving, the government will develop a framework of human resource development
to foster personnel who is familiar with simulations and development of innovative automotive
software by the end of this fiscal year while summarizing competencies necessary for thedevelopment.
⑥ Promotion of popularization of safe driving support vehicles• In consideration of urgent issues such as taking measures against traffic accidents by elderly
drivers, the government will study about the expansion and enhancement of the evaluation of
the safety performance of automobiles and the development of standards for advanced safety
technology, at the same time promoting the spread of automobiles equipped with advanced
safety technology.

61iv) Development of an environment for the expansion of industrial use of small unmanned
aerial vehicles (drone) and the like
• In respect of small unmanned aerial vehicles, the government will implement baggage delivery
next year in areas such as mountainous areas where such needs are expected to be generated.
The government will also advance the development of technology and institutions that enableadvanced flights such as BVLOS (Beyond Visual Line of Sight) Flight that doesn't requireassistants and flights over third parties aiming at implementing baggage delivery on a full scalein highly populated cities in the 2020s. Through the utilization of the demonstration field
located in the Fukushima Hama-Street area, the government will formulate performance
evaluation criteria of aircrafts, and advance the development of flight management systems,
collision avoidance technology and the like that enable simultaneous flights of multiple
aircrafts, and also advance the international standardization. The government will also conduct
research and study with regard to the use of radio waves for the realization of BVLOS (Beyond
Visual Line of Sight) flights, taking into consideration of the progress of the flight rules andtechnology development of small unmanned aircraft In addition, the government will clarify therequirements of the aircraft and pilots, etc., concerning BVLOS (Beyond Visual Line of Sight)
Flight that doesn't require assistants by the end of this fiscal year, revise the examination
guidelines for permits and approvals based on the Civil Aeronautics Act early next year, andconsider streamlining of the application procedure by utilizing the Council that is working on
the formation of agreements with stakeholders and the formulation of safety measures. In thisway, through the utilization of robot technology such as small unmanned aerial vehicles, thegovernment will expand industrial applications for improving logistical efficiency and so on.
v) Sophistication of marine logistics by incorporating automated cargo vessels into society• Aiming for the practical application of "automated cargo vessels" by 2025, the government will
work on aiming to reach an agreement on international standards concerning ship's equipment
and operation, etc. by the end of FY 2023 and also improve domestic standards. For thesereasons, as elemental technologies that form the basis of the above-mentioned standards, thegovernment will formulate international standards relating to data transmission of inboard
equipment and the like at the initiative of Japan next fiscal year, and also aim at introducing
approximately 250 advanced vessels that utilize state-of-the-art data transmission technology to
improve the operation efficiency by 2025 based on the revised Marine Transportation Act.

62

3. Realization of the world's first smart supply chain(1)
Main progress status of KPI《 KPI》 More than 2% annual improvement in labor productivity of manufacturingindustry=>The average growth rate for the most recent 3 years (2013 - 2015): 1.4%
《KPI》80% of companies collect data at their factories and other establishments by 2020,
40% of companies link the collected data to solving concrete management issues=>In 2016: 67% and 20% respectively* KPI that we will freshly set up this time(2)

Specific measures to be newly taken
With the advent of a population declining society, Japan has structural problems in bothsupply and demand. Under these circumstances, the source of added value is shifting from"things" to "services" and "solutions" at an accelerated speed. The government must make thissituation a great opportunity to connect diverse needs of consumers and customers to theblooming of potential demand, and dramatically increase the productivity of the sites.
In the 4th Industrial Revolution, the vision of Japan's industry is to materialize "Connected
Industries", that is, an industrial society in which various things are networked by IoT and thelike and new value added is created that contribute to solving problems of customers and thesociety while taking advantage of Japan's strengths as much as possible, such as flexible
problem-solving capability supported by a high level of technological capability and on-siteknowledge. The technological innovation of the 4th Industrial Revolution will make it possible
to obtain and utilize data of all stages of development, manufacturing, sales and consumption inreal time. The government will aim for the realization of creation of innovative products andservices that meet the needs of individual customers, an optimized supply chain without waste
through data coordination, and a safe and highly productive manufacturing process.
While Japan has the potential to acquire and utilize abundant data due to the worldwide highmarket share of individual equipment and final products of manufacturing industry. On the other
hand, the current situation is that inter-equipment and intra-company data coordination amonglarge companies has slowly progressed, but data coordination beyond the boundaries of factories
and companies has not been initiated yet. Inter-equipment and inter-company data coordination
has not been progressed among many SMEs. In order to connect such potential capabilities tothe competitive strength, the government will accelerate the data coordination throughout the
supply chain beyond the boundaries of factories and companies, at the same time advancing theseparation of competitive and cooperative areas in respect of data, then develop a platform forreal data in the cooperative areas.
Therefore, the government will make the following efforts to create advanced exemplarycases of data coordination beyond the boundaries of companies, to achieve international
standardization thereof and also to develop institutions and rules to advance the data
coordination and utilization.

63i) Creation of advanced exemplary cases and international standardization of data
coordination• The government will advance the creation and dissemination of advanced exemplary cases ofdata coordination such as order placing and receiving, designing, production, logistics, sales,
consumption and maintenance, etc., beyond the boundaries of companies, including SMEs. For
this reason, the government will begin international demonstrations across domestic andoverseas companies on the supply chain this fiscal year, in addition to domestic demonstrations.
The government will formulate a uniform data description format (data profile) based on theseoutcomes by the end of this fiscal year, which will be connected to proposals of international
standards by 2020.
• The government will provide expert support for IT and robot introduction to more than 10,000
companies by the end of this fiscal year, aiming at the creation of new services and added value
using data from SMB and SME in manufacturing industry. The government will also
encourage initiatives to develop bases that allow businesses to receive consultation from the"Smart Manufacturing Support Team", which provides consultation on the improvement of
manufacturing sites and also provide assistance in the utilization and introduction of IoT/robots,with an aim at setting up such bases at about 40 locations nationwide within two years. In
addition, the government will promote measures to strengthen training in its effort to double
the number of "system integrator" that proposes and supports SMEs in their robot introduction
to 30,000 by 2020.
• The government will advance the sophistication of the integrative process (“suriawase” inJapanese), which is strength of Japan, throughout the supply chain by utilizing digital technology.
First, the government will aim at the establishment of a simulation model for vehicle
performance evaluation in the automotive field in a collected effort from industry-academia.
• In order to promote the acquisition of digital skills by manufacturing human resources that
support the realization of Smart Supply Chain, the government will formulate a practicalcurriculum during the current fiscal year. In doing so, the government will also collaborate withindustry and academia in Germany, which shares the strengths in manufacturing with Japan,
based on the "Hannover Declaration”, which was concluded in March this year.
• In order to strengthen the excavation and fostering of advanced IoT businesses and otherbusinesses through the "IoT Promotion Consortium", the government will advanceinternational collaborations such as cooperation with overseas IoT promotion organizations andsupport for matching with overseas companies, and also advance support in the creation of
concrete projects in regions that were chosen as "Local IoT Promotion Laboratory". For thecreation of further advanced projects, the government will study ideas of selecting projects
with a focus on the problem-solving by having competitions, and holding data analysis
competitions utilizing real industrial data owned by important infrastructure companies andother entities during this fiscal year, then implements concrete measures.
ii) Institutions and rules that help advance data coordination and utilization• In order to encourage data coordination and utilization beyond the boundaries of companies, thegovernment will promote the utilization of agreement guidelines and the like concerning theauthority of use of data that was formulated in May this year, and also advance the clarificationand sharing of the data use authority through proper conclusion of agreements between

64companies. In addition, the government will organize items to be noted by each field throughdialogues with the industry world, etc., by the end of this fiscal year, so as to advance thedevelopment thereof into individual industrial fields, revise the guidelines and take additiona lmeasures as necessary, also advance international discussions on how to set the authority fordata utilization, etc.
• In order to develop an environment where data can be exchanged with confidence andappropriate considerations for data creation, collection, analysis, management, etc. can beobtained corresponding to the cost invested in the development, etc., the government will study
measures also taking into consideration of a revision to the Unfair Competition Prevention Act
to include prohibition of fraudulent acquisition of data, etc.
• In order to promote the coordination and utilization of data using IoT related equipment among
multiple businesses on the supply chain, the government will consider reviewing necessary
institutions during this fiscal year, with an aim at positioning the "Collaborative Energy
Conservation" that enables proper evaluation of energy saving achieved in collaboration among
multiple business operators, not by each operator, as a new energy conservation method.
• In order to grant regulatory incentives to business operators that are engaged in advanced
industrial safety such as constant monitoring of facilities by utilizing IoT and data, thegovernment will disseminate the "Super Accredited Enterprise System" under the High Pressure
Gas Safety Act, which has launched recently, among the industrial safety sector, and consider
expansion thereof to sectors where the safety making full use of IoT needs to be promoted,
taking consideration of conducting demonstrations, etc.
• In order to promptly introduce the latest IoT-related equipment necessary for data collection andutilization at manufacturing sites, it is necessary to promptly incorporate internationa lstandards on safety regulations into the domestic regulations when such equipment is used at
manufacturing sites. For this reason, first of all, the government will incorporate the latest
international standards in the explosion-proof regulations based on the Industrial Safety and
Health Act, during this fiscal year and study a framework that can quickly cope with a revision
to the international standards later on.

65

4. Improvement of infrastructure productivity and urban competitiveness(1)
Main progress status of KPI《 KPI》Improvement of the productivity of construction sites by 20% by FY 2025.
* KPI that we will freshly set up this time
《 KPI》Tokyo will rank the third place in the city overall strength rankings by 2020.
=> In 2016: 3rd place (In 2012: 4th place)(2)

i)

Specific measures to be newly taken
In order to strengthen the international competitiveness of Japan and promote economic
growth, the government will strengthen the function of the industrial infrastructure, through therapid development and utilization of arterial high-standard highways, high-speed transportation
networks that include new bullet trains, linear Chuo Shinkansen lines, international hub airports,
international containers and bulk strategic ports and other facilities, at the same time advancing
the initiatives of strategic infrastructure management with a slogan "Investing and using wisely"
and Compact City Plus Network, and also advance the initiatives that can bring out the stock
effect of infrastructure maximally, such as productivity improvement and evocation of private
investment. Together, the following measures will be taken:

Improve productivity of development and maintenance of infrastructure• In respect of i-Construction which promotes the utilization of ICT in the entire construction
process from research, survey, design, construction, inspection, maintenance to updating, thegovernment will expand the scope of i-Construction to all processes including maintenance andall the project categories except earthwork and pavement work such as bridges, tunnels anddam constructions by 2019, based on the roadmap compiled at the end of the last fiscal year at
the i-Construction Promotion Consortium Planning Committee, which consists of industry,
government and academia. The government will also provide support for the ICT introduction
by implementing courses and training, with an aim at expanding the scope of application to
SMEs and local governments. Furthermore, taking into consideration of the formulation of adata utilization policy and standardization of data format to be completed by this summer, thegovernment will develop concrete utilization rules so that open data can be realized by 2019.
Through these measures, the government aims to improve the productivity in the construction
sites by 20% by FY 2025.
• The government will formulate evaluation standards, test methods and the like for infrastructure
inspection and disaster response robots during the current fiscal year aiming to achieve further
sophistication and efficiency of infrastructure inspection and disaster response. The government
will also formulate the "Robot version inspection procedures", in which the robot utilization
procedures are prescribed; those for underwater robots by the end of the current fiscal year, andthose for other areas such as bridge and tunnel constructions, sequentially. In order to advancethe development by presenting development targets, the government will set and announce therequired performance depending on the scene, in which a robot is used, beginning this fiscal
year. In addition, the government will work in collaboration with infrastructure managers to66

advance assistance in the development of advanced technologies such as robots, AI and the like.
[Mentioned repeatedly]ii) Strengthening of industrial infrastructure functions by improving productivity
The government will advance the following initiatives to realize productivity revolution, forexample, improving labor productivity of logistics companies by about 20% by 2020;• The government will improve the global share of ship construction of Japan by approximately
10% by 2025 (20%→30%), by promoting "i-Shipping", which incorporates ICT into all phasesfrom the development, construction to operation of a ship so as to improve the competitivenessof shipbuilding and shipping. Especially, by the end of FY 2023, we aim to reach an agreementon the international standards concerning vessel facilities and operation, and establish
standards in Japan, especially toward practical application of "automated ship operation" by2025. For these reasons, as elemental technologies that form the basis of the above-mentioned
standards, the government will formulate international standards relating to data transmissionof inboard equipment and the like at the initiative of Japan next fiscal year, and also aim at
introducing approximately 250 advanced vessels that utilize state-of-the-art data transmission
technology to improve the operation efficiency by 2025 based on the revised Marine
Transportation Act.
・ In order to improve the transportation efficiency and productivity of domestic coastal shipping ,which accounts for 80% of the domestic industrial basic materials transportation, a registration
system of vessel management companies will be established by the Minister of Land ,Infrastructure, Transport and Tourism during the current fiscal year to allow such vessel
management companies with technology and reliability to collectively carry out management
operations that include the operation and maintenance of individual vessels, employment ofseafarers on behalf of the micro, small and medium-sized enterprises that make up the majorityof business operators in the area, with an aim that the management by such vessel companies
will spread to 10% of the coastal shipping by 2025.
・ The government will conduct institutional reform for the remote operation of cargo handlingequipment this fiscal year, at the same time advancing the efficiency of port logistics as awhole by also utilizing AI and IoT and the like.
・ The government will aim to achieve international standardization of the world's most advanced
LNG fuel supply technology of Japan by next fiscal year, while coping with the tightening of
exhaust emission regulations on vessels that will take effect in 2020, in order to improve theoperational efficiency by supplying fuel while handling cargoes.
In order to advance the international standardization of cold chain logistics services such as
refrigerated delivery services where Japan has a competitive advantage, the government will,
firstly, formulate guidelines in collaboration with the 10 ASEAN countries by the next fiscal year.
• In respect of small unmanned aerial vehicles, the government will implement baggage delivery
next year in areas such as mountainous areas where such needs are expected to be generated.
The government will also advance the development of technology and institutions that enableadvanced flights such as BVLOS (Beyond Visual Line of Sight) Flight that doesn't requireassistants and flights over third parties aiming at implementing baggage delivery on a full scalein highly populated cities in the 2020s. [Repeat]67

• In order to maximize the stock effect of the road network, realize quick and smooth logistics,
and alleviate traffic jams, the government will advance the development of the 3 metropolitan
area ring roads including, primarily, the metropolitan area 3 ring roads, at the same time
introducing a new fee structure emphasizing the use and implementing countermeasuresagainst pinpoint congestion utilizing big data such as ETC 2.0.
• In order to advance the utilization of the system where the ramps are improved that directly
connect expressways and private facilities such as large-scale logistic bases, industrial parks
and commercial facilities located in the vicinity of the expressways by way of suggestions andcost-bearing of private businesses, the government will promptly establish specific rules.
• The government will promptly compile new comprehensive logistic policy guidelines that willserve as a guideline for future logistics measures and logistics administration, and also advancethe comprehensive and integrated efforts through the collaboration across the related ministries
and agencies.
iii) Improvement of urban competitiveness by evocation of private investment, etc.
• In respect of urban redevelopment emergency development areas, in order to designate only
areas where effective private investment is expected to be realized through a prompt
announcement of candidate areas, strengthening of private investment proposals by utilizing
information infrastructure, revision of the designation criteria that clarify social issues to besolved, etc., the government will revise the "Urban Renewal Basic Policy" (July 19, 2002,
Decision of the Cabinet) targeting by next summer.
• The government will review the institutions during this fiscal year to focus on the advancementof urban development, aiming at a flexible urban realignment according to the regiona lcircumstances such as effective utilization of vacant lots including those of public real estate
and appropriate placement of parking lots for each area.
• In order to enable sustainable development and updating of facilities in urban parks and increase
the attractiveness and utilization thereof, the government will aim at the realization of
approximately 100 revenue-generating facilities in the next 5 years, such as restaurants that are
to be installed and managed by private actors on a long term basis, and the revenue generated
can be used for the maintenance of the open space or other facilities of such urban park.
• Aiming at doubling the total assets of REIT or the like to about 30 trillion yen by about 2020,
from the viewpoint of promoting investment for conversion to and supply of real estate of highgrowth potential, the government will develop and disclose information on real estate that issuperior in perspicuity and practicality, that are necessary for improving the convenience andreliability of investors so that they could make appropriate assessment of real estate of excellent
quality in term of environmental and comfort, establish a new certification system, and review
the real estate appraisal system by the end of this fiscal year
• Our goal is to resolve social challenges of local communities by promoting the use of data
possessed by local governments. We will achieve this by making things open in the fields
focused in the government-private strategic meetings on promotion of data use andgovernment-private round tables as well as taking advantages of a business proposal system
based on the Act on Promotion of Future Investment on Communities [Repeat].
• In respect of land that is difficult to identify its owner, in order to allow proper utilization andmanagement in accordance with the regional situation, the government will clarify the consent

68requirements regarding the management of common lands, develop a new mechanism thatallows a wide range of publicly-oriented utilization that meets the regional needs with the
involvement of public institutions, and study measures to eliminate the land, the inheritanceregistration for which has not been done for a long time in a collected effort from the relevant
ministries and agencies to submit necessary bills to the next ordinary Diet session. With an eye
to the future where the number of land which is difficult to identify its owner will increase
along with a decrease in population, the government will promptly study measures for the
medium-to-long term issues concerning the registration system and the land ownership right at
the relevant councils, etc.
• In order to promote the distribution and utilization of empty houses and vacant lots by
public-private cooperation, the government will boost the efforts of local government and realestate related organizations, etc., and provide support for the utilization, management andretirement of empty houses, etc. and also develop a nationwide vacant house/ empty land bank.
The government will also enhance the real estate infrastructure by enhancing the index, etc.,
developing cadastres and registry maps. Further, the government will expand the scope of useof the statutory inheritance information certification system at the same time advancing further
efforts in term of both institution and structure to promote the collection, maintenance andutilization of owner information.

69

5. Advancement of FinTech, etc.
(1) Main progress status of KPI《KPI》Introduction of open API in at least about 80 banks within the next 3 years (by June
2020)
* KPI that we will newly set up this time
《KPI》Double the cashless payment settlement ratio, to about 40% within the next 10 years(by June 2027)* KPI that we will newly set up this time
《KPI》Four-fold increase the ratio of SMEs and other entities that increase the efficiency ofback office operations (finance/accounting and other areas) by utilizing cloudservices and introducing IT from the current state to 40% within the next 5 years(by June 2022)* KPI that we will newly set up this time
《KPI》Improving the fund circulation efficiency (Supply Chain Cash Conversion Cycle:
SCCC) for each supply chain of Japan by 5% by FY 2020
* KPI that we will newly set up this time(2) Specific measures to be newly taken
In respect of FinTech, based on the challenges and the fundamental direction indicated in reports
from the Financial System Council and the Payments Council on Financial Innovation, such as
the action plan agreed by the Working Group on Payments and Transaction Banking of the
Financial System Council, the government will achieve the sophistication of financial services
while keeping in mind the protection of users, etc., and accelerate initiatives so that FinTech willlead to the growth of Japan's economy and finance in terms of improvement of user convenienceand productivity of companies.
i)

Development of the environment for innovation, etc.
① Acceleration of the challenges to achieve innovation using FinTech
In order to accelerate the challenges of stakeholders to achieve innovation utilizing FinTech, thegovernment will work on the following measures so that FinTech from Japan will lead the world.
A) Development of an environment that facilitates the challenges (FinTech Demonstration Test
Hub (tentative name))
The Financial Services Agency will take measures to facilitate demonstration tests on FinTech.
In doing so, financial regulators will study measures to be taken through more active and attentive
manners taking into consideration of the importance of eliminating hesitation and concerns of
FinTech companies and financial institutions (risks related to compliance and supervision) that70

they tend to have when they carry out unprecedented demonstration tests. Meanwhile, relevant
ministries and agencies will work together on such initiatives and take measures such as installinga liaison counter to help solve not only failures related to financial laws and regulations, but also
other failures.
B) Acceleration of the initiatives toward practical application of blockchain technology infinancial services
Blockchain technology, in particular, is highly likely to become a game changer that changes
the mechanism of the financial system itself. Therefore, from the viewpoint of securing thecompetitiveness of Japan's financial businesses, the government will proactively advance theinitiatives aimed at practical application of blockchain technology in the financial field.
Specifically, the government will implement the following initiatives aimed at achieving
international initiatives related to practical application of blockchain technology, improving userconvenience, and strengthening growth potential.
• The government will begin the operation of the platform for demonstration tests on blockchain
technology, which will serve as a center of practical application of blockchain technology.
Using this platform, the government will initiate demonstration tests to advance thesophistication of financial infrastructure, in areas such as transactions of electronic recordmonetary claims, identity verification and management of payment and logistics information
through a collaborative effort from FinTech companies, financial institutions, the Financial
Services Agency, the Bank of Japan and other related parties.
• In respect of blockchain technology, the government will advance joint research in cooperation
with international research institutions and other related parties so that Japan can leadinternational research.The government will also consider participating in an international
consortium on blockchain technology as a financial authority.
② Promotion of Open Innovations
Keeping in mind that worldwide innovation competition is occurring with respect to FinTech,
the government will work, as a fundamental direction, on the strategic utilization of a large
financial stock, which includes the sophisticated banking system network, big data of settlement,
etc.
For this purpose, the government will make efforts to develop the world's most advanced
environment and infrastructure that will allow FinTech companies to connect their advanced ideas
and technologies to real financial services through taking advantage of the bank network, inparticular, forming an ecosystem for open innovation (collaboration between FinTech companies
and financial institutions, etc.) centered on open API.
From such point of view, the government will take the following measures, in specific;• The government will enforce the Act for Partial Amendment to the Banking Act. At the sametime, the government will follow up the progress of the open API initiatives taken by banks,
including the number of banks providing API, the number of contracts that banks entered intowith electronic settlement agencies, the number of business operators registered as electric
settlement agencies, and so on. Also, the government will review the issues identified in the
Financial System Council report on the bank agency business, etc. and advance thedevelopment of an environment for open innovation. In addition, at the Open API Review

71Committee established by stakeholders that include FinTech companies, the government will
study further issues related to the advancement of open API.
• The government will study issues further on how a legal system concerning financial institutions
and other should be, including development of a cross-sectional legal system that covers
payment and settlement operations and other businesses. In this study, the government will takefull consideration of the necessities to advance the innovation of financial services by FinTech
companies and other entities, to enable the financial industry to utilize new technologies, and toallow financial institutions to agilely develop and implement services and capabilities by using
IT, etc. and to expand business opportunities that include areas peripheral to their businesses.
• The government will study an efficient personal identification method suitable for FinTech.
• The government will study the advancement of the initiative that allows the government andprivate enterprises to effectively and efficiently respond to regulations and supervision throughinformation sharing between the government and private enterprises by utilizing open API,
blockchain technology and other technologies (RegTech).
ii) Cooperation with international human resources and overseas authorities
Amidst the worldwide progress of FinTech, in order for Japan to take the initiative, thegovernment will implement initiatives in which state-of-the-art human resources and knowledge
are mobilized from both inside and outside of Japan by promoting international collaboration andcooperation, network formation, etc. Specifically, the government will work on the following
measures;• The government will provide assistance to international efforts related to FinTech and overseas
expansion of FinTech companies by utilizing the international cooperation frameworks on
FinTech with financial authorities in the UK and Singapore. Furthermore, the government willconsider the expansion of the cooperative framework with overseas financial authorities.
• From the perspective of encouraging talented people from overseas, including Asia, to startfinancial and other businesses in Japan (Inbound Venture), the government will provide
support to overseas financial business operators so that they can open offices in Japan byinstalling a support desk for financial business establishment by working with the Tokyo
Metropolitan Government.
• Regarding the initiative (RegTech) that allows the government and private enterprises toeffectively and efficiently address regulations and supervision through sharing of information
between the government and private enterprises by utilizing open API, blockchain technology
and other technologies, the government will work internationally in cooperation with overseas
stakeholders.
• In cooperation with the FinTech industry and private organizations, the government will hold aninternational conference (FinTech Summit) where various stakeholders concerning FinTech
meet together.

iii) FinTech action plan for strengthening companies’ growth potential
With the establishment of the new XML system, from the perspective of sophisticating overall
financial and settlement processes of enterprises, the government will advance the "FinTech
Action Plan for the enhancement of corporate growth potential", which aims to sophisticate

72financial and settlement processes of enterprises as a whole, with the utilization of financial EDI
as the start point. In doing to, the government will study the potential transition to electronic bills /checks across Japan.
① Introduction of IT and cloud computing in accounting processes of SMEs and others• In respect of introduction of IT and cloud computing that contributes to the improvement ofefficiency of back office operations of SMEs and other entities, the Ministry of Economy, Tradeand Industry will consider more proper target levels in collaboration with the industry, taking
into consideration measures that have currently been implemented.
• In addition to promoting the initiatives to advance the introduction of cloud and other services
that will lead to the sophistication of back office operations of SMEs and the utilization of new
corporate lending services utilizing data, the government will create advanced cases of FinTech
introduction, using the "Local Benchmark", which is a corporate health diagnosis tool.
• The government will promote the compliance of the Electronic Book Maintenance Act byelectronic settlement agencies.
② Computerization of commercial flow information
By the fiscal year of 2020, the government will advance the dissemination of standardized
items of commercial flow information to be stored as financial EDI information, and further
advance coordination among companies across industries through EDI.
③ 24-hour, 365-day interbank payment system
The government will realize a 24-hour, 365-day interbank payment system next year. In
addition, the government will start follow-up work on the use of internet banking by companies
for the purpose of promoting the use of internet banking by companies.
④ Promotion of integration of information on monetary and commercial flows throughthe promotion of financial EDI• In respect of introduction of XML telegram message in financial institutions, the government
will continue to make efforts to launch the new XML system next year and to fully adopt XML
telegram message by 2020.
• In the autumn of this year and later, the government will conduct demonstration tests on the
management of settlement and logistics information utilizing blockchain technology in thefinancial industry in collaboration with the Financial Services Agency and other institutions.
⑤ Loan service and streamlined tax procedures utilizing data of the XML new system,
etc.
The government will study loan services (analysis of commercial flow information, etc.) andtax services (support of tax procedures by XML new system (issuance of electronic receipt, etc.))that utilize data of XML new system and other systems.
⑥ Shifting to electronic notes / checks across the entire nation
From the viewpoint of reducing the administrative burden of both companies and financial

73

institutions concerning bills and checks and of enabling coordination with financial services thatutilize IT, the government and the industry will work together to consider full adoption ofelectronic notes/checks.
iv) Advancement a cashless society and sharing and utilization of consumption data
• In order to reduce cost of card settlement and improve the convenience of consumers through theutilization of FinTech, and thereby to boost the development of a cashless society, thegovernment will allow business operators to use electro-magnetic methods, including e-mail,when they provide settlement information to customers. This measure will be taken as an effort
based on the Act for Partial Amendment to the Installment Sales Act to ease card affiliatedstores’ obligation to deliver information about card transactions to customers in the form of
documents.
• In order to further advance the sharing and utilization of consumption data through theutilization of FinTech, the government will develop an environment for the advancement of API
coordination concerning credit card data usage and for the standardization of digital recept
format aimed at advancing digitization of receipt by the end of this fiscal year.
• In respect of the advancement of installation of ATMs that accept foreign-issued credit cards atfinancial institutions, in order to establish an environment that allows all travelers to enjoysightseeing comfortably without being feeling stress, the government will work on the
improvement of most of the half of ATMs installed by the mega-banks (about 3,000 units intotal) so that these ATMs accept credit cards issued overseas. This effort is based on the"Tourism Vision to Support the Future of Japan" (decided at the meeting of the Council for theDevelopment of a Tourism Vision to Support the Future of Japan on March 30, 2016).

74

6. Overcoming energy and environmental constraints and expanding investment(1)
Main progress status of KPI《KPI》Implement legal unbundling of the power transmission and distribution divisions
on April 1, 2020, as the final stage of the power system reform.
=> OCCTO (Organization for Cross Regional Coordination of Transmission Operators)
was established on April 1, 2015. On June 17 of the same year, the Act for Partial
Amendment to Electricity Business Act and Other Related Acts in which the legal
unbundling of the transmission and distribution divisions and related masures wereprescribed was enacted. On September 1, the same year, the Electricity Market
Surveillance Commission (currently the Electricity and Gas Market SurveillanceCommission) was established. Full liberalization of retail electricity sales was
implemented on April 1 last year.
《KPI》Aim to increase the proportion of next-generation automobiles to newly soldpassenger automobiles to 50% to 70% by 2030=> Proportion of next-generation automobiles to newly sold automobiles is 35.8% (asof last year)《KPI》Establish about 160 commercial hydrogen stations by 2020 and about 320 stations
by 2025=> 90 stations have opened (as of the end of March this year)(2)

Specific measures to be newly taken
Considering the realization of energy mix and the Paris agreement, the government aims to
expand the energy and environmental investment, overcome the energy restrictions, drasticallyreduce domestic greenhouse gas emissions and make the utmost contribution to the global
reduction of emission, and thereby realize economic growth. For this purpose, the government
will work on the creation of a virtuous circle of improvement of the profitability by improving
energy efficiency and energy conservation investment, dual success of an introduction ofrenewable energy to the most and the control of the burden on the people by the feed-in tariff,
etc., the revitalization of competition in the power and gas markets and addressing issues related
to public interest faced under liberalization, and building new energy systems such as hydrogenutilization. The government will also advance the strategic resource development investment,
development of a resource procurement environment, steady recycling of secondary resources,international development of energy and environmental industry, etc. Furthermore, taking the G7Ise-Shima Leaders’ Declaration into consideration, the government will conduct discussions toformulate a long-term Greenhouse Gas low emission development strategy well ahead of thedeadline of 2020 and submit it to the United Nations, and also advance the development of
infrastructure for climate risk information, promote adaptation measures concerning agriculture
and disaster prevention in each region of the country, and develop them internationally, thereby

75connecting to the reduction of investment risk and development of adaptation business.
i)

Promotion of thorough energy conservation• The government will promote energy conservation by business operators in terms of both
regulation and support. The government will also study measures by the end of this fiscal year
to promote determination of energy conservation investment by management, opening of
periodical report data, etc. required by the Energy Conservation Act, collaboration efforts bymultiple business operators (data coordination by smart factories, waste heat matching,strengthening cooperation between cargo carriers and shippers, etc.), support to SMEs in theirenergy conservation efforts by private enterprises equipped with energy saving expertise andprovision of information by energy retailers, etc.
• In order to promote energy conservation in the civilian sector, the government will mandate
compliance with the energy conservation standards for newly built houses and buildings instages by 2020 while fully considering the necessity and degree of regulation and balance andaim to make newly built houses and buildings equivalent to ZEH or ZEB on average by 2030.
For this purpose, the government will advance the generation of social awareness of heatinsulation performance and energy consumption performance.
• In order to promote energy conservation in the transport sector, the government will promoteenergy conservation by disseminating next-generation automobiles, establishing anddisseminating evaluation systems for transport operators. In respect of automotive storage
batteries, the government will accelerate the development and practical application of allsolid-state lithium ion batteries, etc., which have more excellent performance in terms of safety
than current liquid lithium ion batteries.
• The government will expand the markets of low-carbon type products, services and lifestyles
through national campaigns aiming for the promotion of energy conservation efforts by eachregion in cooperation with local governments and other organizations.

ii) Advancement of introduction of renewable energy• The government will work on the measures to resolve the grid constraints, including theimprovement of efficiency of power systems, development of interconnections between areas,
improvement of efficiency of actual operation of output control, development anddemonstration of technology relating to output prediction and discharging control ofaccumulators, development of transmission network and demonstration of technological issues
at sites suitable for wind power generation, etc.
• The government will work on the technology development of photovoltaic power generation for
reducing cost and packaging products, utilization of data and cost reduction in wind powerindustry, etc. In order to advance the introduction of offshore wind power generation, in
addition to generalizing the method of speeding up environmental assessment, the government
will streamline the process for occupation of port area required by the Port and Harbor Act andthe examination of a construction plan notification required by the Electricity Business Act andmake rules on the use of general sea areas.
• The government will prepare an environment aimed at widely introducing biomass power
generation using various biomass, including woody biomass and waste biomass such as sewage
sludge.

76• The government will advance the zoning method study model project aimed at promoting the
introduction of wind power generation compatible with environmental conservation and takemeasures to advance the introduction of wind and solar energy such as promoting theestablishment of a regional council to promote information sharing and consensus building.
iii) Establishment of new energy systems• The government aims for the realization of 3E+S while effectively utilizing the market
mechanism to stimulate the competition in the electric power market. For this purpose, thegovernment will raise the liquidity of the wholesale power market and establish new power
markets such as base load power market, capacity market, non-fossil value trading market, andreview the interconnection line usage rules, also advance the detailed institutional designing on
the assumption of an introduction thereof around 2020. The government will also study power
futures trading taking into consideration of the development of an environment where power
futures trading is made together with LNG and other energy futures trading as a one stop
service as much as possible.
• Aiming at the establishment of an innovative energy management system ("Reform 2020"
project), the government will work on the initiative to advance the expansion of energy
equipment that can be used for negative watts trading and virtual power plants, etc., theexpansion of communication standards, establishment of high precision control technology inseconds, demonstrations aiming at developing communication infrastructure, reduction of thecost of stationary storage batteries. Furthermore, in order to maximize the utilization ofrenewable energy, the government will demonstrate the demand-generating demand response
beginning this fiscal year, at the same time reviewing the institutions for leveling the electricdemand based on the Energy Conservation Act this fiscal year. The government will also
advance the construction of an energy system based on the local production for local
consumption.
• Aiming at the realization of a "hydrogen society" that fully utilizes hydrogen energy, thegovernment will advance the introduction of fuel cells for household, business and industrialuse, and accelerate the dissemination of fuel cell vehicles, fuel cell buses, hydrogen stations, etc.
by advancing following initiatives collectively; establishing a new promotion framework by
government and private sectors toward the strategic development of hydrogen stations;
implementing technological development and demonstrations to reduce cost; advancing
regulation reforms on the safety management of hydrogen stations based on the new regulatory
reform implementation plan; and so on. In addition to the above-mentioned initiatives, thegovernment will advance the establishment of an international hydrogen supply chain andimplementation of hydrogen power generation technology development and demonstrations,and formulate a national basic strategy by the end of this year incorporating the scenario for afull-scale introduction around 2030, aiming at the realization of a hydrogen society.
iv) Promotion of the Fukushima Plan for a New Energy Society• Based on the "Fukushima Plan for a New Energy Society" (September 7, 2016, Decision of theCouncil for Realising the Fukushima New Energy Society Vision), the government will
advance various measures, for example, enhancing the wind power generation transmission
lines in order to expand the introduction of renewable energy. In addition, the government will77

transmit the potential of hydrogen and the successful reconstruction of Fukushima to the world
by manufacturing hydrogen on a large scale from renewable energy in Fukushima Prefecture
under the name of the "Utilization of CO 2 -free hydrogen derived from renewable energy("Reform 2020 Project") and utilizing it in the Tokyo Olympics and Paralympic Games in 2020.
Therefore, the government will begin introducing demonstration facilities during this fiscal
year.
v) Strengthening of research and development of innovative energy and environmental
technologies• The government will form a research group consists of industry, academia and government andwork on the extraction of issues that are causing bottlenecks in the promising fields that havebeen specified in the "Energy and Environment Innovation Strategy" (April 19, 2016 Decisionof the Council for Science, Technology and Innovation) and study the solution of such issues
this fiscal year, at the same time, consider new projects to be implemented and encourage joint
efforts from government and private enterprises.
vi) Strengthening of resource security under sluggish resource prices, etc.
• The government will promote securing of resource interests by Japanese companies bystrengthening assistance in risk money supply based on the Act on the Japan Oil, Gas andMetals National Corporation, Independent Administrative Agency, which was revised in
November 2016 as well as by strengthening resource diplomacy with the United Arab Emirates(UAE), Russia, etc. The government will also steadily implement measures to ensure stablesupply including provision of support in the exploration and development of mineral resources
such as lithium and cobalt, the prices of which are rising against the backdrop of the spread ofelectric vehicles worldwide.
• To further advance the development of conventional petroleum and natural gas in Japan, thegovernment will review the exploration framework including the renewal of three-dimensional
geophysical survey vessels and promote the utilization of data such as information on mining
areas. In respect of marine resource development, in relation to methane hydrate, thegovernment will advance the public-private cooperation such as technology development forthe development and commercialization thereof based on the results of marine production tests.
In respect of submarine hydrothermal deposit and rare earth mud, etc., the government andprivate sectors will work together toward the development and commercialization thereof.
• In order to promote the recycling of useful metals and other resources taking advantage of theadvancement of Japan's environmental technologies which we boast, the government willdevelop technologies that will contribute to the improvement of productivity of nonferrous
smelters, etc., and strengthen the competitiveness of circulating industry aiming at widely
disseminating the small home appliance recycling system and increasing collection volume andestablishing a resource recycling system, through the production of award medals for the
Olympic and Paralympics utilizing urban mines.
• Based on the "LNG Market Strategy" (Formulated by the Ministry of Economy, Trade andIndustry on May 2, 2016), the government will advance measures for the realization of aflexible and highly transparent LNG market in collaboration between government and private
sector. In particular, the government will provide support in the elimination of destination78

restrictions and the expansion of the LNG market throughout Asia, including Japan so as toachieve Asian energy security.
vii) Utilization of nuclear power generation the safety of which has been verified• Under the premise that priority is given to the safety over any circumstances and the government
will do its utmost to dissipate public concern, the government maintains a position that thesafety of nuclear power plants is left to the expert judgment of the Nuclear Regulation Authority,
and when a nuclear power plant is determined to conform to the regulation of the world's most
severe level by the Nuclear Regulation Authority, the government will respect the judgment andrestart the nuclear power plant operation. At that time, the government will also stand in thefront line and work to gain understanding and cooperation of stakeholders such as the local
municipality.
• In respect of nuclear disaster countermeasures, the government will enhance the formulation ofevacuation plans, human resource development through training and education, securing
evacuation routes by road improvement, etc., improvement of radiological protection facilities
in order to ensure the safety and security of residents. At the same time, the government will
make efforts to restore society's confidence in nuclear energy, by developing a framework toconstantly pursue safety by listening to the voice of the community, through the repeateddialogs among all stakeholders involved in nuclear generation (autonomous system forcontinuous improvement of safety of nuclear power), to enhance and materialize activities forthe settlement of the accidents and victims' support, etc.
• From the viewpoint of improving the safety, reducing the volume of radioactive waste, reducing
the level of harmfulness, etc., the government will advance research and development for the
future on the premise of nuclear non-proliferation efforts, by utilizing the high-speed
experimental furnaces owned by the Japan Atomic Energy Agency and universities, etc. and thetest research reactors that include high-temperature gas reactors, while properly advancing
international cooperation, also taking into consideration of the "Fast Reactor Development
Policy" (December 21, 2016, Nuclear Energy Ministerial Decision). At the same time, thegovernment will steadily work on the human resource development, etc. in such fields.
viii) Promotion of international development of Japan's energy and environmental industry• In order to strengthen the international competitiveness of the energy industry and promote
overseas development under the environment after the full liberalization of retailing ofelectricity and gas markets, the government will lead the formulation of international standards
concerning the operation and maintenance of power plants, at the same time providing support
for the development of energy policies of emerging countries by strengthening human resources
development in ASEAN countries, strengthening the structure of the Economic ResearchInstitute for ASEAN and East Asia (ERIA) and others.
• The government will contribute to the reduction of global carbon emission under the Paris
Agreement, through international development of Japan's excellent low-carbon technologies,
and connect such efforts to the further economic growth of Japan. The government will aim atachieving the overseas business scale of cumulative amount of 1 trillion yen by 2020 throughthe promotion of the "Japan's Assistance Initiatives to Address Climate Change" (formulated by
the Ministry of the Environment on November 11, 2016), acceleration of project formation

79

utilizing public finance, "visualization" of reduction contributions and provision of the credit
system (JCM), which can lead to the spread of projects not depending on subsidy led by private
sector.
• In order to advance international development of circulation industry and the construction of an
appropriate resource recycling system, the government will actively spread awareness of thebenefits gained from an introduction of sophisticated technology and the promotion of resource
recycling to Asian countries concerned and provide assistance in the establishment of selection
processes of business models or proper technology related to waste power generation, domestic
wastewater treatment, etc., and the introduction of institutions, collectively. The government
will advance training of personnel related to waste treatment, preparation of guidelines, etc., for
African countries.

80

7. Robot Revolution / Bio Material Revolution(1)
Main progress status of KPI《KPI》Robot domestic production market size in 2020: 1.2 trillion yen in manufacturing
field, 1.2 trillion yen in non-manufacturing fields such as service field=> FY 2015: Approx. 689 billion yen in manufacturing field, approx. 123.9 billion yen in
non-manufacturing fields（FY 2014: Approx. 590.1 billion yen in manufacturing field, approx. 61 billion yen in
non-manufacturing fields）《KPI》More than 2% annual improvement in labor productivity of manufacturingindustry=>The average growth rate for the most recent 3 years (2013 - 2015): 1.4%
《KPI》Market size of robot care equipment, approx. 50 billion yen in 2020, approx. 260
billion yen in 2030 [Approx. 1 billion yen (2012)]=>In 2015: 2.47 billion yen《 KPI》 20% of domestic important infrastructure / aging infrastructure, will haveincreased the level of efficiency by around 2020 by utilizing sensors, robots,non-destructive inspection technology, etc., and all of them by 2030.
=>In respect of next-generation social infrastructure robot inspections in underwatersector, the introduction to the sites began on a trial basis in FY 2016. As for thesocial infrastructure monitoring technology using sensors, etc., on-site verification
has been in progress.
《KPI》Realization of an unmanned automated driving system by remote monitoring,
including movebetween fields, by 2020=>Research and development aimed at realizing unmanned driving of agricultural
machines by remote monitoring is underway in the "Strategic Innovation Creation
Program (SIP)". Also, aiming for the commercialization of automated driving ofagricultural machines under manned surveillance, the "guidelines for ensuring safetyconcerning automated driving of agricultural machines" (formulated by the Ministryof Agriculture, Forestry and Fisheries in March, 2017) was formulated.
(2)

Specific measures to be newly taken
The government will make the social challenge of a shortage of workers due to a decline inproduction age population a great opportunity to realize a world's best robot utilization society.
Since the decision of the "Robot New Strategy" that presents the strategy and roadmap, which81was made in February 2015, by the Headquarters for Japan's Economic Revitalization, thegovernment has accelerated the initiatives for technological development and demonstrations byeach sector (manufacturing, service, nursing care, medical care, infrastructure, disaster response,
construction, agriculture, forest, fisheries and food industries). Moving forward, their focus must
be shifted to the stage of actually incorporating in society on a full scale from the stage ofdevelopment and demonstrations.
The government will advance the introduction of robots to SMEs and micro businesses, which
will become the key to spreading the 4th Industrial Revolution to the entire nation. The
government will advance measures to drastically reduce robot introduction costs until 2020 anddouble human resources that support the introduction of robot systems.
The government will also advance the introduction of robots that meet the needs of work sitesof various fields. In order to accelerate the development and demonstrations of technology forthis purpose, the government will develop a new "Fukushima Robot Test Field" in the
Hama-dori area, Fukushima Prefecture so that it could be utilized from next fiscal year
sequentially, making it a demonstration base of next generation robots that Japan boasts to theworld. At the same time, the government will advance the realization of industrial clusters, withthe said field as the core, improvement of the surrounding environment, creation of businesses incooperation between local enterprises and non-local enterprises, and advance the "Fukushima
Innovation Coast Concept" that is also incorporated in the Act on Special Measures for the
Reconstruction and Revitalization of Fukushima with robots as one of the priority areas. In
respect of small unmanned aerial vehicles, the government will expand the scope of industrial
use by advancing technological development and institutional considerations so that small
unmanned aerial vehicles could be used for logistic purposes safely and on a full scale in highly
populated cities in the 2020s. The government will accelerate the realization of the concept ofthe "Reform 2020" project that promotes the incorporation of advanced robot technology into
society and showcasing the achievement towards 2020.
While in the field of biotechnology, integration with big data and AI technology has advanced
rapidly, which has made it possible to make a maximum use of potential biological functions
that had not been fully used. On the other hand, the domestic market of high-cost biotechnology
products is small, in reality, which prevented Japan's elemental technology from being fully
utilized. Moving forward, by implementing the development of technology infrastructure andmarket creation integrally in collaboration with government and private sector, a new industry
creation/recycling society utilizing innovative biotechnology could be realized.
Further, in the space field, amid the situation where both the quality and quantity of available
data have drastically improved, and the market size of new business and services that utilize big
data and AI technology is expected to expand drastically, which will become a key for Japan towinning an international competition moving forward. In conjunction with the space equipment
industry, which will become infrastructure, the government will boost the creation of new
industries.

82

Along with these robots and technologies in cutting-edge fields, new technologies that can beapplied to a wide range of industrial fields such as VR and AR are also progressing. 1 There are
expectations for the creation of innovation in a wide range of fields, for example, provision of
new products and services combining such features with robots that can change the society, as
giving users perceptions close to real experiences on the spot without travelling to such scenes orbeing able to overlay information on the real situation, training in fields related to human life,
entertainment, tourism and other areas.
i)

Robot Revolution① Execution and evolution of robotic new strategy• The government will provide expert support for IT and robot introduction to more than 10,000
companies by the end of this fiscal year, aiming at the creation of new services and added value
using data from SMB and SME in manufacturing industry. The government will also encourage
initiatives to develop bases that allow businesses to receive consultation from the "Smart
Manufacturing Support Team", which provides consultation on the improvement of
manufacturing sites and also provide assistance in the utilization and introduction of IoT/robots,with an aim at setting up such bases at about 40 locations nationwide within two years. In
addition, the government will promote measures to strengthen training in its effort to double thenumber of "system integrator" that proposes and supports SMEs in their robot introduction to
30,000 by 2020.
• Aiming at achieving a reduction of small general-purpose robot introduction cost by more than
20% by 2020, the government will advance the development of platform robots equipped with
common functions to become infrastructure that can be used in general-purpose work andprocesses, so that they could reach the level to be sold in the market in FY 2019.
• The government will steadily advance the demonstrations of the effectiveness of utilization ofrobots, sensors and the like at nursing care sites, then based on the demonstration results, takemeasures in the aspect of institution such as reviewing nursing care service fees,
personnel/equipment criteria, and other matters in respect of the robots and sensors that arefound to contribute to the maintenance and improvement of the quality of living of users andalso the reduction of the burden on caregivers at the time of the nursing care service fee
revision for the next term. [Repeat]• In our future development of nursing care robots, our goals are to maintain and improve thequality of life of users through self-support and at the same time to reduce burden of caretakers.
We will thus newly cultivate and assign project coordinators who can truly pick up the on-siteneeds, turn them into development seeds and lead the projects. Also, We will re-examine thedevelopment fields to be focused on for the robot nursing care equipment, decide the directionof our strategic development by this summer, and reflect it to the development support goal forthe next fiscal year and on. The government also support in the evaluation and test data
1

VR · AR: VR stands for Virtual Reality, which is technology that allows the user to experience
immersive feeling like being in virtual space. AR stands for Augmented Reality, which is thetechnology that displays information such as images superimposed on the real space and offers
the user experiences that add information onto the current environment.

83

acquisition for advancing coordination between ISO13482, which is the standard concerning
the safety of the day-to-day living support robots and the overseas systems, so as to smoothly
develop an overseas robot nursing equipment market. [Repeat]• The government will formulate evaluation standards, test methods and the like for infrastructure
inspection and disaster response robots during the current fiscal year aiming to achieve further
sophistication and efficiency of infrastructure inspection and disaster response. “Procedures for
the Inspection of Robots” for underwater robots that show procedures of robot use will beestablished by the end of this fiscal year, and we will further establish procedures for otherfields including bridges and tunnels. In order to advance the development by presenting
development targets, the government will set and announce the required performance
depending on the scene, in which a robot is used, beginning this fiscal year. In addition, thegovernment will work in collaboration with infrastructure managers to advance assistance inthe development of advanced technologies such as robots, AI and the like.
• Aiming for the commercialization of unmanned systems under manned monitoring ofagricultural machines by next year, utilizing geospatial information (G space information),
realization of an unmanned automatic driving system by remote monitoring by 2020 and so on,
the government will advance the research and development and on-site demonstrations of AI,
IoT, big data, robot technology, etc. in the agriculture, forestry and fishing fields.
• In respect of small unmanned aerial vehicles, the government will implement baggage delivery
next year in areas such as mountainous areas where such needs are expected to be generated.
The government will also advance the development of technology and institutions that enableadvanced flights such as BVLOS (Beyond Visual Line of Sight) Flight that doesn't requireassistants and flights over third parties aiming at implementing baggage delivery on a full scalein highly populated cities in the 2020s. Through the utilization of the demonstration field
located in the Fukushima Hama-Street area, the government will formulate performance
evaluation criteria of aircrafts, and advance the development of flight management systems,
collision avoidance technology and the like that enable simultaneous flights of multiple
aircrafts, and also advance the international standardization. The government will also conduct
research and study with regard to the use of radio waves for the realization of BVLOS (Beyond
Visual Line of Sight) flights, taking into consideration of the progress of the flight rules andtechnology development of small unmanned aircraft In addition, the government will clarify therequirements of the aircraft and pilots, etc., concerning BVLOS (Beyond Visual Line of Sight)
Flight that doesn't require assistants by the end of this fiscal year, revise the examination
guidelines for permits and approvals based on the Civil Aeronautics Act early next year, andconsider streamlining of the application procedure by utilizing the Council that is working on
the formation of agreements with stakeholders and the formulation of safety measures. In thisway, the government will revitalize the unmanned aircraft industry through technologicaldevelopment and response to the system, aiming to expand the industrial use.
• Aiming at the realization of next generation robots, the government will develop a simulation
environment at a global research base on the field of integration of high-precision sensors,
camera systems or other technologies with AI technology, and undertake
industry-academia-government joint projects that cover from research and development,
practical application through commercialization in an integrated manner, for example,
production line control by AI, coordination of autonomous work robots, etc. beginning this84

fiscal year
• In preparation for the "World Robot Summit" (Robot International Competition) to be held in
Aichi Prefecture and at the "Fukushima Robot Test Field" in 2020, the government will
establish standardized international evaluation methods for robots in the fields specified by the
Summit, and work on the preparations for the next year's pre-competition including publicity
activities.
② "Reform 2020" Project (Realization of a Universal Future Society by advanced robot
technology)• The government will advance demonstration tests under the council that is made up of industry,
government and academia, and showcase on a trial base the achievement of Japan at the"RoboCup 2017 Nagoya World Tournament" to be held this year in close collaboration withlocal stakeholders, that include local governments.
• Aiming at promptly realizing robots that provide services in urban areas, airports, etc., thegovernment will conduct demonstration projects to create concrete exemplary cases ofutilization, and disseminate the results widely through international exhibitions, or other venues.
The government will actually utilize the "Guidelines for securing the safety of living support
robots and robot systems (1st edition)" (formulated by the Robot Revolution Initiative Council,
on June, 28, 2017) on the field in the demonstration projects and study for revisions asnecessary.
ii) Bio-material revolution• The government will advance the technological development engaged by industry, academia andgovernment for the production of functional substances utilizing living things, and formulate astrategy by this year, aiming at the creation of a new market for Japan's biotechnology industry,also advance comprehensive measures that include institutional development aiming at therealization of a carbon recycling-oriented society with innovative bio materials and a society ofhealth promotion by diet and presymptomatic.
• The government will develop a cross-sectional database that aggregate biological resource data
owned by public institutions etc., and build a real data platform for analysis by AI, etc. next
fiscal year so that it can be used by industry, government and academia.
• In order to accelerate private investment in the biotechnology field where growth is expected, inrespect of industrial utilization of genomic editing technology, the government will facilitate theapplication procedure by allowing a collective application by each facility that uses thetechnology, in addition to an application by organism used, this year. The government will also
study measures to develop business environments, including the creation of new markets
through evaluation of environmental performance of bio products, the facilitation of supply of
research and development funds, etc. through the promotion of the creation of funds to beinvested in the bio industry after listing of shares by the end of this fiscal year.
iii) Expansion of space business• Based on the "Space Industry Vision 2030" (May 29, 2017, Summary of Space Policy
Committee), the government will advance a full-scale business use of space and strengthen the85international competition of the space equipment industry through the utilization by private
business operators in active manners.
• While positioning the universe as a big data infrastructure with analysis technology such as AI,
regarding government satellite data (excluding those pertaining to security uses), we will open
it up free of charge and develop concrete disclosure methods etc. from the user's perspective
based on international trends and others and create new businesses. Also, to create advanced
demonstration cases, we will begin demonstration towards the fusion of space data and grounddata in agriculture, forestry and fisheries, disaster prevention, infrastructure maintenance andother fields this fiscal year. We will promote the utilization of satellite data (so-called anchor
tenancy) from domestic operators by government/public institutions as well.
• In respect of the development of space equipment, the government will launch a series ofsatellites that meet market needs and provide support for domestic production based on the"Comprehensive technology strategy on parts and components for space" (March 31, 2016,
Cabinet Secretariat, Cabinet Office, Ministry of Internal Affairs and Communications, Ministryof Education, Culture, Sports, Science and Technology, Ministry of Economy, Trade andIndustry, Ministry of Defense) and also advance demonstration projects in outer space.
• The government will gain globally vigorous demand for small satellite launching businesses,
through the development of H3 rocket aiming at strengthening the internationa lcompetitiveness, enhancement of the competitiveness of private small rocket businesses,
development of guidelines for the improvement of private launch fields, etc.
• The government will strengthen the support to venture companies such as "constellationenterprises" that operate large quantities of small satellites that are responsible for cultivating
the frontiers of space utilization, and examine institutional development for the provision ofrisk money utilizing government-affiliated financial institutions such as Development Bank ofJapan (DBJ) for enhancement of the viability of resource exploration venture companies andother entities.
• Based on the "Basic Space Plan" (April 1, 2016 Decision of the Cabinet) and "Basic Plan for the
Advancement of Utilizing Geospatial Information " (March 24, 2017 Decision of the Cabinet),
the government will develop Quasi-Zenith System with 4 satellites next fiscal year and increase
the sophistication of automated driving of agricultural machines and disaster prevention
systems through the realization of high precision positioning service, etc. Furthermore, thegovernment will advance the G space project, which distributes and utilizes geospatia linformation with the G-space Information Center as the core, realize sustained positioning
through the Quasi-Zenith Satellite System with 7 satellites targeting by 2023, and maintain andstrengthen the R&D infrastructure associated with satellite positioning technology, geospatia linformation technology, and other technology. The government will also provide assistance tocountries in Asia and the Pacific in the commercialization of high-accuracy positioning
information distribution services, as well as advance international expansion to Europe andother regions by ensuring interoperability with the signals of Europe's Galileo satellites.
iv) Expansion of the aircraft industry• The government will aim for the development of the "Matsuzaka Cluster" model that realizes anintegrated production system directly linked to the improvement of production efficiency byproviding support in the training of human resources responsible for special process86(nondestructive inspection) and in the facility investment utilizing IoT. The government will
also establish the "National Aircraft Cluster Network" and provide support so that the clusters
throughout the country could be offered collectively in Japan and to overseas, and also create
opportunities for business negotiations with overseas companies in order to foster autonomousclusters capable of directly appeal themselves amid increasing overseas demand.
• Furthermore, in order to expand the scale of businesses of the Japanese aircraft industry, thegovernment will deepen cooperation with Boeing through support for the development ofadvanced technology, human resource development, efficient supply chain construction, etc.
Also, the government will create matching opportunities with companies with fewer
cooperation opportunities such as Airbus.
• In respect of finished machine businesses including MRJ (Mitsubishi Regional Jet) in the future,
the government will expand orders by top sales, develop human resources for emerging
countries including Asian countries and other regions and conduct preliminary study the order
receiving (Airport infrastructure, etc.) while properly conducting a safety assessment. The
government will also accelerate the domestic development of aircraft-related parts with thecompleted MRJ as demonstration infrastructure (test bed).

878. Revitalization of housing market centering on the existing housing distribution / renovation
market(1)
Main progress status of KPI《 KPI》Double the market size of existing housing distribution to 8 trillion yen by 2025
（4 trillion yen in 2010). * The government aims to achieve the target by 2020 asmuch as possible.
=> In 2013: 4 trillion yen《 KPI》Double the market size of renovation to 12 trillion yen by 2025
（6 trillion yen in 2010). * The government aims to achieve the target by 2020 asmuch as possible.
=> In 2013: 7 trillion yen(2)i)

Specific measures to be newly taken
Amid the trend of declining population and birthrate and aging population, in order to realize
economic growth, it is necessary to develop and cultivate new housing markets.
Therefore, the government will advance the initiatives comprehensively; revitalizing existing
housing distribution and renovation markets by developing markets in which high-quality
existing houses are appropriately evaluated as assets while updating to safe, high-quality
residential stocks by rebuilding and remodeling, and also establishing an environment in which
existing houses can be traded with confidence.
In a addition, in order to address vacant house issues which have become increasingly severe,that occurred as a result of inheritance, etc., under the idea of utilizing what can be used andeliminating what should be eliminated, the government will restrain the increase of vacanthouses and enhance proper management, at the same time advancing the activation of
distribution in the market and effective utilization of existing stocks, from the viewpoint ofmaintaining and improving the attractiveness of not only individual houses but also residential
areas such as the residential environment or local community.
In addition, by promoting the spread of next-generation housing utilizing IoT technology, etc.,
the government will create a new housing service market.

Measures to be taken for the promotion of distribution of existing houses and against
vacant house issues• Aiming at the advancement of distribution and utilization of vacant houses, etc. by
public-private partnership, the government will boost the efforts by local governments, realestate related organizations, etc., by developing mechanisms that make use of owner
information, etc. for the utilization of vacant houses and organizing smooth utilization methodsof the property management system, etc., during this fiscal year, at the same time building anationwide vacant house / vacant land bank. In addition, the government will accelerate thespread of good practices related to the utilization of vacant lots, and also examine necessary
institutions and systems.
• For the purpose of solving the owner unknown land issue, in order to make it easy to identify

88

land owners by investigating the lands in which the inheritance registry has not been conducted
for a long time, the government will study concrete measures including the revision of theinstitutions and take necessary measures according to the results thereof targeting by next fiscal
year.
• To meet new needs such as commercial use of traditional folk houses and utilization of vacanthouses as group homes and nursery schools, the government will rationalize the building
regulations for smoothly diverting existing buildings to other uses.
• In order for young and child-rearing households to move in existing private rental houses such asvacant houses smoothly and without concern, the government will create a registration systemtargeting businesses that guarantee house rent debt properly this autumn.
• In order to facilitate the rebuilding of aging apartments, the government will construct amechanism for rebuilding apartment complexes that utilizes the land sale during the current
fiscal year.
ii) Measures to be taken to promote the spread of next-generation housing• Aiming for the creation of new services through the coordination and utilization of household
equipment and related data, the government will conduct monitoring demonstrations to ensure
product safety and security, then, formulate common rules on data distribution, etc. based on
the result thereof. In addition, the government will make proposals aiming for international
standardization of communication functions, etc. targeting next year.

89

II Assignment to build horizontal structures in Society 5.0
A. Creation of value source
1. Establishment of Data-Using Base
(1)
Main progress status of KPI《KPI》Regarding the data released according to the needs of the private sector based on
the public-private round table discussion, the offer rate in a file format suitable
for machine interpretation is 100% during the intensive work period until 2020
* KPI that we will freshly set up this time
《 KPI》By 2020, the open data action rate of municipality shall be 100%
* KPI that we will freshly set up this time(2)

Specific measures to be newly taken
In the future, to realize economic growth in a full-scale population declining society thatJapan is facing to, dramatic improvement in productivity requires incorporating the results oftechnological innovation such as the 4th Industrial Revolution into society; however, an
important key is the thorough utilization of data. To do so, we need to accelerate future
investment to create a "new data infrastructure", which is a "new social infrastructure".
Promoting private business investments through the opening of public data centering on areas
with high social needs, establishing real data platform such as data distribution based on
individual fields, rules to promote data distribution between companies, an establishment of apersonal data distribution base, etc., are urgently needed. Also, to maximize data utilization, it isalso an urgent matter to consider establishing a fair competition order and develop an intellectual
property system corresponding to Society 5.0.
In the future, the "Public-Privatization Data Utilization Strategy Conference," which is thecontroller of established public and private experts based on the Basic Law on Promotion of
Utilization of Public-Private Data, will demonstrate strong leadership. Under the conference, theexecutive committee which is led by top citizens and comprised of industries, ventures, private
experts, relevant ministries, and agencies will be arranged. Based on discussion at theconference, the Cabinet adopted the "Global Leading IT National Creation Declaration, Basic
Plan for Promotion of Public-Private Data Utilization Promotion" in May of this year. From now
on we will focus on 8 prioritized areas (electronic administration/health, medical care, nursing
care/tourism/finance/agriculture, forestry fisheries/manufacturing/infrastructure and disasterprevention/transportation), and will effectively proceed to promote comprehensive utilization of
public and private data such as online codifying, promotion of open data, promotion of IT in
administration, promotion of BPR, data distribution base and service platform improvements,
measures against digital divide, consistency of government and local measures.

i) Promotion of the opening system of public data
• While we set up the "Public and Private Data Utilization Promotion Strategy Conference"
consisting of public and private experts as a controller, we intensively implement open data at
all agencies as an "intensive work period" until 2020.

90• In order to provide public data in a highly convenient form while in consideration of safety,
security and personal information, We are considering safety, security and personal information,
based on the "Open Data Basic Guidelines" (Decision by IT Strategy Headquarters, Public andPrivate Data Utilization Promotion Strategy Conference on May 30, 2017).
• We hold a public-private roundtable meeting from time to time as needed this year. Based on thereality checklist, we will promote the opening of data in a form leading to new service creation
and resolution of social issues centering on priority areas for public and private data utilization,
set at the Public-Privatization Data Utilization Strategy Conference. Through continuous
dialogue between the public and private sectors, we will utilize civilian demands forconsideration to add necessary priority areas and to examine disclosure methods.
• Regarding the map data of the registry office, as a part of measures to promote the utilization of
public and private data by the IT Comprehensive Strategy Headquarters, we will consider to beable to start providing data by 2021, and decide specific conditions and contents during thisfiscal year.
• We will promote the utilization of weather information in many industrial fields such as electric
power, tourism, distribution, insurance, agriculture through meteorological businesses
promoting consortium by industry, academia and government. In order to create a new solid
meteorological business, we will promote the release of basic weather observation and forecast
data, and review necessary systems such as ministerial ordinance during the current fiscal year.
• While positioning the universe as a big data infrastructure, regarding government satellite data
(excluding those pertaining to security uses), we will open it up free of charge and develop
concrete disclosure methods etc. from the user's perspective based on international trends andothers. We will try to create new businesses while combining analytical techniques such as AI.
Also, to create advanced demonstration cases, we will begin demonstration towards the fusionof space data and ground data in agriculture, forestry and fisheries, disaster prevention,
infrastructure maintenance and other fields this fiscal year. We will promote the utilization ofsatellite data (so-called anchor tenancy) from domestic operators by government/public
institutions as well. [Repeat]• We provide ocean information that covers a wide area, real time property and convenience in awide range other than government and public institutions. We will promote the development ofa marine situation display system, which is one of the foundations of aggregation, sharing andprovision of marine information in Japan's marine situation grasp (MDA) to promote the use inmany industrial fields such as shipping, fishing, renewable energy development, etc. Also, wewill support efforts to strengthen its capacity, such as research and development that contributes
to MDA.
• In the corporate information that can collectively search, view, and acquire corporate activity
information held by the government while using the standard vocabulary base, we will expand
the information contents such as permission information, indirect subsidized information, etc.
We aim to post one million articles by 2018.
• In this year, we will examine the direction of concrete efforts to connect solutions by AI, IoT,
etc., to administrative procedures, cooperation with support measures, standardization based on
legal systems, etc.

91ii) Data distribution among business operators• Based on the contract guidelines on the use authority of data formulated in May this year, we
will organize points to be noted regarding the setting of usage rights according to the degree ofcontribution to data creation, and encourage clarification and sharing of data usage authority
through the conclusion of appropriate contracts among companies. At the same time, we willorganize points to be noted for each field through dialogue with the industry during this year
and promote development into individual fields. Also, we will proceed with international
discussions on how to set the authority of data utilization.
• To enhance convenience of data users and promote expansion and revitalization of data
distribution market, we will realize mutual cooperation among data distribution platforms. To
do so, we will formulate self-imposed rules among private business operators based on thecontents of “Basic matters to realize cooperation between data distribution
platforms"(summarized by IoT Promotion Consortium, General Affairs, Ministry of Economy,
Trade and Industry on April 28, 2017) that items that need to be standardized were organized(data catalog, API for catalog). Also, we will support the establishment of a democratic
guidance framework to promote its dissemination during the current fiscal year.
• To support investment in innovation, we will promote the necessary legal system, corresponding
guidelines and contractual environment in relation to the development of copyright law
deregulation, prohibition of illegal acquisition, use and provision of data. (Detailed in "II-A-2.
Promotion of Intellectual Property and Standardization Strategy, Securing a Fair Competitive
Environment.")iii) Use of personal data
• Regarding PDS (Personal Data Store), information banks, data trading markets etc., they aremechanisms to promote the distribution and utilization of personal data under individual
involvement. While paying attention to "visualization" of its particular merits, we willencourage pioneering efforts through the promotion of public-private partnership demonstration
projects in sectors such as sightseeing, medical care, nursing care, healthcare, etc., in addition
to the creation of concrete projects. At the same time, to further promote data distribution andutilization based on such demonstration projects and the status of review in other countries, wewill examine the ways of institutional systems to ensure reliability, fairness and transparency
under individual involvement, and obtain conclusions this year.
iv) Data utilization in the region• We will try to create new business utilizing IoT, AI, big data, etc., in the region through support
measures such as proposal procedure for improvement of the business environment based on
the Regional Future Investment Promotion Act.
• To promote local problem solving, we will provide package support for measures utilizing
know-how and private funds such as planning support for the regional implementation of IoT
contributing to data utilization, labor support such as expert personnel dispatching, clarifying
necessary rules, and lateral development of successful cases for the municipality. Also, we
actively build a smart city that provides services by utilizing data in multiple areas such as
tourism, disaster prevention, etc., on a common open platform. We will create success stories inmore than 800 regions and organizations by the year 2020.

92• We will prepare for an examination environment where staff of local public entities can acquire
skills necessary for open data, and establish coordination / intermediary function between local
public entities holding data and private enterprises utilizing it during the current fiscal year. We
also provide technical advice to support the smooth introduction of the mechanisms forproviding anonymous machining information to municipality so that personal data possessed by
the municipality can be utilized appropriately and effectively, realizing the creation of new
industries, a vibrant economic society, and abundant residents' living. Also, we will examine
mechanisms that the municipality can collaborate with to outsource the creation of unidentified
processing information and obtain conclusions during this fiscal year.
v) Transboundary relocation of data
• To improve the environment for the smooth transboundary relocation of personal data between
Japan and the EU, we continue to strategically work on building a framework for smoothlytransferring individual data between Japan and the EU.
• Based on the Japan-EU Joint Press Statement at CeBIT 2017, we will hold a high-level andexpert meeting on data economies involving the relevant ministries and agencies of the EU and
Government Organizations and conduct dialogue.
• We will promote the APEC Cross Border Privacy Rules (CBPR) system, which is corporate
certification to continue
to support transboundary relocation of personal data.
• Based on the enforcement of laws that revise a part of the Personal Information Protection Act in
May this year, we will respond to consultation from private enterprises and others concerning
the handling of personal information and anonymous processing of information during the firsthalf of this fiscal year. Also, to promote the utilization of data concerning the protection of
personal information, we will start delivering information such as the announcement of the casecollection based on the results of consultation during this fiscal year and continuously develop
an appropriate utilization environment related to personal data. In addition, we will establish asystem necessary for promoting data utilization and develop an international data distribution
environment for the Personal Information Protection Committee.
vi) Securing information accessibility• Regarding the improvement of information accessibility, which is positioned in the current"Basic Plan of Disabled Persons (Third)" (Cabinet decision on September 27, 2013), we areconsidering the discussion of the Policy Committee for Persons with Disabilities. We will
review it for expansion and incorporate necessary measures in Basic Plan of Disabled Persons(4th) that is planned to be formulated this fiscal year.
vii) Utilization of information communication infrastructure such as the 5th generation
mobile communication system (5G)
• To improve the information communication infrastructure that contributes to social
implementation such as automatic driving, we will promote efforts for launching, by 2020, theservices of fifth-generation mobile communications system (5G) that enable ultrafast speed,
multi-connections, and ultralow-delay. In this summer, we will compile the basic strategy forsecuring frequency and quickly study technical conditions and frequency securing. In addition,from this fiscal year, we will conduct comprehensive verification tests that include detailed

93

utilization in areas such as transportation, including local cities, and actively promoteparticipation in international standardization activities and radio-use environment
improvements. Also, we will promote fair competition including non-infrastructure companies
such as MVNO in the fixed communication market where a smooth transition to mobile market
including 5G and IP network is required.
viii) Adjustment/sharing of radio frequency• From the viewpoint of effective use of frequencies, with regard to the government sector entity
to which frequency is allocated and its use, we will take measures, which we can actively
disclose while bearing into consideration that there is no possibility of interference with eachbusiness due to interception and interference of communication, and referring to overseas caseexamples. In addition, for frequencies assigned to the government sector, to grasp the actual
situation of usage conditions more accurately, we will consider survey methods including audits
by a third party, and take necessary measures. We will draw conclusions for both cases during
the next fiscal year and take action.
• Next, when setting the target value for securing frequency, we will consider setting target values
for the openness of the frequency used by the government sector to the private sector andpublic/private use. In doing so, we will also consider the precedent case in the United States
and the UK.
• We will review the value of the frequency allocated to the government sector, consider related
measures and systems for management, and effective utilization of this frequency• From the viewpoint of promoting the common use of frequencies for public officials andpublic/private use, we will consider more dynamic sharing methods, such as utilizing more
efficient and effective technology to determine general conditions including common place,time and transmission power. As soon as we are ready, we will conduct a technical exam andget a conclusion in 2020.
• From the viewpoint of efficient use of frequency and promotion of reorganization, we willconsider not only private enterprises but also applications to public service radio stations
regarding termination promotion measures. Also, we will consider expanding to a more flexible
system such as considering expenses necessary for smooth business succession of existing
licensors during the transition period as the range of expenses to be carried by newly allocatedradio waves during this fiscal year, and get the results. We will also consider ways to promotefurther restructuring such as setting incentives for the government sector, and obtainconclusions.
• Based on the progress status of the above measures concerning adjustment and sharing of
frequencies, we will review the government's management system on effective utilization of
public radio waves as necessary.
• From the viewpoint of urging new entrants and improving the international competitiveness of
our country, regarding "Experimental Testing Authority System," we will thoroughly notify
society that we can conduct experiments and tests on the provision of experimental services togeneral consumers. Also, we will try to thoroughly notify society that licenses covering not
only specific areas but also all areas in Japan will be possible if there is no possibility ofinterference or other obstructions that impedes the operation of existing radio stations. Also, tomake the application/review process transparent, when the applicant agrees, we will disclose it

94

for each individual case regarding application time, examination content, existence/absence of
license issuance/decision timing, etc. After completion of the experiment, we will investigate
and make a conclusion on the possibility of obtaining a standard license in the same frequency
band through a slight intermediate examination process based on the experiment result during
the current fiscal year.

95

2. Promotion of Intellectual Property and Standardization Strategy, Securing a Fair
Competitive Environment(1) Main progress status of KPI《KPI》Shorten the time required to acquire patent rights in half over the next 10 years(by 2023) to 14 months on average.
=> The average for 2015 was 15.0 months《KPI》Have the ratio of patent applications submitted by SMEs to be approx. 15% by
FY2019.
=> The actual result in 2015 was 14%《 KPI 》 Standardize 100 excellent technologies and products from SMEs andmedium-sized companies by 2020.
=> The actual result in 2016 was 5 cases(2) Specific measures to be newly taken
With the progress of the 4th Industrial Revolution, data is distributed among various entities,
and mutual connections are rapidly expanding. On the other hand, increase of the distribution
and use of data improves the value of data and technologies to analize data but makes loss-gainsituation complicated, and there is concern that existing intellectual property systems are notable to respond adequately. The utilization of data and AI will not proceed if the data distribution
infrastructure is inadequate and concerns about countermeasures to illegal use, disputes, etc., arelarge. Therefore, to realize economic growth in the society 5.0 era by thorough utilization of data
and AI, it is necessary to construct an intellectual property system that appropriately adjusts theinterests related to the use of data. Also, with the cooperation of many stakeholders including
small and medium-sized venture companies in mind, it is important to promote the multiple
open-close strategy including the strategy on data acquisition and utilization in addition tostrengthening the rights as intellectual property rights, secrecy as trade secrets, further
strengthening the standardization strategy. Based on these circumstances, it is necessary to
promote intellectual property and standardization strategy based on the “Intellectual Property
Strategic Program 2017” (determined by Intellectual Property Strategy Headquarters on May 16,2017).
i)Intellectual property/standardization strategy corresponding to the 4th industrial
revolution• To encourage investment in the utilization of data and AI and investment in innovation, thegovernment will develop flexible provisions to limit copyrights of the Copyright Act intending
to develop new business using big data and will advance the maintenance of corresponding
guidelines and contractual environment. Also, regarding prohibition of unauthorized acquisition,
use and provision of data, establishment of an Alternative Dispute Resolution (ADR) system toadjust the interests of intellectual property, enhancement of evidence gathering procedures forintellectual property lawsuits and the role of the patent attorneys on intellectual property andstandards, the government will take necessary measures including the submission of bills at the96

next ordinary Diet session. Additionally, the government will develop contract guidelines ondata usage authority, support the construction of data distribution infrastructure, develop andstrengthen the patent examination system that appropriately responds to IoT related inventions,study treatment of AI production processes/products in the intellectual property systemetc.
• To ensure market advantage through international standards, in addition to expanding support forinternational standardization activities and rule formation of the private sector, the government
will consider the way of cooperation on strategic and organic standardization of public andprivate sectors including the controller function (Chief Standardization Officer (CSO)) for
acquiring international standards. In addition, under the public-private partnership, thegovernment will secure superiority in international standards of important areas such as
automatic driving, smart factory, IoT, etc. and will strategically address international
standardization through strengthening collaboration between international standards andvarious regulations, actively utilizing international standards for government procurement
standards, and examining revising the Industrial Standardization Law at the next
ordinarysession.
ii) Fostering human resources informed on intellectual property and standardization• The government will promote teaching material development starting from "Consorium for
Promoting Creation of Intellectual Property" and construction of learning support system
nationwide. Based on "Three Action Plans for the Development of Human Resources
Responsible for Standardization Formulated" (formulation by the Working Group for Studying
the Development of Human Resources Responsible for Standardization, the Public-Private
Strategic Council for Standardization on January 31, 2017), industry, government and academia
will strengthen the training of human resources responsible for standardization.
iii) Strengthen intellectual property and standardization strategy of regional SMEs
• The government will promote strengthening intellectual property and standardization strategies
in SMEs through various types of support based on the "Regional Intellectual Property
Activation Action Plan" (Published by the Patent Office on September 26, 2016). Support
includes promotion of the new market establishment standardization system and thestandardization utilization support partnership system, business trip interview examination
including the regional bases patent promotion program, etc.
iv) Securing a fair competitive environment• From the viewpoint of ensuring a fair and free competitive environment in the digital market andpromoting innovation, the government will grasp the actual situation of transactions in themarket. The government will also verify whether businesses with market-dominating power are
distorting fair and free competition based on changes in the economic environment and themarket and conduct strict and accurate law enforcement when an event that violating the
Antimonopoly Act is recognized. Furthermore, to further enhance the effectiveness of law
enforcement and to deter violations, the government will review the surcharge system and takenecessary measures intending to submit a bill to amend the Antimonopoly Act in the next
ordinary Diet session.

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3. Strengthen human resources development and activation skills(1)
Main progress status of KPI《KPI》By 2022, we aim for 1 million of employed who participate in universities orvocational schools programs.
=> In 2015: Approximately 490,000 people (* KPI that we will freshly set up this time)《KPI》By the year 2022, we aim for 5,000of courses targeted for pro fessional practicaleducation and training benefits.
=> In 2017: 2,417 courses (* KPI that we will freshly set up this time)《KPI》 We will aim for 100% on the proportion of teachers who can utilize IT during
lessons by 2020=> In 2015: 73.5% (* In 2014: 71.4%)《KPI》We aim for 100% on the proportion of ordinary classrooms equipped withwireless
LAN by 2020.
=> In 2015: 29.8% (* In 2014: 27.2%)《KPI》Aim to recognize 10,000 highly-skilled foreign professionals by the end of 2020and further recognize 20,000 highly-skilled foreign professionals by the end of2022.
=> A total of 6,669 foreign nationals have been recognized as highly-skilled foreign
professionals by December 2016 since the introduction of the points system in May
2012.
(2)

Specific measures to be newly taken
While the progress of the 4th Industrial Revolution, the source of competitiveness that creates
added value shifts from "products" and "money" to "human resources" and "data". It is important
to improve productivity by adopting the abilities and skills of each worker to changes in theindustrial structure through investment in human resources.
It is necessary to consider efforts towards the future such as a lifelong active society, a supersmart society (Society 5.0) where rich growth and healthy longevity are realized and each citizen
can connect with society in various forms regardless of age, gender, etc., and can raise ability
and income through the creation of services compatible to various needs of users due to the useof AI/IoT and creation of innovation as an opportunity for structural reform and to enhance thequality of human capital and raise potential growth.
The key to solving these problems is to raise the productivity of economic society throughinvestment in the workforce and we should promote policy comprehensively.
To strengthen Japan's international competitiveness and realize sustainable economic growth98

in the situation where the combination with IT progresses in all industries, it is necessary to train
workforces who can demonstrate creativity and added value while making full use of IT and canfurther extend the strength of Japan. It is necessary to draft an "emergency plan for strengthening
IT capability" and to fundamentally expand education and human resource development basedon the following ideas:(i) Reconstruction of education and workforce development system including “life-longtraining of employed,” corresponding to the 100-year life era.
(ii) Focusing on individuals who learn and work.
(iii) Prioritize "IT power" as the deciding factor of the competition in the 4th industria lrevolution era.
(iv) Integrate efforts of industry, government and academia in society all together to train
practical abilities and skills that meet the future needs of the industry.
Furthermore, to make the expansion of education and human resource development effective,
it is indispensable to realize the working style which draw out each worker’s motivation andindividuality contributing to the improvement of prodctivity and new value creation ability. In
order to demonstrate the skills of workers effectively, it is required to clarify the content of
duties and abilities, promote fair evaluation based on qualifications and establish the entire
benefit system such as wage systems based on evaluation as soon as possible.
For foreigners, we will actively propagate positivity towards the acceptance of entrepreneurs
and exceptional foreign talent. Also, we will make further improvements so that highly skilled
foreign talent that intend to get employment and entrepreneurship outside of their own country
will be attracted to Japan's living environment, wages and employment system of Japanesecompanies, entry and residency management systems, etc.
In addition, as the industrial structure rapidly changes due to the progress of the 4th Industrial
Revolution, it is necessary for companies and individuals to respond flexibly and promptly. We
will promote labor market reform to realize the "flow of people” to the industries with highproductivity and growth potential.
Below are contents to be initiated urgently in the next 2 to 3 years.
i)Work force development to improve ability and skills of individual workers and dramatic
expansion of workforce investment.
①

Establishment of a mechanism to grasp the supply and demand of IT labor andrevision of IT skill standards corresponding to the 4th industrial revolution• Clarifying the necessity and urgency of labor required under the 4th industrial revolution
including security, data scientist, AI, IoT, etc., of the advanced IT fields. In doing so, Ministryof Economy, Trade and Industry, Ministry of Health, Labor and Welfare, Ministry of Education,
Culture, Sports, Science and Technology will work together to establish a mechanism to grasp
the supply and demand of the IT workforce as soon as possible.
• To clarify the abilities and skills required for the IT workforce, we will fundamentally revise theindicator (IT skill standards) that systemized and clarified the necessary practical ability forproviding information services based on the prospect of workforce supply and demand. Also,
we will formulate new skill standards focusing on the IT workforce capable of responding to
new technologies and new development methods that are becoming mainstream as one of IT

99

skills during this fiscal year.
② Build a system in which industry, government and academia are coodinated to train
practical abilities and skills
We will actively utilize internship in educational institutions to implement education aimed at
nurturing skills to set issue and skills related to practical IT/data, etc. Also, we will promote
efforts for workforce development by utilizing practical education coordinated by industry andacademia including practical tasks the company faces at the site, a PBL method (Project Based
Learning) that uses actual data on site, a contest format by combining two of them, etc. For thisreason, while continuously grasping the needs of the industry, we will start to create university
consultation bodies by university stakeholders aiming to share information at the practical levelwith the representatives of industry early this year. Moreover, we will advance efforts such as
establishment and implementation of educational programs through industry-academia
collaboration and industry-academia cooperation through vocational schools for regional industry
core workforce development. Also, to make these efforts cross-functional, we will examine the"public and private consortium" by industrial and educational circles, and will establish it and startactions by the end of this fiscal year.
③ System reform and policy support for higher education institutions such asuniversities to become important players in "IT and data skill training"• There is reform of the engineering education system necessary for workforce development basedon information technology, which encourages industrial structure reform such as creating new
industries including AI, IoT, Big data, etc. We will examine the way of concrete system reform
for a fundamental review of vertical division structure of each department, education period
flexibility such as bachelor/master degree 6-year consistent system, mastery of a secondary
specialized field added to the main specialization, etc in this fiscal year. We will carry out fromthe next fiscal year and aim for full-scale implementation from fiscal 2019.
• We will develop a center to conduct university mathematics, data science education andinformation technology education that go beyond specialized fields without distinction of art or
technology science. Also, we will promote the development of information technology laborsuch as information security in higher education institutions such as universities and vocational
high schools.
• In order to promote these efforts, we will support the dispatch of teachers and support staff fromthe business world by cooperating with them and collaborative development of educational
programs.
• In this year, we will construct a mechanism that can appropriately reflect the needs of thebusiness world with the curriculum development of "new higher education institutions
conducting practical vocational education."• To utilize the characteristics and strengths of professional graduate schools, we will discuss therevision of the system that allows full-time faculty members of other courses to carry out anadditional post and will review necessary items in the autumn of this year. By promoting thetransition from existing management graduate schools to professional graduate schools andjoint development of educational programs through collaboration with industry, we aim to100

enhance and strengthen the training function of a global management talent who has anadvanced expertise of enterprises and managers who are responsible for local industries.
• Regardingvocational high schools, we will enhance education including enabling educational
curricula by cooperating with science and engineering universities. Also, we will promote theinternationalization of teachers and students by sending them overseas and expanding theoverseas educational system.
④ Drastic expansion of "IT/data skills" training in "Life-long relearning of theemployed”• Regarding the advanced levels of vocational training courses centering on IT / data fields
provided by private business operators for business people, we will establish the 4th Industrial
Revolution Skill Acquisition Course Certification System (tentative name) certified by the
Minister of Economy, Trade and Industry during this fiscal year. Also we will consider
developing this subject for professional, practical education and training benefits.
• To foster the IT workforce that contributes to improving the productivity of companies, we will
implement comprehensive business owner support such as coordination of employees’ training
according to the needs of every business.
• Regardless of age and occupation, it is important for various human resources to acquire basic IT/ data skills through various opportunities. We will take measures to support individuals in orderto enrich "relearning" of motivated business people.
⑤ Creation of top talented personnel and the specialized workforce who lead theindustry• By discovering the unexplored IT workforce and utilizing the communities which are cultivatedin the training business, we will create a workforce development program for commercializationand entrepreneurial support with one-on-one guidance by project managers who have a rich
network. Through such efforts, we aim to produce 100 people who will lead to a future
entrepreneurship with overflowing challenge spirits.
• We will publicly invite technical tasks to create destructive innovation and advance the"innovation with diverse talent" program to support research and development.
• Based on the "Cyber Security Human Resource Development Program" (determined by Cyber
Security Strategy Headquarters on April 18, 2017), we will promote various workforce
development measures. Such projects include the training of the core workforce in major
infrastructure and industrial infrastructure, practical exercises for government/public agencies/
major infrastructure operators, and discovery and development of young people whilestrengthening collaboration among measures.
• Regarding nurturing workforce who operates and manages networks that support IoT, we will
clarify the skills necessary for the operation and management of network utilizing software,
virtualization technology, etc., within this year. Also, we will set up and start a system thatconsistently authorizes practice and training to acquire skills.

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⑥ Implementation of IT/data education such as programming in primary andsecondary education
Without waiting for the full implementation of the new course of study in fiscal 2020, we will
innovate digital teaching materials to make learning enjoyable according to the needs of the field,
and will further develop education materials based on usage and evaluation of results in schools
with the collaboration of the "Future Learning Consortium." Also, we will start making efforts forthe cooperation of industrial fields and educational institutions to accumulate guidance examples,
and will start full-scale deployment from the next fiscal year. In addition, towards the full
implementation of the New Course of Study, we will undertake the dispatch of external
workforces such as private companies to educational institutions from the perspective of building
a support system for guidance on programming education at schools that collaborate with theprivate sector and securing training opportunities for teachers. In addition, towards the full
implementation of the New Course of Study, we will undertake the dispatch of external
workforces such as private companies to educational institutions from the perspective of building
a support system for guidance on programming education at schools that collaborate with theprivate sector and securing training opportunities for teachers. Also, we will start making efforts
for the cooperation of industrial fields and educational institutions to accumulate guidanceexamples, and will start full-scale deployment from the next fiscal year. Furthermore, we aim toincrease the wireless LAN maintenance rate and super high-speed internet connection rate inconventional classrooms to 100% by 2020. From the viewpoint of accelerating improvements of
the IT environment in schools, we will formulate policies for IT related equipment to be
introduced at educational institutions while referring to exceptional advanced introductory classes
during this year, and we will follow up the situation of each municipality. Also, we will support
educational tools and materials that are used inside and outside the curriculum by promoting
educational IT services utilizing EdTech and cloud technologies.
ii) Promotion of working methods leading to improvement of productivity and innovation
ability① Realization of a diversified and flexible way of working• To maximize motivation and ability to achieve self-realization of autonomous individuals who
do high creativity work while improving long-term labor and ensuring the health of workers,
we will promptly establish legislation on amendment to the Labor Standards Law. This includes
the creation of a highly professional system and review of the flexible work hour system for
employees engaged in planning work at the national diet.
• To improve longer working hours, we will submit a bill to the National Assembly to revise theLabor Standards Act, which specifies the limit of overtime work with a penalty that cannot be
exceeded even by the so-called 36 agreements.
• We will introduce the “same-duty same-wage” that aims to eliminate unreasonable treatment
differences between so-called regular and non-regular employees in the same
company/organization, so that employees can work with motivation having work performanceand abilities are properly evaluated. To realize it, we will submit a bill to revise the Part-time
Labor Law, Labor Contract Law and Worker Dispatch Law to the National Diet.
• While paying attention to ensuring the health of employees, we will promote the society that102

allows people to obtain side jobs and concurrent business in principle.
• We will strengthen industrial physicians and occupational health functions to secure the health of
employees. For this reason, we will revise the necessary laws and regulations.
• We will collect good examples of flexible working styles, which are becoming widespread,support development and dissemination regarding health management methods by utilizing thelatest technology. We also consider new labor management indicators intending for future
introduction.
• Regarding telecommuting jobs that enable the exercise of diverse workforces’ abilities such ascompatibility among child care, nursing care and work, creation of flow of people and work torural areas, etc., we will revise the guidelines for dissemination while paying attention so as not
to invite longer work hours. Related ministries and agencies will cooperate to develop anational campaign regarding this.
• Regarding "working styles regardless of employment status,” we will study and implement
support measures that enable employees to formulate careers and skills autonomously after
grasping the actual conditions so that working style will be satisfactory patterns. Also, we will
study on welfare matters. Through such efforts, we will establish other ways of working thatworkforces do not belong to companies/organizations as one of options.
② Increasing wages and improvement of labor productivity
We will increase the employee's total income by continuously raising the highest level ofcorporate earnings and increasing the labor distribution rate. Also, we will increase the minimum
wage with a target annual rate of about 3% while paying attention to the growth rate of nominal
GDP and aim for a nationwide weighted average to be 1,000 yen. Toward the environment that iseasy to improve, we will support for increasing productivity by the Management Reinforcement
Law of small business and improvement of business conditions of small businesses such as
subcontracting. Also, we will provide support for improving wages and productivity by promoting
capital investment that will help improve labor productivity of enterprises while cooperating withfinancial institutions. To improve management abilities and profit necessary for increasing wages,
we will establish a framework for support such as seminars and individual consultations. We will
especially prioritize life and health related businesses such as the food and beverage industry, andexpand to other industries.
③ Realization of diversity as a management strategy
To encourage the practice of diversity management leading to medium and long-term corporate
value improvement, we will introduce a new mechanism to honor companies that have produced
results in ongoing diversity management efforts based on the "Diversity 2.0 Action Guidelines"
formulated last year (Formulated by the Diversity 2.0 Review Committee on March 2017).
④ Further promotion of female success103Based on the "Child-rearing Safety P lan," while ensuring stable financial resources, we will
support efforts to eliminate children who are on a waiting list to enternursery centers. We will
work towards further promotion of female employment, based on "Priority Policy for Accelerating
Female Employee Activities 2017" (Decision by All Women's Shining Society Building
Headquarters on June. 6, 2017). In doing so, we will promote necessary measures such as
promotion of female workforce in the labor market and the capital market through thorough"visualization" of female success information. Also includes working styles to contribute to
women's success, innovation of men's way of living and consciousness, eradicating violenceagainst women, efforts to eliminate
children who are on a waiting list to enter
nurseryinstitutions. As we focus on young people and parenting households, we will consider andproceed with the reform of personal income tax in the overall taxation system and the appropriate
way to impose taxes carefully.
⑤ Support for youth and the generations that experienced the severe employment era
We will provide assistance to students for occupational awareness from the early stage of theirstudent life and improve the environment that they can easily research about industries orcompanies. Also, we will provide comprehensive support so that young people including thegenerations that experienced the severe employment era can maximize their abilities.
⑥ Promotion of employment of people with disabilities• We will carry out efforts for employment support adopting hope and ability of persons withdisabilities through increase of the statutory employment rate in April next year, training
enhancements to give knowledge on employment of persons with disabilities. The efforts
will be carried out through enhancement of learning through lifelong such as career
education, promotion of cooperation among related organizations as well. In addition, we
will promote the use of the latest technologies for prosthetic devices and employment
support for persons with disabilities through collaboration of agriculture and welfare.
• We will promote initiatives such as employment reform awareness of a director of a company
and establishment of a triangle type support system for balancing treatments and work sothat those with diseases such as cancer will be able to work according to their treatment
situation.
iii) Labor market reform to realize "flow of people" to industries with high productivity andhigh growth potential① Promotion of "visualization" in the labor market
For the expansion of career change and re-employment, we will establish a site (O - NET in
Japan) that provides all-inclusive occupational information and allows one-stop viewing ofworkplace information of companies that women and young people can work easily. This site will
also promote visualization of vocational abilities and workplace information by utilizing of jobs
and cards. In addition, we will promote efforts to "visualize" advanced skills so that skilled
technicians in the manufacturing field who produce high added value will be evaluated.

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② Promotion of employment and career change among middle-aged and elderly people
We will promote employment and career change for middle-aged and seniors with efforts suchas formulation of guidelines for promoting acceptance of workers changing jobs regardless of age,strengthen re-employment support for seniors by Hello Work special front desk, gradualestablishment of the environment which accelerateslabor shifting such as side work or concurrent
work. We will take measures to improve the environment that can make full use of experience andothers cultivated by middle-aged and seniors. Also, we will take measures in the total package
including improvement of career education for workers, thorough career interviews forexperienced, middle-aged employees on the side of companies that transfer their employees toother companies, acquiring knowledge to promote the success of external middle-aged
experienced employees on the side of companies that accept the workforce, sharing job placement
and recruitment information in the labor market, etc.
③ Construction of a dispute resolution system with high predictability
Regarding the way of a highly predictable labor dispute settlement system including a financial
relief system at the time of nullity of dismissal, we will take necessary institutional measures
based on the results of examination of the "Review Conference on Transparent and Fair Labor
Dispute Resolution System etc." established based on "Revival Strategy for Japan" revised in2015 (decided by the Cabinet on June 30, 2015) after deliberation by the Labor Policy Council.
iv) Utilization of foreign human resources
To overcome the fierce global competition in the 4th industrial revolution, the Government will
positively accept excellent foreign professionals such as researchers and engineers with advanced
knowledge and skills, who have growing demand from wide industries with the evolution anddeepening of information technology, thereby accelerates innovation and improves the
productivity of the entire Japanese economy..
To this end, in the intensifying global competition for acquisition of professionals, theGovernment will issue constructive messages to accept entrepreneurs and highly-skilled foreign
professionals, while further improving the living environment of Japan, wages and employment
personnel systems, as well as immigration and residence control systems so that these are madeattractive for highly-skilled foreign professionals who are pursuing employment outside theircountries, and create a strategic mechanism whereby those professionals can actively work over along period of time in Japan..
① Further attraction of highly-skilled foreign professionals
It is indispensable that the Government actively accepts highly-skilled foreign professionals
with diverse knowledge for promotion of the fourth industrial revolution and creation of
innovation. For this reason, the Government has been working on the creation of“Japanese-version green card system for highly-skilled foreign professionals”, which is the fastest
such system in the world and substantially reduces the period of stay required before
highly-skilled foreign professionals can apply for permanent residence from five years to theshortest one year. The Government has been also working on revising requirements with intent ofmaking Points-based System for highly-skilled foreign professionals more user-friendly, adding105

foreign human resources who have made significant investment or have made a major
contribution to Japan in growth fields such as IoT, and regenerative medicine to "Guidelines onContribution to Japan." As a result, the immigration system for highly-skilled foreign
professionals in Japan is becoming internationally "very open." For the further attraction ofentrepreneurs and highly-skilled foreign professionals, under the slogan of "Open forProfessionals", the Government will work on publicizing Japan's immigration system including"Highly-Skilled Foreign Professionals Fast Track" that applications for certificates of eligibility ofhighly-skilled foreign professionals to be judged within 10 working days in principle, andinterpretation of "contract with public and private organization in Japan" relating to the status ofresidence for foreign researchers, engineers, etc., who visit Japan on a business trip, actively,
domestically and internationally in cooperation with overseas diplomatic missions, Japan External
Trade Organization (JETRO), etc., including high-level persons, as well as situation of the living
and working environment for foreigners. In addition, the Government will begin examining theway of matching support overseas utilizing job offer information for working in Japan in order topositively secure highly-skilled IT professionals, which leads to corporateinnovation.
② Improvement of the living environment
The Government will provide a comprehensive lecture on the Japanese language and othersubjects (JSL- Japanese as a Second Language curriculum) as soon as possible to all foreign
children (elementary and junior high school students) in need. Also, the Government will
accelerate the enhancement of Japanese language education for foreigners living in Japan. In
addition, through supports such as arrangement of medical interpretation, the Government aim toestablish the "medical institution with a system for accepting foreign patients" including reception
duties at 100 locations during the current fiscal year, which was originally planned to achieve by
2020. In addition to these core medical institutions, the Government will start expanding thefoundation of the acceptance system of foreign patients while taking into consideration the actual
circumstances of the region, and aiming for further enhancement of the acceptance environment.
The Government will also provide easy-to-understand information on locations that can handle
foreign.
③ Improvement of the working environment
To promote the implementation of diversity management including utilization of foreign humanresources, the Government will implement dissemination and awareness-raising activities aiming
to rally operating companies which utilize foreigners through awards from advanced companies
based on the "Diversity 2.0 Action Guidelines". Through such efforts, the Government willencourage the development of the working environment including the establishment ofcomprehensive strategy on foreigners’ assessment, clarification of human resource management
including foreigners and job descriptions, fair evaluation mechanism, and introduction ofenvironments that non-Japanese speakers can perform their talents, to actively accept
highly-skilled foreign professionals.
④ Support for employment of International Students
Under an initiative, “Innovative Asia,” to enhance the cultivation and circulation of106

highly-skilled foreign human resources between Japan and Asian countries through ODA andother measures, the Government will provide students with opportunities for study in Science andTechnology, and Engineering at graduate schools and research institutes, etc. as well as forinternship at companies, etc. in Japan, aiming at receiving 1,000 competent students graduatedfrom Asia's top-level universities over the 5 years from FY2017 to FY2021. Also, to improve theemployment rate of international students in Japan, 12 domestic universities will be holding an"International Student Employment Promotion Program" that includes business Japanese
education, career education, medium to long term internship, etc., for international students fromthis year. Also, regarding international students in vocational schools, the Government support
their employment to domestic companies through the vocational school globalization promotion
support project. In addition, the Government will promote employment of international students
through implementation of consultation on employment management, support for summer jobs,
etc., for companies that are considering recruiting international students and students abroad atforeign employment service centers.
⑤ Promotion of acceptance of foreign employees in Japanese companies that develop
globally
In the retail industry, the Government will realize short-term transfer within the company group,
acquisition of skills, etc., under the Minister having jurisdiction over the business in question. To
do so, the Government will conduct a concrete institutional design for the system referring to thestructure of "Foreign Employee Acceptance Program for Manufacturing Industry" starting during
this fiscal year. The Government will also continue to examine the possibility and necessity of
institution construction with reference to the above mechanism for areas that contribute to thegrowth of the Japanese economy other than manufacturing and retailing industries.
⑥ Utilization of foreign human resources in the field of construction and shipbuilding
In order to respond to the temporary increase in construction demands due to the developmentof facilities related to the Tokyo Olympic Games and the Paralympic Games in 2020, Foreign
Construction Worker Acceptance Program is designed to accept readily available foreign
workforce as a fixed-term and urgent measure (ending in FY2020). Under the existing system,
there is a risk that the number of foreign workers will decrease as they enter the country to be theForeign Construction Worker after the next fiscal year, where related construction demand is
expected to be continued. The Government will review the operation to further enhance theconstruction system to ensure the purpose of the program that the Games will be successful. In
addition, since the same program has been implemented for the shipbuilding industry, which has alarge mutual mobility of workforce with the construction industry, the Government will also
review the application in shipbuilding field in the same way.
⑦ Strengthening residence control infrastructure for facilitating / expediting ofprocedures for the status of residence
The Government will proceed with required preparations to ensure facilitation / expending ofprocedures for the status of residence, including the introduction of online procedures from
FY2018 in order to further accept foreign human resources..

107Toward strengthening residence control infrastructure, based on the principle of simplifying
administrative procedures, the Government will consider measures to accurately and quickly
comprehend the working status of foreign nationals, such as an appropriate way to utilize various
identification numbers.
⑧ Consideration on approaches to accept foreign human resources
To ensure sustainability of economic and social infrastructure, the Government will advance
comprehensive and detailed study on 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 and considerations regarding essential issues including a mechanismthat would not be misconstrued as an immigration policy and the way to shape the national
consensus..

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4. A virtuous cycle system that creates innovation and ventures(1)
Main progress status of KPI《KPI》 We aim to increase investment by 3 times from enterprises to universities andnational research and development corporations by 2025.
=> In 2015: 120.9 billion yen《KPI》The R & D investment of public and private sectors should be at least 4% of GDP
by 2020.
=> In 2015: 3.56%《 KPI》We will double the GDP ratio of VC investments to venture companies by 2022.
=> For 3 years from 2013 to 2015: 0.029%(2)

i)

Specific measures to be newly taken
While changing from a capital-intensive economy to a knowledge-intensive economy, the rolethat co-creates the future image that Japan should be in industry-government-academia andmaximize the power of universities and national R&D corporations that are bases of knowledge
and workforce that are increasing as a core.
The establishment of the national innovation system was done by university reform andreform of the National Research and Development Corporation. In the future, it is necessary toconstruct an ecosystem of innovation and venture through a virtuous circle in which theaccomplishments of innovation are invested to the next stage.
Therefore, concerning the goal of research and development investment, we aim to makeR&D investment combined with public and private sectors equal to or more than 4% of GDP.
Also regarding government R&D investment, we intend to make it 1% of GDP ratio while
ensuring consistency with "economic and fiscal revival plan." When the nominal growth rate of
GDP during the period is calculated based on the economic revival case of "Estimate on Medium
to Long-Term Economic Fiscal", the total amount of government R&D investment required isabout 26 trillion yen. This is for the investment during the period of the "Fifth Science andTechnology Basic Plan" (Decided by the Cabinet on January 22. Also, by 2025, we aim to
make corporate investment amount to universities, research and development corporations etc.
triple the 2014 level. For this reason, it is essential to strengthen and utilize the excellent basic
research capabilities possessed by universities, to fundamentally enhance theindustry-academia-government collaboration structure in universities and other countries, toconcentrate resources on active domains, to voluntarily and continuously create ventures, toincorporate new technologies such as AI into society. We will promote the "Public-Private
Investment Expansion Initiative of STI" (formulated by the Economic and Social Science andTechnology Innovation Committee on December 21, 2016). We will take the following measures
to realize these:

Drastic reinforcement of university incentive design• To strengthen the innovation capability of the university, it is necessary to further promote

109

conversion to management that can acquire self-income by attracting investors while evaluating
the efforts of universities including industry-academia collaboration and making the result"visible." It is important to accelerate the acquisition of diversified resources that can beutilized for independent management, to construct a mechanism of virtuous cycle in which
universities reinvest their funds and enhance their education and research activities, and create
further innovation.For this reason, we evaluate the results of activities based on the quantitative
KPI set by each university, which we intend to carry out in earnest of next year. We will
strengthen to notify the evaluation results widely so that the investment gathers against theongoing efforts of the university concerning the rule reflecting the result in the priority
distribution of national university corporation operating cost grants. Also, we will inform thegood practices through evaluating university efforts such as personnel system reform in which
faculty and staff engaged in collaborative research are appropriately evaluated and supported
regarding benefits and the environment, and promote excellent efforts.
• Regarding the national measures taken by the industry-academia-government collaboration, we
will add investment inducement effect of the industry to examination requirement at task
selection to encourage investment in universities. In the evaluation items of the adoption
selection, we will add the correspondence status of "Guidelines for strengthening collaborative
research through collaboration between industry-academia-government" (formulated at theindustry-academia-government dialogue meeting promoting innovation on November 30, 2016)
from this fiscal year.
• We will develop data, which is comparable and evaluate the university's industry-academia
collaboration efforts annually from this fiscal year. Based on this data, the industry estimatesthe efforts of each university so that promising universities can be chosen as collaborators ofcollaborative research.
• We will commence the designated national university corporation system, which requires
full-scale implementation of collaboration system of industry, academia, and government. Also,
we will accelerate the instantiation of the ideas of each university during this fiscal year
regarding the outstanding graduate school program (tentative name) that provides
state-of-the-art education in areas where interdisciplinary fields and Japan is superior to. We
aim for full-scale implementation in the next fiscal year and will summarize concrete proposals
such as examination by cooperating with companies and others.
ii) Focused investment to the field, in which Japan is superior・Based on "Promotion of Society 5.0 and Achieving Government R&D Investment Goals"(Decision of the General Science and Technology · Innovation Council on April 21, 2017), we
will aim for 1% of GDP regarding the government R&D investment while maintaining
consistency with "Economic and Financial Reconstruction P lan." Also, we intend to makeprivate enterprise R&D investment 3% of GDP by stimulating private R&D investment that isby "Science and Technology Innovation Public Investment Expansion Initiative." By doing so,
we aim to make R & D investment in public and private sectors more than 4% of GDP.
• In " Public-Private Investment Expansion Initiative of STI" we will guide each ministry’s
measures toward areas which promote private R&D capital by "Public/Private R&D Investment
Strategic Expansion Program (tentative name)" that will be funded in the next fiscal year.

110• We will gather top domestic and international researchers under the excellent management of thehead of the organization toward the “Center of Excellence of the world.” We will mainly
distribute resources focusing on a small number of bases to create innovation in collaboration
with industries including venture, research centers of the world's top universities and R&D
corporations during the next fiscal year. In addition, after verifying the current efforts, we willconsider the establishment of bases in fields that can aim for the world's top class in the future.
Moreover, we will examine current efforts and consider organizing bases in industries that can
aim for the world's top in the future.
• We are considering strengthening an internationally-dominant, academic information
communication base that includes a supercomputer capable of accelerating AI development andbig data processing. We also make it possible to utilize companies and others working on
collaborative research beside universities.
• While strengthening the control function of AI, we aim for incorporation into society concerning
various fields such as Productivity, Health, Medical care, Nursing care and Space Movement bycollaborating with industry-academia-government based on "Research Objectives andIndustrialization Roadmap of Artificial Intelligence" (Summarized at Artificial Intelligence
Technology Strategy Conference on March 31, 2017). We will undertake research anddevelopment project by open innovation during this fiscal year. We will also accelerate thedevelopment of core technologies such as semiconductors and innovative sensors that
contribute to improve AI learning efficiency, natural language processing, deep learningtranslation, ultrahigh efficiency AI processing, and its application to embedded systems.
• From the viewpoint of encouraging AI development and incorporation into society, related
administrative organs will collaborate with each other on basic principles that developers
should pay attention to while considering the discussion of domestic and overseas private
sector.
iii) Acceptance of investment by universities and promotion of self-acquired funds• With strong authority under top management, we will organize excellent researchers beyond thedepartment, build a new system in the next fiscal year to centralize management ofindustry-academia-government collaboration with specialized human resources such ascommercialization and intellectual property. Also, to support regional universities, we will
examine to adopt the horizontal expansion of contract and marketing know-how of excellent
technology transfer agencies in 5 locations throughout the next fiscal year.
• We will carry out strategic renovation of facilities to improve the attractiveness of
university-owned assets and for more effective utilization. In addition, to disseminate new use
models of assets such as lands at universities throughout the country, we will formulate areview policy of the system that does not meet the modern era during this fiscal year. Also, toinitiate the donation of land and stocks to universities, we will examine concrete measures andsystems based on the results of grasping the actual acceptance situation during this year.
• In the case that universities support ventures at the early time of this fiscal year, we allow toacquire the stock acquisition right even as a consulting fee and facility usage fee, and sharesacquired by exercising the stock acquisition rights over a period of time after the public
disclosure.
iv) Promotion of R&D by maximizing the resources of industry, academia and government111

• We will systematically develop data to evaluate and analyze the effect of science and technology
innovation measures and establish PDCA cycle of policy based on objective grounds.
• We aim for further expansion of publicly offered research funding including competitive funds
while trying to secure fundamental expenses such as operating expense subsidies. Also,
regarding the way of thinking on indirect expenses and restriction on qualification requirements
relating to research fraud, we will realize more effective and efficient budget execution by
unified operation among related ministries. Also, we will promote cooperation between
publicly-offered supplementary projects and efforts in reform of universities and national R&D
corporations.
• To strengthen the satisfactory and stability of the Scientific Research Funding Program(KAKENHI)we will promote reforms through implementation of "Scientific Research andExamination System Reform 2018" and "Science Grant Young Assistance Plan" based on"Implementation Policy of Science and Research Expenses Reform" (revised by the Ministry of
Education, Culture, Sports, Science and Technology on January 27, 2017) from this fiscal year.
• We will secure a stable and independent research environment for young researchers bypromoting outstanding researcher systems so that aspiring talent can aim to become researchers.
We will also build measures to accelerate the development of superior workforce development
and human resources system reforms at universities and others during next fiscal year.
• We will study about new research support methods that attract private R&D investors such ascompetition for research subjects cooperated by public and private sectors, award-style system,
etc., and we will draw conclusions during this fiscal year.
• We will implement reform in support of concept proof using fundamental research and its results
and measures to induce private investment continuously in the future from the next fiscal year.
• We will set up a council to establish autonomous communities where workforce who is
responsible for matching business at industry-government can cooperate freely acrossbusinesses and organizations from this fiscal year.
• We will promote and build a shared network of research facilities and advanced synchrotron
radiation facilities that support industry-academia-government collaboration, and we willdevelop shared systems within research organizations striving for 70 organizations by the endof the next fiscal year. Also, we will also proceed with the development of data collection andanalysis methods, etc., aiming for the construction and utilization of databases and analytical
tools that contribute to the R&D of materials that are available for industry, academia andgovernment from the current fiscal year.
• We will establish a team that produces business based on distinctive technologies of regional
universities. We will promote strengthening an intellectual property strategy and optimal
technology transfer, and try to form a regional innovation ecosystem.
v) Training and attracting innovators that can outperform against the world• We will cooperate with industry, academia, and government to expand overseas including
dispatching students to Silicon Valley, Asia, etc. Through network formation with entrepreneurs,
we will start to provide consistent support for university students and unexplored IT workforces
who have original ideas during the next fiscal year. In addition, we will proceed with"innovation with diverse talent" program to uncover creative ICT technical issues.
• In the field of digital science, we will form a consortium to promote acceptance of young112researchers between Japan and the United States during this fiscal year.
• Utilization of highly-skilled foreign professionals • In order for the further attraction ofhighly-skilled foreign professionals, the Government will actively publicize information thatthe living and working environment of foreigners has been improving, and the immigration
system for highly-skilled foreign professionals is becoming very open, while cooperating withoverseas diplomatic missions, JETRO, etc.
vi) Acceleration of voluntary and continuous creation of venture• We will consider strengthening fund functions to create innovation such as M&A of ventures bylarge enterprises.
• In order to further increase innovation development results of national research and development
agencies, we will consider the way of further utilizing their investment businesses after paying
attention to ensure sound operations and finances. We will draw conclusions during this fiscal
year.
• We will build 300 databases of researchers in universities and technical seeds that will contributeto joint research and investment of companies and investors during this fiscal year, and will
release them domestically and abroad. In addition, we will inform the problem-solving
measures related to collaboration between ventures and venture capital firms, companies,
investment companies, etc. Also, we will support the growth of venture companies by
dispatching mentors for strengthening entrepreneur support functions of municipality, regional
industries, and financial institutions. Furthermore, we will carry out matching with companies
that are equipped with necessary production facilities during the next fiscal year to support thepractical application of technology of R&D venture material at early stages.
• In order to make use of patents in flexible collaborative research and lead to creation of venture,
we will build a model to be owned independently by universities during this fiscal year.
• To promote investments by institutional venture capital investors and improve the investment
environment, we will develop intellectual infrastructure such as guidelines on funds market
value evaluation and investment model contracts, and we will start the demonstration during
this fiscal year.
• We will examine how to revitalize social ventures, which are aiming to build social businesses
and promoting effective utilization.
• We will start trial efforts to promote the utilization of R&D oriented SMEs and ventures ingovernment procurement focus on national technical demands in this fiscal year. Also, in the
research and development of core technologies such as space, ocean, disaster prevention, etc.,
we will set the technical area to actively utilize external technologies such as venture during
this fiscal year.
• By collaborating with corporate information, we will start trial operation of the one-stop
application system by sharing the application form of government support measures andbringing it online during this fiscal year. We will also arrange the tasks for full-scale operation
given development to other procedures.

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B. Mechanism to boost maximization of value
1. Establishment of "sandbox" regulation system(1)
Specific measures to be newly taken
By ensuring the opportunity to demonstrate boldly the accomplishments of innovation such as
AI · Big Data · Dispersion ledger technology · Automated flight · Automated drive which has
been developing rapidly, we need to revitalize the economy to arouse innovation for new
products and services.
For this reason, we will establish a "sandbox" regulation system consisting of two approaches
as a mechanism to promote innovation through concrete social actual proof.
First of all, as an effort on a project basis, we will establish the new framework that allows to
try first as a fundamental idea that is not bound by the existing framework.
Secondly, in the National Special Strategy Zone, we will establish a framework to promptly
and smoothly carry out demonstration experiments by drastic review of prior regulation andprocedures.
i)

Establishment of the sandbox regulation by each project• In order to link the results of innovation to the creation of new added value, it is indispensable toaccumulate the social demonstration for trials. Unless the social demonstration for trials isdone, it is not possible to acquire necessary data, and the reality is in a vicious circle that wecannot sufficiently prove to the regulatory authorities the specific needs of success methods tofollow. Because such innovation progresses at an unexpected speed, there is concern thattraditional policy methods are soon left far behind internationally. Regarding the “sandbox”
regulation system that encourages the development of business models by trial and error on thepremise of participation by explaining participants and periods and explaining the details ofrisks and explaining the participation, necessary legal measures.
• Implementing such efforts, we should establish effective system of coordination with affiliatedministries and build a unified system to strongly promote growth strategy by social
implementation of innovation cross-government.
• To response flexibility for promoting actual proofs, considering those dates are valuable even if
actual proofs don’t work well, preserving dates from result of actual proof are important.
Hands-on support should be carried out carefully, and the results of demonstration will be put tothe subsequent development of rules and policy making.
• Departments in charge of each ministry and agency shall be different departments from theregulatory execution department and shall be the top department that is responsible forpromotion from the perspective of promoting innovation.
• Reviewing about it as soon as possible within the year, and based on the result, taking necessary
actions such as submitting the related proposed measures by the next ordinary diet session.

ii) Efforts to promote demonstration of near-future technology such as automatic travelingand small unmanned aircraft in national strategic special zones• To vigorously carry out demonstration experiments of near-future technologies such as
automatic traveling, small unmanned aircraft (drone) etc. further promptly and smoothly in the
National Strategy Special Zone, we will quickly realize the creation of a regulatory sandbox

114

system to fundamentally review relevant preliminary regulations and procedures.
• Keeping basic idea of i), we develop "post-revise rules" such as information disclosure, third
party / expert monitoring, evaluation, dispute settlement system in National Strategic Economic
Zone. As a result, the preliminary regulation and procedures related to existing laws andregulations can be eliminated or reduced to the minimum.
• We will consider and take necessary actions based on the results within 1 year after enacted therevision bill of the National Strategic Economic Zone Law, currently being submitted to the
National Assembly.
(Detailed in "5. Bold Regulatory Reform by the National automated drive Special Zone".)115

2. Regulatory reform, Simplified administrative procedures, Integrated promotion of IT(1)Main progress status of KPI《KPI》Japan will be marked in the third rank for bank's business environment ranking
in the developed country of the world by 2020.
=> It is marked 26th in October 2016 (2 rank down compared to the previous year)《KPI》It is aiming to reduce administrative procedure cost１ of priority fields more than
20% by March 2020.
* KPI that we will freshly set up this time
(Along to １ "Administrative Procedure Subcommittee Summary - Toward Reduction of
Administrative Procedure Costs"), we will reduce 9 importance areas depending on matters, up to
March 2022. However, regarding "national tax" and "local tax" On the premise of realization ofelectronic filing obligation realization, separate numerical targets such as electronic filing utilization
rate of large corporation such as 100% are set, and "cooperation on survey and statistics" responds
based on statistical reform basic policy etc. The same below)(2)

Specific measures to be newly taken
Until now, the government has developed e-Gov, the governments’ portal site, and has
continued to make individual regulatory reforms and administrative procedures simpler. Basedon “Japan revitalization strategy 2016”, we made “Review of regulatory and administrative
procedures Working group summary” (April 24, 2017, Foreign Investment Promotion
Conference Regulatory and Administrative Procedures Review Working Group) and took
necessary measures, such as improving procedures and payment of establishing contributions.
From the perspective of "innovation of administrative procedures in line with technologicalinnovation" and "deduplication of administrative procedures" of domestic corporation’s point ofview, we enacted for prior efforts such as smart security at Future Investment Conference
Structural Reform Promotion Meeting and started working with it. Furthermore, to drastically
improve the burden on business co-operators, we took a big step to aim for reducing theadministrative procedure cost of businesses by over 20% by March of 2020 along with
"Administrative Procedure Group Subcommittee - For Reduction of Administrative Procedure
Costs".
In the future, while fully respecting the purpose of regulation, it is necessary we will make a
big change of the angle and working to improve user friendliness using the newest IT technology,
new systems like co-operate number and my number.
Specifically, looking at the circumstances of other countries, we will not only simply replace
the current procedure to online procedures, but in all areas, communize same purpose or samecontents of documents to same style of forms, and we will review the principle of transverse
slope for not to ask again (one-only) information that once submitted with the government
information sharing. Furthermore, we plan to unify the electronic procedures (make it one stop)in the establishment of a corporation that requires similar document procedures for multiple
institutions, payment of social insurance fees etc. In taxation procedures, information
coordination between the national government and local governments is thoroughly conducted116through the electronic filing. Also reforming administrative procedures in line with technologicalinnovations such as big data and AI, and building efficient and effective institutions andprocedures for both of both business side and administrative side. Regarding issues necessary for
improving the business environment in Japan and methods for solving it, we will consider fromthe view point that why we are not able to do it in Japan but foreign countries are able to do. We
are aiming to make realizing “The best country in the world where companies are easy to moveinto action" through the regulation reform as the company’s side, the simplification of theadministrative procedure, integral promotion of the introduction of IT.
i)

Reducing administrative procedures costs thoroughly the government• Along with “Administrative Procedure Subcommittee Summary”, each ministry and agencies
aims to reduce 20% of the administrative procedure cost of businesses with business viewpointby March 2020. However, regarding "national tax" and "local tax" On the premise of realizationof electronic filing obligation realization, separate numerical targets such as electronic filing
utilization rate of large corporation such as 100% are set, and "cooperation on survey andstatistics" responds based on statistical reform basic policy etc. Each ministry and agency will
formulate a basic plan by the end of June this year and promptly start possible items. It willrevise the basic plan based on the opinion of the Administrative Procedure Subcommittee of theRegulatory Reform Promotion Committee and progress after formulated of the basic plan by
next March. Regarding the progress situation, the Administrative Procedure Subcommittee on
Regulatory Reform Promotion will follow up.
• Each ministry and agency will make plans for promoting medium and long term
e-administration including the on-line administrative procedures based on the "Digital
Government Promotion Policy" (May 30, 2017 IT Strategy Headquarters · Strategy Committee
for Promotion of Utilization of Public-Private Data) and the cross-governmental
implementation plan formulated this year by the first half of next year. In doing so, consider thepriority areas determined by the Regulatory Reform Promotion Committee Administrative
Procedure Subcommittee. In addition, it should show the direction of response to cross-section
themes like information sharing among government agencies collaborating between each officesystem and corporate information.
• The fields which are high demands of citizens and business operators, and are expected to havean early effect will be set as priority within this year. Implementing BPR as priority, it will
expand the results laterally and extend to other fields. In addition, as promoting IT and BPR for
local governments, working on communize and standardize operations, and expanding themunicipalities to introduce cloud system (1000 groups), and aiming to reduce information
system operation cost (30% reduction) by the end of this fiscal year.

ii) Providing public services in the digital era• Based on the My Number Card Utilization Promotion Road Map compiled in March this year, it
promote expanding usage of range of my number card such as increasing convenience of minor
portals by API cooperation etc., diversify access methods such as utilization of smartphone,introduction of regional economic support points by utilizing Mikey platform, introduction oftickets Promotion of private certification in cooperation with public personal certification,
promotion of the addition of her name to the face of the voucher and work infrastructure117

development.
• Regarding to the establishment of a corporation, we make it possible for users to process allprocedures online with one-stop. Therefore, making to complete all related procedures athrough on-line, considering from the comprehensive point of view of institutional andtechnical aspects, including the way of confirmation before the constitution certification, seal
impression notification, external cooperation API etc. The public and private sectors began toundertake full-scale examination, including utilization of private cloud services using external
cooperation API and acquire the result by this year.
• Regarding general trade procedures, concerning overall optimization to realize shortening ofcargo detention time, public and private consultation bodies to be examined from acomprehensive viewpoint such as institutional and technical aspects by government offices andprivate businesses gathered together, it will launch it by this summer and start discussing
promptly and get a conclusion during this fiscal year.
• In order to implement a prompt and efficient trial with considering other countries circumstances,from the comprehensive viewpoints including security procedure and security information in
the court, and we consider measures to promote IT in procedures for trials with user's point ofview, getting support of related organizations, and will conclude by the end of the current fiscal
year.
iii) Innovation of administrative procedures in line with technological innovation• We will start operating a one-stop application system (venture support platform) that can
speedily utilize government support measures by thinking in an entrepreneurial perspectivefrom this fiscal year. We also examine the one-only function of corporate basic information
through collaboration with corporate information and development to subsidies for small andmedium-sized enterprises, and acquire the certain direction about it during the current fiscal
year.
• For block chain technology, it will start anticipating of the advance introduction for government
information system in areas such as prefectural procurement and application procedures. For
those, we will consider issues related to operation and rules for realization to promote utilize
the system related to the electronic power of authorization letter, to construct a system of
distributed authentication of individual devices, to secure the authenticity of the data recordedin the block chain and public personal authentication and to promote the efficiency
improvement of procedures using smart contracts. Based on the result, for those operational
reforms with the newest technology we will formulate it realization of innovative electronic
administration that improves efficiency and convenience by the next fiscal year.
• About chemical substance examination, in order to reduce the burden required for the tests bybusiness operators, we are starting AI analysis of data which has been applied in this fiscal year
and aiming to eliminate screening tests related to animal experiments. And also, aiming tooperate a new system that leads to reduce of the burden of business operators and to be fasterand more efficient application processing in FY 2019.
• To implement steadily “Super Certified Offices” following high pressure gas security law toallow regulatory incentives for business operators such as monitoring constantly using IoT · big
data etc.. Also, in order to rationalize costs and digitization of information for both the public
and private sectors, it will work simplifying and IT conversion of the 250,000 amounts of118

applications every year handling as paper documents , aiming to start using electronic
application system within FY 2019.
• We will try to improve the business environment where private-sector companies with financial
and technical capabilities of mining sector such as petroleum and natural gas are easier toparticipate through simplification of administrative procedures and promotion of datautilization with mining area’s information by procedure’s digitization for registering mining
rights based on the Mining Act. We are aiming to start the system operation in fiscal year of2019.
• We aim to improve 20% of the productivity in the construction site by 2025 with promoting
i-Construction to fully utilize ICT etc. in the construction process from survey andmeasurement to design, construction and inspection, maintenance and renew, and shortened theinspection days of construction work to 1/5 using State-of-the-art technology, and reducing
inspection documents to 1/50.

1193. Corporate governance reform from “form” to “substance” and metabolism of industry(1) Main progress status of KPI《KPI》As for the ROA of large enterprises (TOPIX 500), we aim to reach a level comparablewith U.S. and European companies by 2025.
* KPI that we will newly set up this time(2)
Specific measures to be newly takeni) Promotion of measures to improve corporate value over the medium to long term
Due to the continuous efforts up to today, there has been steady progress in corporate
governance reform such as changes in compositions of boards of directors, investors’ proactive
attitudes toward dialogue with companies, and movements toward reducing cross-shareholdings.
However, compared to U.S. and European companies, Japanese companies have not reviewed
their business portfolios enough and still have room for improvement in terms of profitability. In
order for companies to improve their "earning power" and realize sustainable growth in thebusiness environment, which is rapidly altered by phenomena such as the rapid progress of the 4th
Industrial Revolution, company managements need to proactively take risks and carry out reforms
aimed at increaseing mid- and long-term values of their companies such as investment forstrengthening brand value, human resources, and research and develompent capability, and as
business restructuring. Such efforts shall be taken under the proper supervision by boards of
directors and other organizations and through "constructive dialogue" with investors that is basedon mid- to long-term perspective.
Therefore, we will encourage companies and investors to improve corporate value over themid- and long-term by deepening our efforts aimed at effective corporate governance reform andby carrying out regulatory reforms to accelerate decisive business restructuring.
① Improve corporate value through corporate governance reform
In order to further advance corporate governance reform by improving effectiveness of“constructive dialogue” between companies and institutional investors based on mid- andlong-term perspective, we revised the Japan’s Stewardship Code this year. In the revised code, weclarify the roles of asset owners such as pension funds and require investment managementcompanies to strengthen their governance and conflict of interest management.
In order to deepen corporate governance reform, which is one of the top agenda of Abenomics,
and move its focus from "form" to "substance", we will continue to encourage companies andinstitutional investors to leverage efforts including ones listed below, through considerations anddiscussions at the "Council of Experts concerning the Follow-Up of Japan’s Stewardship Codeand Japan’s Corporate Governance Code".
• Effective stewardship activities by institutional investors such as enhancing governance andconflict of interest management, enhancing disclosure of results of voting executions,self-assessment, monitoring of investment management companies, and high-value-added
dialogue that gives companies “awareness”.
• Efforts by listed companies such as provision of information beneficial for constructive dialogue
with investors such as management policies and strategies including their basic capital policies
and business condition and as more effective dialogue.
• Appointment/dismisal of CEOs in an objective, timely and transparent manner, organization of120

boards of directors with necessary qualities and diversity, management of boards of directors
with more focus on strategies, and proper evaluation for these efforts.
• Easy-to-understand disclosure of policies on shareholdings and reduction of shareholdings incases companies keep them without reasonable motivations..
From the standpoint of increasing international understanding of the efforts for corporate
governance in Japan, we will transmit information on these efforts overseas in a timely andeffective manner.
② Enhance management system and promote mid- to long-term investment• While disseminating "Practical Guidelines for Corporate Governance Systems" (CGS
guidelines) (formulated by the Ministry of Economy, Trade and Industry, March 31, 2017), we
will analyze and publish the status of utilization of nomination and remuneration committees incompanies, the status of recruiting of former managements as outside directors the status of
introduction and disclosure of incentive remuneration, etc. during this fiscal year.
• In Japan, even after presidents and CEOs retire from boards of directors, they conventionallycontinue to play certain roles such as engaging in external activities and giving guidance andadvice to their companies as counselors or advisers in their companies. From the viewpoint of
improving transparency regarding corporate governance, we will create a system to disclose
name, position/status, responsibilities etc. of retired presidents/CEOs who continue to play roles
as counselors, consultants, etc. in their own companies at the Tokyo Stock Exchange Co., Ltd.
around this summer. The new system will be implemented at the beginning of next year.
• In order to develop most desirable environment for dialogue from a global perspective, we aim
to realize a process for a dialogue-type shareholder meeting by continuing our efforts topromote electronic delivery of attachments to notice of convocation of shareholder meetingsand electronification of voting process in shareholder meetings and to develop environment forcompanies to set schedules and record dates for shareholder meetings reasonably andappropriately in relation to situations in other countries.
- In particular, as a part of efforts to develop environment for enhancing information
disclosure, we will discuss issues on allowing attachments to notices of shareholder
meetings to be provided electronically by default and obtain a conclusion at thesubcommittee established at the Legislative Council.
- We will work on the improvement and dissemination of procedures applied for special
extension of deadline for filing corporate taxes, which is aimed at allowing companies toschedule shareholder meetings flexibly. Also, we will follow up on the progress of theefforts for realizing a process for a dialogue-type shareholder meetings and transmit
information both in Japan and overseas.
• Based on the “Guidance for Integrated Disclosure and Company-Investor Dialogues for Value
Creation – For encouraging ESG integration and non-financial information disclosure andinvestment in intangibles” (formulated by the Ministry of Economy, Trade and Industry on May
29, 2017), we will analyze best practices of information provision and reporting by companies,
establish a venue for promoting such best practices, encourage institutional investors toencourage their investment management companies to make use of the guidance and havestakeholders improve access to non-financial information. In addition, we will demonstrate the121

"Environmental Reporting Platform”, which serves as a platform for dialogue between
companies and investors. Through these efforts, we will promote ways of information provision
including disclosure, of dialogue, and of investment that take into account ESG (environment,
society and governance) factors and contribute to improvement of corporate value in the midand long-term.
③ Improvement of the quality of disclosure of information by companies, accounting
and auditing
In order to build a vital capital market that realizes smooth provision of capital to companies
that seek sustainable growth and consistent growth of household assets, information necessary forinvestors’ investment decision needs to be provided adequately and fairly. In addition, suchinformation needs to be disclosed effectively and efficiently.
Due to progress of globalization and technological innovation, listed companies face
increasingly complex business challenges. In order to encourage companies to disclose
information in a more comprehensive and easy-to-understand manner in such an enviromnent, we
will carry out comprehensive examination on the issues of disclosure with hearing opinions froma wide range of stakeholders including companies and investors.
In addition, in order to secure reliability for information disclosure by companies, we willcontinue our efforts to improve quality of accounting standards used in Japan and to secure properaccounting auditing on business activities that are becoming ever more complex.
A) Improve the quality of information disclosure by companies
In order to ensure comprehensive provision of information necessary for investors to makeinvestment decisions, the related government bodies and the Tokyo Stock Exchange Co., Ltd. willcontinue to work together to have trans-system and cross-government discussions, and make thefollowing comprehensive examinations and efforts with the aim of developing an environment
which is designed to realize the most effective and efficient disclosure from a global standpoint
and set reasonable schedules and record dates for shareholder meetings by the first half of 2019.
• In order to enable companies to disclose business reports and annual securities reports in an
integrated manner, hearing opinions from companies, investors and other relevant parties, therelated government and other bodies accelerate their joint discussions on institutionalarrangements, interpretation of relevant rules, clarification and dissemination of ways tostandardize items among different disclosure rules and any other necessary measures fordisclosure items that have similar or related contents and can be commonalized among different
disclosure rules. A final plan will be set forth within this year.
• Based on discussions at the meeting of the Counsil on Investments for the Future on January 27
this year, we will set up a review meeting with companies, investors, relevant ministries andother parties at the Financial Council. At the meeting, while securing adequate and fairdisclosure of information in the changing environment surrounding market and disclosure, wewill make a comprehensive study on ways of disclosure of information such as strategies andgovernance that contribute to constructive dialogue between listed companies and investors, toimprovement of mid- and long-term corporate value, and to promotion of mid- and long-term
investment. Then, we will take initiatives in order on issues for which final plans have beendeveloped during the current fiscal year.

122• Formats for earnings briefing were revised in February 2017 for the purpose of increasing
flexibility of earnings briefing, of moving its focus to a role as an "early report", and of
encouraging diversification of earnings forecast disclosure. Based on the analysis of the effectof the revision and the international situation and discussion, hearing opinions from a wide
range of stakeholders including companies and investors, we will discuss problems and ways offurther eliminating duplications among disclosure rules and of improving efficiency. We willobtain an interim conclusion by around next spring.
• We aim to realize a process for dialogue-type shareholder meetings by continuing our efforts topromote electronic delivery of notices of convocation of shareholder meetings andelectronification of voting process in shareholder meetings and to develop environment for
setting schedules and record dates for shareholder meetings reasonably and appropriately in
relation to situations in other countries. [See above]B) Improvement of the quality of accounting standards
In order to improve the quality of accounting standards used in Japan, in corporation with
relevant organizations, we will promote necessary efforts such as promotion of expansion ofcompanies that volantarily adopt International Financial Reporting Standards (IFRS),
strengthening of international transmission of opinions on IFRS about issues such as goodwill
accounting, enhancement of the quality of Japanese standards and fostering of international
accounting specialists.
C) Securing of improved quality and reliability of accounting
In order to establish a virtuous circle in which auditing firms are appropriately evaluated bycompanies and shareholders for providing high quality accounting audit under effective
organizational management and aim to provide higher-quality accounting audit, we will ensuresustainable improvement and reliability of the quality of accounting audit by following up on
efforts of auditing firms based on the governance code for auditing firms (formulated by the
Financial Services Agency on March 31, 2017) and by examining management control systems ofauditing firms.
④ Smoothening of business restructuring
Amidst the change of the global business environment caused by the progress of the 4th
Industrial Revolution, in order to improve "earning power", companies need to review theirbusiness portfolio agilely and invest management resources in businesses that are expected to
grow and become profitable while deepening efforts for corporate governance reform. For thisreason, we will review a wide range of relevant regulations and take measures to promote boldbusiness restructuring such as agile review of business portfolio, including promotion of
restructuring by using stocks.
.
ii) Promotion of smooth supply of capital through realizing vital financial and capital
markets① Promotion of stable formation of assets by households and improvement of market
environment
It is important to make household financial assets into balanced portfolio in order to realize
flow of money that consistently increases the national wealth accumulated in our country. For this123

reason, we will take comprehensive measures on households and financial institutions.
To encourage stable formation of assets by households through long-term and diversified
investment with the use of regular investment in small amounts, we will disseminate and promote
the NISA, including the installment-type NISA, and enhance financial and investment educationthat leads to improved practical knowledge of investment in households.
Based on the “Principles for Customer-Oriented Business Operations” (formulated by the
Financial Services Agency on March 30, 2017), we will promote stable formation of assets byhouseholds by encouraging all financial institutions that sell/develop financial products tocompete in providing better financial products and services.
A) Promotion and dissemination of long-term and diversified investment with the use of
installment and enhancement of financial and investment education• In order to promote stable formation of assets by households, we aim to further promote anddisseminate the entire NISA system including the installment-type NISA. In addition, we willconsider improving procedure of the Junior NISA, taking into account voices that point out
troublesomeness of procedure of the Junior NISA.
• Also, in order to improve the knowledge (investment literacy) of investment in households, wewill promote practical investment education and consider how to provide information that isbeneficial for investors in comparing and selecting investment trusts. In addition, we will
promote the use of the defined contribution pension plan and the NISA in workplace to people
including those who have not previously been interested in asset building.
• We will encourage market participants’ efforts on improving the liquidity of the exchange tradedfunds (ETF) markets and on improving the recognition of ETFs so that ETFs can be used forconsistent growth of household assets.
B) Establishment of "customer-oriented business operation"
When financial institutions make efforts such as formulating an effective policy based on the"Principles for Customer-Oriented Business Operation", it is important that the efforts not only
take appropriate forms but also lead to substantial actions by financial institutions such ascompeting in providing better financial products and services. Therefore, the Financial Services
Agency will monitor whether there is a gap between policies and real practices of each financial
institution and consider publication of cases the agency has come to know through the monitoringin various forms. Also, the Financial Services Agency will encourage financial institutions to set
up and publicize KPIs in their policies so that those who can objectively evaluate how wellcustomer-oriented business operation has been established in those institutions. .
C) Responding to high-speed trading
In order to introduce regulations on high-speed trading of stocks and other financial products,
to which concerns are expressed in terms of market stability and efficiency, fairness among
investors, formation of prices that reflect mid- and long- term corporate value, and valnerability ofsystems, we will enforce the Act for Partial Amendment to the Financial Instruments andExchange Act and develop environment to ensuring fairness, transparency and stability ofmarkets.
D) Efforts aimed at promoting mid- and long-term investment
It is important to realize the virtuous circle of the entire Japanese economy by promoting midand long-term investment that results in sustained growth of investee companies and in expansionof returns for investors over the mid- to long-term.

124For this reason, we will work on promotion of long-term and diversified investment with theuse of installment, on further deepened corporate governance reform with its focus moved from“form” to “substance”, on introduction of registration system on high-speed trading, and on
introduction of the fair disclosure rule.
E) Improvement of convenience of financial and capital markets and their revitalization• In order to reduce settlement risks and improve market efficiency, we will encourage Japan
Securities Dealers Association to steadily advance their initiatives to implement “T + 1”
settlement of JGBs on May 1, 2018, and implement “T + 2” settlement of stocks and corporate
bonds on April or May 2019.
• We will continue the work of establishing a comprehensive exchange as early as possible and toensure smooth listing of electricity and LNG futures.
F) Responding to international discussions on financial regulation / Strengthening cooperation withoverseas authorities
We will make efforts to make international discussions on financial regulations consistent withJapan’s opinion that both sustainable economic growth and stability of the financial system should
be ensured. Also, we will raise our opinions internationally and contribute to international
discussions regarding the way financial regulation and supervision should be to deal with
common environmental changes in Japan and abroad, such as the low interest rate environment
and evolution of technology. In addition, in order to deal with globalization of activities offinancial institutions and financial transactions, we will strengthen cooperation regarding
supervisory and technological issues with overseas authorities and will steadily foster
pro-Japanese groups through accepting staff from financial authorities from emarging countries atthe “Global Financial Partnership Center”.
G) Promotion of the Tokyo Global Financial CenterIn terms of finance, it is important that Tokyo is recognized as an attractive business venue anddevelops as a hub that attracts human resources, information and funds from all over the world.
From this standpoint, the existence of the world's leading asset owners such as pension funds is
considered to be one of our strengths. Based on this, we will cooperate with the Tokyo
Metropolitan Government and encourage at the Financial Market Entry Consultation Desk foreign
financial companies to establish Japanese operations in an effort to realize “fast entry”, and tosmoothly process application for registration as financial business operators from overseas asset
managers who are expected to do business with Japanese asset owners.
In doing so, we will strengthen cooperation with overseas authorities and aim for the smoothand speedy registration of overseas asset management companies that have been successful inforeign markets.
Furthermore, in order to enhance the international presence of Japan and improve Tokyo’s
status as a global financial center, we will continue to provide necessary support to the IFIAR(International Forum of Independent Audit Regulators), which has established its secretariat inJapan for the first time as an international organization in financial field, for its smoothadministration.
H) Promotion and enhancement of the individual-type Defined Contribution pension plan
(iDeCo) and corporate pension
We will smoothly enforce the Act for Partial Revision of the Defined Contribution Pension Act
and familialize small and medium-sized enterprises with the revision. We will also promote and125

enhance the iDeCo and corporate pensions through disseminating the risk sharing corporate
pension plan and encouraging pension funds to accept the Japan’s Stewardship Code.
② Improve the quality of financial intermediation function
Financial institutions are expected to cope with the ongoing reduction and aging of population,
continued low interest rates and various environment changes surrounding management, andfinancially support sustainable growth of Japanese industries and companies. From this standpoint,
we will secure the soundness of financial institutions, enable financial institutions to fully
demonstrate their financial intermediation function even when economic or market stress arises,
and enable financial institutions to demonstrate high-quality financial intermediation function
such as providing companies with advice and financial services that are based on thoroughevaluation of their business potential and contribute to enhancement of corporate value of thosecompanies, leading those efforts to improvement of the competitiveness and productivities ofJapanese industries and companies.
A) Stable demonstration of financial function towards improvement of the competitiveness andproductivities of Japanese industries and companies
Financial institutions are required to financially support the efforts of Japanese industries andcompanies to improve their competitiveness and productivities and to promote their metabolisms
by flexibly addressing substantial economic and market changes and stably demonstrating thefinancial intermediation function. From this standpoint, we will encourage financial institutions toconstruct solid business administration and risk management systems and further strengthen theirfinancial bases. In particular, we will continue to request systematically important financial
institutions to reduce shareholdings in their customers and clients on a stable manner. Considering
the review of global financial regulations and the recent low interest rates, we will urge financial
institutions to make efforts to strengthen their management bases through business model changes
and reinforce their governance systems. Regarding regional financial institutions, based on thecontinued population decline in local regions, we will encourage those financial institutions toreview their own business models and take concrete and effective actions to build sustainablebusiness models to maintain soundness and to perform smooth financial intermediation functions
for the future.
B) Further enhancement and strengthening of financial intermediation function
A financial institution’s effort to support companies to improve their productivity, which inturns enables the financial institution to secure stable client base and earnings (creation of sharedvalues with clients), serves as a powerful option as a sustainable business model for financial
institutions and leads to the vitalization of the local economy.
From this point of view, we will take a range of measures and continue to encourage financial
institutions to make continuous and systematic efforts so that financial institutions may improvetheir lending attitudes relying excessively on collateral and guarantee appropriately evaluatebusiness nature and growth potentials of their customer companies (evaluation of businesspotentials) and provide customer companies with advice and finance that contribute toenhancement of values of those companies. (Refer to "III - 1. Innovation of Small-and-medium
Companies and Small Businesses / Vitalization and Improvement of Productivity of Service
Industry".)

126C) Supply of growth capital by public-private funds
While paying attention to the principle of subsidiarity and the principle of externalities thatpublic-private funds and government-affiliated financial institutions are required to comply with,
we will continue to consider initiatives that will enable them to exhibit their functions for the
purpose of promoting supply of growth capital from the private sector.

127

4. Opening public services and assets to the private sector (Expansion of utilization o f
PPP/PFI, etc.)(1)
Main progress status of KPI《KPI》Expand PPP/PFI business scale to 21 trillion yen for 10 years (FY 2013 to 2022).
Among them, the target for the PFI project utilizing the concession system istargeted at 7 trillion yen.
=> Business scale from 2013 to 2015 (figures as of January 2017)• PPP/PFI business: Approximately 9.1 trillion yen.
• PFI project utilizing the concession system etc.: approximately 5.1 trillion yen(2)Specific measures to be newly taken
Under the private finance initiative system, private business management approach is
introduced into the operation of public facilities. This will enable effective and efficientdevelopment and operation of infrastructure under severe financial conditions, thereby creatinglarge market and opportunities to strengthen international competitiveness for private companies.
In addition to continuing to achieve progress and numerical targets for airports, water supplies,
sewers, roads, educational facilities and public housing listed in “PPP/PFI Promotion Action
Plan (Revised in 2017)” ((Decided on June 9, 2017, private-sector funds utilization promotion
meeting, referred as "action plan" in this section), it is necessary to strengthen efforts to achieve
numerical targets for newly listed passenger terminal facilities for cruise ships and MICE
facilities.
For this reason, the fields targeted mainly by the concession systems are classified as "Fields
that respond to growing demand by growing domestic and overseas visitors such as airports,
educational facilities, passenger terminal facilities for cruise ships, MICE facilities” and “"Fields
that require sophistication of asset management and development of new business in response to
decreases in demand due to population declines such as water supply, sewerage, toll roads,
public housing, public power generation facilities, industrial water supply, and try to solve theproblems peculiar to each field listed below.
For this reason, it is important to establish a mechanism to transfer elements essential tobusiness between public and private sectors and also properly chosen the person who is
responsible for public services and assets from the government and the private considering for
taxpayers or users’ point of view.
And it is important to improve and elaborate this mechanism which is being trusted by private
enterprises that will be the leaders along with the government, we will also implement measures
to improve and implement the promotion system including guidelines and improvement
mechanisms for that purpose.
i) Measures to be taken in growth-oriented fields• On the premise of safeties, we consider depends on correspondence of the operation owners suchas clarification of introduction or operation of a mechanism enabling entry of non-passengers
into the security area of domestic routes, bringing kitchen equipment etc. to the same area,
making two stages of security inspection of domestic and international flights and relocating
CIQ facilities for the conversion.

128• Regarding the CIQ facilities where are separately owned between the country and theconcessionaire, we work on transferring ownership to the concessionaire and lend to thecountry. Also, we consider that enable to change the flexible layout in the terminal building
according to the correspondence of the concessionaire.
• Regarding the concession system at 7 airports in Hokkaido (Shin Chitose Airport, Hakodate
Airport, Kushiro Airport, Wakkanai Airport, Memanbetsu Airport, Asahikawa Airport, Obihiro
Airport), we implement necessary measures to ensure equal footing and to utilize the specificregional airport operator system from the perspective of sightseeing strategies such asformation of wide area tourism round route, and plan to select the concessionaire by 2019 withthe "5 principles" listed in the action plan.
• Regarding PFI Law, to make concessionaires who are not designated managers possible to allow
certain third parties to utilize within the scope of the purpose of establishing public facilities,
we will take necessary legal measures at the next ordinary diet session.
• About the passenger terminal facilities for cruise ship, to utilize concession system, we support
building a scheme team considering to overseas cases and user's needs for Fukuoka city's
waterfront redevelopment and concession project, and aim for formation of precedent cases.
ii) Measures for maturity-ready fieldsiii) • From the viewpoint of promoting the introduction for the water supply and sewerage theconcession system by the administrative authority local governments, we take necessary
measures to be applied for the PFI law from the next fiscal year to support exceptionally by
exemption / reduction of deposit, when a certain period is set up and the obligation in the projectis early redeemed at the consideration of the operating right through pioneering efforts that will
become a prime mover for lateral development,iv) • After the establishment of the draft law to revise Waterworks Act, based on the revised
Waterworks Act, we take necessary measures to concern the calculation method of fee cost on
the premise that private enterprises are involved in the operation of water supply businessconsidering for the opinions of related local governments, private companies, and experts.
v) • To organize a precedent case in the water supply business, we will consider measures forminimizing the new burdens for municipalities such as providing grants and subsidies only forcertain projects that we work on before the achievements of the business utilizing the concession
system is confirmed domestically. We will consider it in parallel with the enforcement situationof the supplementary budget for 2016 as well.
vi) • For public power generation facility, we will consider whether to designate as the priority area
and to set numerical targets and will conclude it during this fiscal year.
vii) • As a pioneering effort to turn forestry into a growth sector, we solicit proposals for
improvement in national forest from private business operators with necessity data, in order toverify the possibility of a method of selling the trees more advantageous by collectively
managing from the procedure from the logging to the sales at the long-term / large lot by private
business operators.
iii) Measures for development of the promotion structure and the operation• Based on the study in relevant ministries, by the end of July this year, of the ideal form ofcontract, Cabinet Office will consider the necesity of legal grounds for the facility manager's
payment. This is to enable the manager, in contract, to comit the payment of a specific sum of129money to the concessionaire such as to cover warranty against defects, refund operation fee,and purchase necessary assets at the expiration of contract which leads to the scheme forappropriate risk sharing between public and private sectors. If necesary, Cabinet Office willtake required measures for PFI law by the next ordinary Diet session• In the water supply and sewerage business, to make a system which allows to pass-through pricefluctuation to the fee when the fluctuation exceeds a certain defined range, related ministries
will clarify the definition of price fluctuation and the formula for its shift to the fee by the endof the year, and establish the scheme for proper utilization such as stipulating them in therelated manuals and permission standards. Based on this, the Cabinet Office preparesguidelines.
• Regarding appropriate market sounding methods (information and items to be disclosed,
methods of dialogue, etc.), including the results of review through overseas case surveys byrelated ministries and agencies and hearings with stakeholders until the end of July this year,
the Cabinet Office prepares guidelines.
• In the case where the concessionaire is asked to take over the existing businesses other than theadministrator, making sure not to take over exceeded risks to the concessionaire, the Cabinet
Office prepares guidelines.
• Regarding the review committee that selects the concessionaire, the relevant ministries andagencies will consider the future course of action to the rule-making to publish the minutes inprinciple, and the Cabinet Office will confirm the intention of the private enterprise side by theend of July this year and formulate guidelines if there is no problem found in the confirmation
process.
• Refer to cases of overseas and efforts of similar fields, from the perspective written in "Action
Plan" in the end of July this year, the relevant ministries and agencies will examine how to
calculate VFM (Value For Money: providing the most valuable service for payment), how to
pay consideration and evaluation method. Based on the result, the Cabinet Office preparesguidelines.
• Regarding the capital contribution by the local public entity to the concessionaire and theinvestment capital by a specific company, except for the cases where the necessity is clear andit cannot clearly respond to the necessity in a method other than investment, do not accept it.
Even if you allow investment, we will not assign conditions such that the amount of funds
procured by the bid participant becomes uncertain by requesting excessive shareholder
authority against the investment amount, based on the result, the Cabinet Office preparesguidelines.
• In promoting the PFI project utilizing the concession system, because the following "5principles" are necessary, regarding the function and authority of the Cabinet Office and theway of organization for exercising its authority (including the composition of external neutral
specialized agencies), we will consider cases of foreign countries, if necessary take required
measures for the PFI Law by the next ordinary Diet session.
(i) Operation and compliance with guideline rules thoroughly
Summarizing rules that should be observed by the concession system beyond discipline in
the guidelines based on public and private debate, it should be a mechanism to have thispractice done thoroughly in individual projects.
(ii) Hands-on support from entrance to exit

130

It should be a system that works together from the start to the end of the project and support
thoroughly to administrators with poor knowledge such as local public entities that make thefirst use of the concession system.
(iii) One-stop consultation with relevant ministries and agencies
When negotiating with related ministries and agencies, an administrator who work as theconcession system with a new field or new approach, there should be a system that allows
administrators to make consultations as one stop as possible.
(iv) Establishment of PDCA cycle
In all projects of the concession system, it should be a system that can clarify points ofimprovementin selection process from the position of both the public and private sectors byreviewing it after the selection of the concessionaire and to reflect them on the guidelines.
(v) Ensure coordination and arbitration function between administrator and concessionaire
Even after the start of business of the concession system, it should be a system that canconstantly create new efforts by collecting the requests for improvement from theconcessionaire and sharing them with administrator.
• In addition to these, regarding each effort relating to the concession system listed in the action
plan, the related ministries and agencies will work together in cooperation.
• Regarding systems and individual projects relating to the concession system in Japan, we
publicize to local governments and hold explanatory meetings for business operators andinvestors in domestic and foreign major cities.

1315. Bold Regulatory Reform by the National automated drive Special Zone
(1)
Main progress status of KPI《KPI》Japan will be marked in the third rank for bank’s business environment ranking in
the developed country of the world by 2020.
=> It is marked 26th in October 2016 (2 rank down compared to the previous year)《 KPI》Aiming to be ranked 3rd in world’s city's comprehensive strength ranking
by 2020. (4th in 2012)=> 3rd ranked as published in October 2016 (1 rank up from a year before)(2) Specific measures to be newly taken(Accelerate Promotion of National Strategy Special Zone by Reform of Remaining "RockRestriction" etc.)
In National Strategy Special Zone, based on the National Strategy Special Zone Act which
was established in December 2013, we have made a breakthrough in so-called rock regulation in
general with two years to the end of fiscal 2015 as the intensive work period.
Also, since last fiscal year, in order to accelerate the "second stage" of In National Strategy
Special Zone, as two years to the end of fiscal 2015 as the intensive work period, we have set as"new goal" to reform the remaining "rock regulation", mainly in 6 fields and matters such as"Promotion of acceptance of foreign talent in a wide range of fields".
Regarding the regulatory reform matters realized by the National Strategy Special Zone so far
became more than 70 including nationwide measures, especially we have made regulatory
reform that could not be realized for many years, for instance, speed up procedures for urban
planning, liberalization of so-called private accommodation (housing that can be accommodated),
establishment of medical department, establishment of regional nursery teacher system,
clarification of employment conditions (establishment of employment labor consultation center),
private school openness of public school, administrative division of agricultural committee
Review.
In addition, there are 10 areas ("Tokyo area" (Tokyo, Kanagawa Prefecture, Chiba-shi andNarita-shi (Chiba Prefecture)) "Kansai area (Osaka Prefecture, Hyogo Prefecture, Kyoto
Prefecture), "Niigata-shi (Niigata Prefecture)", "Yabu-shi (Hyogo Prefecture)”, "Fukuoka-shi
and Kitakyushu-shi (Fukuoka Prefecture)", "Okinawa Prefecture", "Semboku-shi (Akita
Prefecture", "Sendai-shi (Miyagi Prefecture)","Aichi Prefecture", "Hiroshima Prefecture,
Imabari-shi (Ehime Prefecture)" which we have designated over the period from May 2014,
August 2015, last January and the third, Total of 242 projects were approved by the Prime
Minister through the National Strategy Special Zone Conference (referred as "Area Conference")
and the National Strategy Special Zone Advisory Council held 83 times, respectively, they aredramatically improving now.
Furthermore, in addition to regulatory reform matters included in "Japan revitalization
strategy 2016" in March this year, based on regional conferences and proposals solicited from allover the country, we are submitting to the National Assembly a bill to revise the National
Strategy Special Zone Law, which sets forth new regulatory reform matters centering on the132mentioned 6 fields and matters.
i)Implementation of prompt businessIn the current 10 designated areas, we will make full use of regulatory reform matters based on
the National Strategy Special Area Act and to realization concrete business in a visible form as
quick as possible, and give a strong encouragement to related local governments.
At that time, we will consider the evaluation of the efforts until the end of last year and willlead it to further reform, we will manage progress by PDCA cycle with strictly evaluating theoutcome of the reform at the National Strategy Special Area Special Advisory Council followed
this law and "Basic policy of national strategy special area" (decided by the Cabinet, February 25,2014).

ii) Addition of further regulatory reform items
Regarding the National Strategy Special Zone, particularly, including the 6 areas and mattersthat should be focused on above, in addition to regulatory reform proposals solicited from all overthe country, regarding the following regulatory reform matters such as the establishment ofregulation "sandbox" system, at the National Strategy Special Area Advisory Council and the
National Strategy Special Zone Working Group, we consider to newly add to the National
Strategy Special Area Act and take legal action promptly including submitting of next Diet.
On that occasion, proposals from areas not designated as a national strategic special zone, as
well as proposals that did not become measures in the national strategic special zones, asnecessary, "under national scale or at least a special zone from the viewpoint of realizing reform,
actively consider as a nationwide regulatory reform measure or as a regulatory reform measure in
the Special Zones for Structural Reform / Comprehensive Special Zone, and realize it.
Also, based on the basic policy of the national strategy special area "We will make proposal
solicit at least twice a year", this year we will also invite proposals from local governments andprivate sectors nationwide during the summer.
(To promotion of demonstration of "near future technology", establishment of regulation "sandbox"
system, etc.)① Rapid creation of regulation "sandbox" system by establishment of "post-check rule"• By conducting "demonstration of near-future technology" that frequently draws on Japan's
growth strategy and the 4th industrial revolution in the National Strategy Special Zone withhigh frequency, it is important to encourage new innovations launched by local and first timeever.
• For this reason, we continue to vigorously demonstrate near-future technologies such as
automated driving, small unmanned aerial vehicles (drone), in order to carry out thesethoroughly more smoothly, fundamentally review relevant preliminary regulations andprocedures in the National Strategy Special Zone, referring to "regulatory sandboxes" in othercountries, we will promptly realize the establishment of regulation "sandbox" system.
• Specifically, based on the provision of the National Strategic Special Zone Law amending billsubmitted to the current Diet session, concerning concrete measures, we will promptly examine
within one year from the enforcement of this measure, with the results, we will eliminate the133preliminary regulations and procedures related to existing laws and regulations or reduce themto the minimum necessary by establishing "post-check rules" such as information disclosure,third party / expert monitoring, evaluation, dispute settlement system.
② Accelerate promotion of public road demonstration experiments to realize "fully
automated driving"• Based on “Japan revitalization strategy, revised 2015” and “Japan revitalization strategy 2016”,
at the National Strategy Special Zone, we have been conducting demonstration experiments on
automated buses in Semboku City in November last year and holding the first "Sandbox
Subcommittee" in Tokyo (Ota Ward) in March this year. We will continue to conduct
demonstration experiments including cases involving necessary regulatory reforms at a highfrequency and verify the effect.
• Moreover, in order to aim at technology development up to so-called "fully automated driving(level 4, 5)", in order to make a realization public road demonstration related to mobile services
by automated driving in Special Zones within this year,- On public road demonstration experiment of remote type automatic traveling system, review
and clarify regulations and procedures concerning road usage permission under the Road
Traffic Law under further cooperation with the Special Zone Municipality.
- On public road demonstration of vehicles not equipped with handle, accelerator and brake
pedal under the cooperation with the Special Zone Municipality, review and clarification ofregulations / procedures related to safety standards (alternative safety ensuring measures)
under the Road Trucking Vehicle Law).
We consider all above and take necessary measures as soon as possible.
• In addition, as a new institutional and technical problem relating to automated driving based onrequests from private business operators who intends to carry out experiments,- The way of responsibility for accidents etc. (Currently, driver's individual) at public roadexperiment- Providing it with Smoothly to provision to special zone municipalities and business
operators on the assumption that the signal information cannot be detected by a camera on
the vehicle- Realization of time sharing of cargo / passenger vehicles
In the National Strategy Special Zone working group and regional meetings of each Special
Zone, we will organize issues as soon as possible to realize the project.
• Furthermore, after establishment of the revision bill of the National Strategic Special Zone Law
as mentioned above, we will respond to various consultations related to the relevant laws andregulations and provide information to private business operators, as prescribed in the same bill,
we set up a "one-stop center for technological demonstration of the near future" that will also
perform proxy procedures if necessary, under the regional meetings of Tokyo, Semboku City
and Aichi Prefecture.

134

③ Accelerate promotion of demonstration experiments on drone• Based on “Japan revitalization strategy, revised 2015” and “Japan revitalization strategy 2016”,
in the National Strategy Special Zone, We have carried out demonstration experiment in Chibacity in April last year and Semboku city in July, but we will continue to conduct demonstration
experiments including cases involving necessary regulatory reforms at a high frequency andverify the effect.
• As for the drone, although it is aimed to realize out-of-sight flight in areas expected to haveneeds such as mountain areas around next year, regarding the demonstration experiment in thenational strategic special zones such as the coastal sea in Chiba City scheduled for this year, itis necessary to minimize preliminary regulations and procedures with ensuring safety whileaiming at achieving the goal ahead of schedule.
• Specifically, for example, considering the maintenance of various devices for drone to safely
landing on water and the obligation to operate by experts, with seeking specific concrete
security measures for the special zones municipalities and project implementers, we promptly
set up the aforementioned "one-stop center for technological demonstration for the near future"under the area meeting of Chiba city and we adjust with ship related personnel including fisheryand wide range of related organizations such as the Ministry of Land, Infrastructure, Transport
and Tourism quickly and smoothly.

(Promotion of 6 fields and matters to be focused on, such as promotion of acceptance of "foreign
talent" in a wide range of fields)④ Promotion of acceptance of "foreign talent" in a wide range of fields• Regarding the acceptance of "foreign talent" at the national strategic special zone, we haveincluded special measures about "housekeeping support human resources" and "founding
talent" included in the National Strategy Special Area Law Amendment Law revised in July
2015.
• We will continue to steadily recognize the business plan concerning acceptance of these foreign
talented personnel, in order to stimulate related industry and inbound correspondence, regarding
other wide range of foreign talents to be accepted in the Special Strategy Zone for National
Strategy, we will proceed with necessary studies based on proposals from local governments
and the private sectors.
• In particular, when implementing the Project to Accept Foreigners for Agricultural Support in
National Strategic Special Zones, under proper management with "council" consisting of local
public bodies and administrative agencies of the nation as the core, supporting foreigners
working on agriculture with skills for the maximum 3 years, by dispatching the personnel froma specified organization that signs an employment contract to an agricultural management bodyand engaging in agricultural support activities, we promote the various crops production in the
production area, and we intend to achieve the growth industrialization in agriculture andstrengthen international competitiveness through the expansion of the scale of business.

135

⑤ Promotion of acceptance of "foreign talent" in a wide range of fields in Fintech field• In order to promote the entry of foreign companies into the Fintech sector to strengthen theinternational financial functions of the city, under the support of local public entities, weconsider how to respond to foreigners who established a network with domestic financial
institutions and investors to continue their founding activities without returning home and draw
a conclusion this year.
• In order to further promote acceptance of foreign talent, in advanced personnel point system,take special additives as soon as possible, and we will examine how to satisfy the obligatory
requirements of parents and domestic employees of said personnel and obtain conclusions thisyear.
⑥ Review of lighting regulations that promote diversion from existing office to nurseryschool• In order to promote diversion from an existing office to nursery school as the zero-waiting list
for children, in the case where use is also made in consideration of a childcare environment for
the regulations concerning the window for daylighting of the Building Standard Law required
for each nursery room, we promptly take the required measures so that we can divert officerooms without sized windows that are effective for daylighting regulations to nurseries.
iii) Addition of specified area
We will promptly respond to regulatory reform proposals by local governments and private
sectors nationwide, and make realization for each concrete business, and the enthusiastic local
public bodies will be proposed of the 4th order designation in the national strategic special zones
with suggesting bold regulatory reform items by the middle of this year.
In order to promote reconstruction assistance and innovation based on afflicted areas in disasterareas, efforts to utilize various near future technologies are actively carried out. In addition, these
efforts are expected to revitalize afflicted areas, mainly in primary industries and tourism fields.
From this point of view, it is necessary to positively consider the designation of the area
including the disaster area, especially regarding the 4th order designation of the special strategic
zone of the national strategy.
iv) Drastic reinforcement of PR activities related to success stories examples
Possibility of efforts towards economic growth and regional revitalization through regulatory
reforms for local public entities and private enterprises other than designated areas by aiming tofundamentally strengthen public relations and PR activities such as success stories in the National
Special Strategy Zone, and will expand the effect of the National Strategy Special Zone to thewhole country.
In particular, we encourage expanding organized symposium by the Cabinet Office / Local
Public Organization, and creation of TV programs / broachers. In addition, Currently, bystrengthening the structure through the "Special Zone Promotion Collaborative Secretariat"
between the Cabinet Office and the Special Zone Municipalities established in the Tokyo
Metropolitan Government and Yabu City, fundamentally strengthen the public relations
comprehensive strategy for each special zone.

136

6. Secure cyber security(1)Main progress status of KPI《 KPI》By 2020, we aim for more than 30,000 registrants of Information Security
Assurance Support Professionals=> April 1, 2017: 4,172 people(2)

Specific measures to be newly taken
In the super smart society where people can live comfortably and abundantly in all situations,securing a safe cyber space is an important foundation for economic and social activities inSociety 5.0. Although it is expected that the convenience of the citizen's life will be further
increased in the future by incorporating innovation through data utilization and the like into thesociety, while the advancement and scale-up of attack methods against the background oftechnology development, Threats on cyber security are definitely increasing due to the
expansion of protection targets. Therefore, cybersecurity measures will be "investment in the
future" indispensable for achieving thorough measures at the Tokyo Olympics and Paralympic
Games in 2020 and ensuring the stability of economic and social activities. We will consider
efforts not only cyber security strategy, also we should encourage public and private sectors
promptly and strongly with enhancing government agencies and important infrastructure,enhancing IoT security, training and securing of reliable security human resources.
In particular, regarding important infrastructure such as information communication, electric
power and finance, if the function stops or declines, it may have serious adverse effects on
people's lives and corporate activities. Not only for the faults / accident information, including
information that seems to be the predictive stage, by considering a framework etc. thatstrengthens coping measures related to cyber-attacks, such as aggregating information widelyfrom various fields, it is necessary to secure safe and sustainable provision of important
infrastructure services.
• Based on "Summary of cybersecurity in view of 2020 and the subsequent" will be compiled by
Cyber Security Strategy Headquarters by this summer, for the 2020 Tokyo Olympic Games andthe Paralympic Games, government agencies intend to enhance efforts on important
infrastructure, enhance IoT security, nurture security human resources, and enhance cybercrime/ cyber-attack measures.
• For important infrastructure protection, based on "4th Action Plan on Information Security
Measures for Critical Infrastructure" (April 18, 1992 Cyber Security Strategy Headquarters
Decision), we will materialize it from the safety and sustainable provision of services. Including
this, in order for the Cabinet Cyber Security Center (NISC) to act as a nodal point for
promoting public and private partnership activation, we will utilize specialized institutions andother means to concentrate and analyze information related to cyber incidents including not
only information on disability and accident but also information that seems to be the predictive
stage, to connect the information to countermeasures, we will draw a conclusion during thecurrent fiscal year on the framework to strengthen the coping situation concerning cyber-attacks
and promptly take necessary institutional measures.
• About the concept concerning the design, development and operation of the IoT system, incooperation with the public and private sectors in Japan, we promote incorporation into various

137

criteria concerning mono / network and system. Also, we actively work on international
standardization through the realization of safety and high quality IoT system based oninternational standards, and aim to strengthen international competitiveness. In addition, toenhance the security measures of IoT equipment, it is necessary to grasp continuously andextensively the actual situation, implement and inform measures for users and public andprivate relations to promote measures to prevent similar damage, we will establish a frameworkof cooperation by parties during this fiscal year and promote necessary measures.
• Based on the "Cyber Security Human Resource Development Program" (determined by Cyber
Security Strategy Headquarters on April 18, 2017), we will promote various workforce
development measures. Such projects include the training of the core workforce in major
infrastructure and industrial infrastructure, practical exercises for government/public agencies/
major infrastructure operators, and discovery and development of young people whilestrengthening collaboration among measures.
• In order to promote the revitalization of the security industry, we will promote efforts from bothdemand and supply, and create a virtuous circle. Regarding demand side, by encouraging thegovernment to clarify the fields of security products and services that should be procured
positively and revising the list and encouraging use of cyber security management guidelines.
In addition to promote further awareness reform of the management group including small andmedium-sized enterprises, we will promote security investment in companies with a view to
growth of related industries such as IoT industry. For the supply side, we have established asystem for certifying security products and services with certain quality during this fiscal year.
With these efforts, we will try to enhance the technologies based on the "cyber security R & D
strategy" formulated during the current fiscal year, promote the spread of security by-designs
and intend to strengthen the international competitiveness of the security industry.

138

7. Sharing Economy(1)Main progress status of KPI《KPI》Creating Sharing Economy Utilizing examples of local public bodies at least 30
areas during 2017.
* KPI that we will freshly set up this time(2)

Specific measures to be newly taken
Sharing economy is a broad business that shares idle assets such as goods, space, knowledge,
wisdom, and skills, which are not used enough, using ICT, it is expected to contribute torevitalizing the Japanese economy by creating new business areas, improving the convenience ofthe people's lives, and revitalizing the regional economy by implementing a new living industry.
The sharing economy in Japan is in the predawn, although various services will be expected toappear in various fields in the future, on the other hand, it is also easy to assume that problems
that were not supposed to be generated occur. For this reason, at the Sharing Economy
Promotion Office established in the Cabinet Secretariat in January this year, we will promote thespread of sharing economies by maximizing respect for creativity and ingenuity in the private
sector, it is necessary to conduct studies together to secure safety and security. Specifically, in
addition to promoting the spread of voluntary guidelines to secure safety and security, andsupporting the utilization of the gray zone elimination system, it is required to promptly conduct
necessary studies and the like when cross-cutting issues arise.
Also, the sharing economy has spread rapidly overseas as well, because there is a movementof examination toward creating international rules by public-private partnership, we should
contribute to the formation of international consensus through active dissemination of cases ofJapan's efforts in the future.
• Mainly in the sharing economy promotion room established in January this year, based on the"Sharing Economy Promotion Program" (Interim Report of the Sharing Economy Review
Conference, November 10, 2016), enhancing secure of safety and reliability of sharing
economies by dissemination of voluntary rules by private organizations, we participate inplaces such as creating international rules through public-private partnerships that are expected
to become full-scale debate in the future, and contribute to the formation of international
consensus through active dissemination of examples of Japan's efforts.
• In the sharing economy promotion room, we will provide necessary information provision andadjustment, utilization of gray zone elimination system concerning interpretation of laws,
responding appropriately to consultation from private enterprises, local public entities, etc. In
addition, when there is a necessity of reviewing measures by these consultation correspondence
and progress or change of future sharing economy, cross-cutting issues, we will consider asnecessary.
• In order to solve local social problems using sharing economy and revitalize regional economies
by implementing new living industry, Sharing Economy dispatching municipalities to local
governments and promoting maintenance during the current fiscal year of matchingmechanisms between private enterprises and local public entities, we aim to create examples ofmodel sharing economy utilization in at least 30 areas during this fiscal year for each local
public entity that has different tasks such as metropolitan area, regional core city, and139

depopulated area. We compile the extracted best practices within this fiscal year and promotehorizontal development and dissemination awareness to wide range of local public entities.

140III. Construction of a regional economic virtuous circulation system
1. Innovation of Small-and-medium Companies and Small Businesses /Vitalization and Improvement of Productivity of Service Industry(1)
Main progress status of KPI《KPI》Increase the number of small-and-medium companies in the black and small
businesses from 700,000 to 1.4 million by 2020=> FY 2015: 923,037 companies (FY 2014: 859,753 companies)《KPI》Aim to increase the rate of increase of labor productivity of the service industry to
2.0% by 2020 (0.8% in 2013)=> 2015: 1.3% (2014: 1.0%)(2)Specific measures to be newly taken
The key to the local Abenomics is to increase the added value and improve productivity ofsmall-and-medium companies and small businesses as well as the service industry that support
local employment and economy.
Businesses are rooted in local community, have excellent sense of real working places, andare able to respond speedily and flexibly to the changes in the environment including industry
structure. However, they are also facing a sluggish growth of productivity and labor shortage.
The extension of the circulation of “human beings, things, money, and data” in and outside ofcommunities to local businesses has been insufficient, which has to be improved. In addition,
employment and income need to be locally generated, and local economic structure must be
established which is truly independent and have resistance to economic and environmental
fluctuations. Revival of small-and-medium companies as well as small businesses that faceahead of all the challenges confronting the Japanese economy must also be realized. These willserve as the touchstones for the revival of Japanese economy.
For this purpose, we will first promote investment and innovation to radically improve theon-site productivity of added values of small-and-medium companies and small businesses aswell as the service industry. In order to achieve this, we will work on computerization andintroduction of robots as well as use of data.
Second, through the use of finance functions and establishment of a consistent support system,
we will promote efforts on improvement of productivity, smooth revival and succession ofbusinesses, and appropriate metabolism. With the smooth succession of businesses, we will get
through the period when many business managers of the baby-boom generation retire, which isanticipated to come around 2020. Credit guarantee system will be reinforced to encouragebusiness managers to improve their management and productivity as well as to motivate
financial institutions to appropriately evaluate business potential and support management. We
will promote financing which is operated based on the evaluation of business potential byfinancial institutions and which is not too dependent on securities and guarantees, and accelerate
the supplying of growth capital. These will be pursued through mutual collaboration among
various supporting organizations, as well as enhancement of functions and improvement ofquality thereof.

141

Third, local industries with high business potential as well as high-quality employment andwages create a virtuous circle, which further attracts investment and human resources to the
local communities. We will provide support with a focus on the core companies and the group of
their transaction partners that sell a large quantity of goods outside of their communities but
procure most of them in their communities. While aiming to improve productivity of suchcompanies as well as to vitalize the local economic spheres, we also aim at winning external
demand. Our goals are to achieve integrated development of small-and-medium companies aswell as small businesses in the local spheres. In the fields of growth of local communities suchas tourism, sports, culture and art, and cutting-edge manufacturing, we will strongly support
deliberate and “locally organized” efforts of people related to the local communities, including
local governments and core companies. We will support the growth of local communities bypromoting efforts of vitalization thereof including expansion of cross-generational interaction,using human resources through dual employment, using people who grew up in cities but wish
to be employed outside of cities, and cultivating human resources who engage in management.
With these efforts, we aim to expand “future investment to the local communities”, and expand
investment by one trillion yen and lift GDP by 5 trillion yen in about 3 years.
Further, we aim at new development of creation of local communities based on the “General
Strategy on Creation of Town, Human Resources, and Employment (2016 Revised Edition)”(approved by the Cabinet on December 22, 2016) and “Basic Policy on Creation of Town,
Human Resources, and Employment 2017” (approved by the Cabinet on June 9, 2017).
i)

Promotion of investment and innovation which radically improve the on-site
productivity of added values of small-and-medium companies and small businesses aswell as the service industry• Making use of know-how such as “kaizen activities” in manufacturing industry, we will promotea nation-wide movement to develop specific know-how, extracted for each category and type ofindustry, for the improvement of labor productivity for small-and-medium companies and small
businesses as well as the service industry. This will be promoted through the activities of the“Council for Promotion of Nation-wide Movement for Improvement of Productivity” which
was launched by public-private partnership in May this year.
• The government will provide expert support for IT and robot introduction to more than 10,000
companies by the end of this fiscal year, aiming at the creation of new services and added value
using data from SMB and SME in manufacturing industry. The government will also encourage
initiatives to develop bases that allow businesses to receive consultation from the "Smart
Manufacturing Support Team", which provides consultation on the improvement of
manufacturing sites and also provide assistance in the utilization and introduction of IoT/robots,with an aim at setting up such bases at about 40 locations nationwide within two years. In
addition, the government will promote measures to strengthen training in its effort to double thenumber of "system integrator" that proposes and supports SMEs and small businesses in theirrobot introduction to 30,000 by 2020.
• In order to promote “smartification” of small-and-medium companies and small businesses
while establishing a common platform, added values need to be increased and services need to
be streamlined for many small-and-medium companies and small businesses by introducing IT
cloud services. In order to achieve this, we will examine additional measures for promotion to142

be implemented through “visualization” of effects of productivity improvement and security
measures based on IT cloud services, coordination between services, corporate transactions(EDI), and promotion of improvement of work process. The examination will be implemented
with a view to cooperating with the organizations supporting managerial innovation as well as
the organizations promoting sectoral improvement of management based on the Act on
Enhancement of Management of Small-and-Medium Enterprises. We will reach our conclusionby the end of this year.
• With a view to maximizing the effect of approaches for each category of industry based on the
Act on Enhancement of Management of Small-and-Medium Enterprises, ministries concerned
will coordinate with the Small and Medium Enterprise Agency. In order to enhance workability
for each category of industry, they will systematically implement establishment of guidelines
for the improvement of productivity appropriate to the features of each industry category as
well as establishment of a system for coordination with and promotion to the leading tradeassociations for each industry category. Based on the follow-up on the circumstance of
implementation, we will take institutional measures including establishment of basic principles
based on the Act as well as business sectoral guidelines in the fields where productivity is low.
We will back up the improvement of productivity of small-and-medium companies and small
businesses, including the service industry, based on the “aggressive investment”. Next year, we
aim to make a capital investment of 14 trillion yen, which is more than the amount invested
before the collapse of Lehman Brothers.
• We need to address the issues of technical development of small-and-medium companies andsmall businesses and their accommodation to the 4th industrial revolution in their businessdevelopment. For this purpose, we will review the framework of technical development(including the guidelines for the Act on Sophistication of Manufacturing by Small-and-Medium
Enterprises) by the end of this fiscal year to further incorporate technical innovations such as
IoT and AI and promote improvement of added values.
• With a view to increasing the added values of the service industry, we will prepare, by the end of
this year, the “Standards on Omotenashi (hospitality) Skills (provisional title)”, which list theskills required of the human resources engaging in the service industry. We will spread thesestandards along with the “Authentication of Omotenashi Standards” that we aim to disseminate
to 300,000 companies by 2020. We will also consider necessary corrective measures for thecommercial practices whereby payment of appropriate remuneration for good services ishampered and the improvement of productivity of businesses is strongly constrained. We willdraw a conclusion by the end of this fiscal year.
• Based on the Guidelines on the Subcontract Act, to which we added significant number ofviolation cases last December, Standards for Promotion concerning Subcontracting based on the
Act on the Promotion of Subcontracting, where desirable transaction practices are added, as
well as the requirement of payment of subcontract proceeds in cash as a rule, we will promote
efforts on fair transactions and increasing of added values in line with the independent actionplans of major industries established by the end of last fiscal year (for 8 categories of industry
including automobile, electric appliance and electronics, truck, and construction). Through theinvestigations of investigators for subcontracting, we aim to steadily improve the trade terms of
subcontractors. With respect to the categories of industry which have their independent actionplans, we will provide more certifications for the organizations promoting improvement of143

management for each business field, based on the Act on Enhancement of Management of
Small-and-Medium Enterprises.
ii) Improvement of productivity, smooth revival and succession of businesses, and appropriate
metabolism through the use of finance function and establishment of consistent support
system• We will encourage local financial institutions to more proactively engage in providing of growth
capital to local companies, supporting of management (including human resources andknow-how), and overall vitalization of local economy, in cooperation with the relatedorganizations. We will further promote efforts on improvement of local financial institutions’judgment, as well as public-private funds and government financial institutions’ efforts onproviding growth capital that would encourage investment and loan by private financial
institutions. • There will be enhanced provision of equity funds and hands-on support by funds
jointly operated by local financial institutions and Regional Economy Vitalization Corporationof Japan (REVIC) or Development Bank of Japan (DBJ). More risk money will be provided
based on cooperation between DBJ and local financial institutions. Know-how will be furthertransferred and more widely used through dispatching of professional staff from REVIC tolocal financial institutions. With the use of Japan Human Resources, there will also be enhanced
support on human resources.
• We will accelerate provision of growth capital by promoting financing which is not too
dependent on securities and guarantees and which is operated based on the evaluation ofbusiness potential by financial institutions. In order to promote efforts on the improvement of
productivity of both financial institutions and businesses, we will promote dissemination tobusinesses of “Benchmark on Functions of Financial Intermediation”, “Local Benchmark”, and“Guidelines on Management Guarantee” through organizations that support small-and-medium
companies, and encourage financial institutions to disclose the circumstance of their use thereof.
The government will work as one to promote dissemination of these to and use thereof by bothfinancial institutions and businesses.
• In addition to the traditional support on business transfer, providing support to business
operators in early and systematic business succession (pre-support) and providing support tobusiness successor in management innovation after they take over the business (post support),and so on, with the next 5 years set as the intensified implementation period. We will radicallyenhance measures by taking measures such as to newly introduce a method of assessment on
business transfer which is easy to understand and make 50,000 assessments per year. With asupport from the Business Transfer Support Center, we aim to have 2,000 M&As concluded peryear (five times as many compared to the previous years). Based on the actual situations ofincreasingly diversifying business transfers of small-and-medium companies and small
businesses, we will continue to consider actions to take in terms of business transfer systems
while verifying the effects of tax systems for business transfer. Moreover, in order to secure
growth of local communities, we will review the measures necessary for the realization ofeffective cooperation among small-and-medium companies and small businesses including
business integration and reorganization. We will draw a conclusion by the end of this year.
• With respect to the credit guarantee system, based on the Small and Medium-sized EnterpriseCredit Insurance Act and the Credit Guarantee Association Act the systems of which were both144

amended this fiscal year, we will develop guidelines on realization of appropriate combinationof proper financing and guaranteed financing. Workability will be secured through monitoring
implemented by the Small and Medium Enterprise Agency and the Financial Services Agency
on the use of guarantee by each guarantee association and financial institution. Measures will
be taken starting this fiscal year to support promotion of efforts on managerial improvement ofbusinesses at an early stage, including control of cash-flow and profitability.
• We will enhance cooperation, both at national and community levels, among commerce andindustry associations, industry associations for small-and-medium enterprises such as chambersof commerce, strongholds for general support, organizations supporting managerial innovations,
SME Business Rehabilitation Support Co-operative, and Business Transfer Support Centers.
Best practices will be shared among them. We will establish action guidelines as well as
evaluation methods to improve performance of strongholds for general support, and introduce a
new system starting this fiscal year. We will improve problem-solving skills of commerce andindustry associations as well as chambers of commerce, which are the most familiar supportingorganizations, to provide effective support. The number of organizations supporting managerial
innovations based on the Act on Enhancement of Management of Small-and-Medium
Enterprises has increased to 26,000. We will realize and carry out by the end of this year
measures for the maintenance and improvement of quality with respect to the activities ofmanagement support, while “visualizing” the specific management support of each organizationfrom the perspective of businesses.
• Based on the analysis of factors for the success of startup support, we aim to strengthen
cooperation among supporting organizations and discover potential founders. With this aim, we
will consider future measures to take to support startups, with a view to reviewing the system ofcertification of business plans for the startup support. We will draw a conclusion by the end of
this fiscal year.
• Our goals are to vitalize local startups and improve business sustainability. For this purpose, wewill promote cooperation among government financial institutions such as Japan FinanceCorporation, local financial institutions, organizations that support small-and-medium
companies, and local governments. With the aim of vitalizing startup finance provided alongwith managerial support before and after the establishment on a continuous basis, we will
analyze, collect, and send out by the end of this fiscal year, best practices concerning the efforts
on startup support network as well as financing scheme implemented in cooperation with local
financial institutions.
• With a view to diffusing efforts on business continuation, the “System of Authentication of
Entities Contributing to the Strengthening of the Country” was established last fiscal year,
based on which companies that are making proactive efforts on the establishment of business
continuation plan (BCP) are authenticated by a third party. Our goal is to achieve 400
authentications based on this system by the end of next fiscal year. With this aim, we will
promote incentives for obtaining this authentication. Our actions for the promotion include, forexample, encouraging of financial institutions to use this authentication when they provide
financing related to BCP. This will be implemented through dissemination of know-how bookto small-and-medium companies and small businesses pertaining to the establishment of BCP,
as well as familiarization of and explanation to the financial institutions.

145iii) Expansion of investment on and improvement of productivity of local core companies andgrowing companies, cultivation of human resources, and enhancement of efforts to win
external demand• • We will take advantage of the Act on Promotion of Investment for the Future of Local
Communities, which has been amended this fiscal year. With respect to the businesses that lead
local economy by community-led local vitalization, we will adopt measures to focus on, which
include: subsidies for the promotion of local recreation, tax systems, promotion of supply ofrisk money using the Regional Economy Vitalization Corporation of Japan (REVIC) and
Organization for Small & Medium Enterprises and Regional Innovation, Japan, creation of newservices using data, making data open that brings solutions to local challenges, regulatory
exceptions, and establishment of strategies and development of market using professional
human resources. We will develop more measures including new measures for support. In order
to allow effective implementation, we need to identify local core companies which will be thecandidates of the businesses leading local economy. For this purpose, we will select and publish
about 2,000 companies by this summer, using a system that analyzes data on transactions in andoutside of the communities (RESAS). Furthermore, establishing a collaboration framework
among related ministries and agencies, for example, excavating projects in a collected effort
therefrom, aiming at providing support to about 2,000 companies in 3 years.
• We will continue to promote measures where local industries, public sector, academy, andfinancial institutions act in integration. We will solicit proposals of innovative measures basedon the perspective of local recreation. We will select those with best leadership and potential forhorizontal development, then promote a system whereby such proposals are integrally
supported by related ministries through subsidies for the promotion of local recreation,businesses that create circulation in local economy, and promotion of rural areas. This is how
we aim to create new local communities through implementation of near-future technologies.
• Our goal is to vitalize shopping malls. We will categorize features and functions expected of
local shopping malls and consider the ways of support according to the size and level. We willdraw a conclusion by the end of this year. With the aim of vitalizing central urban zones, wewill enhance coordination with the measures of local governments to develop urban areas.
• With respect to the core human resources for management and right-hand man, studying issues
faced by companies that dispatch and accept human resources, workers and the market with aview to utilizing human resources of large companies and other entities with abundant latest
knowledge, and reaching a certain level of conclusion by the end of this year regarding
necessary implementation policies including incentives and acceptance know-how.
• In order to address the labor shortage that small-and-medium companies and small businesses
are facing, we will provide support through diffusion of the “Guidelines for Small-and-Medium
Companies and Small Businesses to Address Labor Shortage” (established by the Small andMedium Companies Agency in March 2017), promotion of system of consultation at thestrongholds for general support, coordination with the prefectural labor bureaus, and promotionof use of employment-related subsidies. Also, creating model cases in the region to promotesecondary businesses/dual jobs that will lead the securing of diverse human resources and theestablishment of businesses. In order that the small-and-medium companies and small
businesses may put into practice the “Implementation Plan for Work Style Reforms” (adopted
by the Conference on Realization of Work Style Reforms in March 2017), including the actions

146

for the control of long working hours, we will implement necessary measures for support suchas familiarization and development of a system for consultation.
• We will support development of programs and curricula in graduate schools and universities on
hands-on management specialized in cultivation of management human resources for theservice industry. For this purpose, we will set up about thirty departments, faculties, andcourses by 2019. Moreover, through coordination with the world’s top institutions of higher
education, we will set up in Japan specialized international education programs in early 2020sin the field of food and tourism.。
• With respect to the SME University, we will consider enhancing its functions. This includes
expansion of training to improve access from local businesses as well as introduction ofadvanced hands-on programs. We will implement tests by the end of this fiscal year, and launchthem next fiscal year.
• We aim to vitalize local communities by creating new services and products responsive to theaging of society. For this purpose, we will establish a platform by the end of this fiscal year
where industries, public sector, academy, and financial institutions act in coordination to collectand analyze data as well as do demonstrations in model communities.
• We will consider more detailed assistance to the “New Big-Exporter Consortium”. In line with
this, in relation to the support on overseas development such as matching by JETRO in theservices field, we will develop new markets in Russia, Central/Eastern Europe, andCentral/South America, provide support in the fields of healthcare and nursing care in emerging
countries in Asia, as well as provide focused support in sports and IoT.
• With the aim of supporting overseas development of small-and-medium companies and small
businesses, we will provide support on development of market using e-commerce for overseas
as well as branding using foreign designers. We will draw a conclusion by the end of this fiscal
year.

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2. Development of Aggressive Agriculture, Forestry, and Fisheries(1)Main progress status of KPI《KPI》Increase the ratio of farmland used by business farmers to 80% in the next 10
years (by 2023) (48.7% at the end of FY 2013)=>At the end of FY 2016: 54.0%《KPI》Reduce the cost of rice production by business farmers by 40% in the next ten
years (by 2023) compared with the national average cost in 2011, including
through efforts by industry concerning farm inputs and distribution systems (riceproduced in 2011: 16,001 yen/60 kg)=>National average cost of rice production in 2015
• Individual farming* 11,397 yen/60 kg (reduction by 29%)
• Farming by incorporated organization** 11,996 yen/60 kg (reduction by 25%)
* Among certified farmers, individual farming management body (with rice-paddy
acreage of more than 15ha), whose farming income from rice paddy cultivation per
one farmer is equivalent to that from other industry.
** Organized farm management body (with rice-paddy acreage of 26ha on average)
whose sales income from rice paddy cultivation is largest compared to that from othertypes of farming《KPI》Increase the number of corporate farmers four-fold from the 2010 level to 50,000
in the next 10 years (by 2023). (12,511 corporations in 2010)=>2016: 20,800 corporations《KPI》Expand the market size of the so-called AFFrinnovation which means adding
value to agricultural products, forest products, and fishery products in an
innovative way, making new combinations, or creating a value chain,

to 10

trillion yen in FY 2020=>FY 2015: 5.5 trillion yen《KPI》Increase the export value of agricultural, forestry and fishery products and foods
to one trillion yen by 2019 (449.7 billion yen in 2012)=>2016: 750.2 billion yen(2) Specific measures to be newly taken
As the industry of agriculture, forestry, and fishery is community-based, we will increase its
productivity, maintain its status as a key industry and promote its development, thereby aiming
to increase the income of those who are involved.

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For this purpose, we will steadily put in place our efforts on reforms based on the “Japan
Revitalization Strategy” and “Enhancement Program on Competitiveness of Agriculture”(adopted by the Head Office for the Industry of Agriculture, Forestry, and Fishery, and Creationof Local Vitality on November 29, 2016). At the same time, we will address environmental
changes surrounding the industry of agriculture, forestry, and fishery, and further accelerate theenhancement of competitiveness of the industry. In this process, we aim to enhance our efforts
on incorporation of external human resources and knowledge, improvement of added values forthe entire value chain, and shifting to a data-based industry.
We will work on the following measures to realize these.
i)Strengthening of production sites① Enhancement of functions of the Farmland Bank
• In order to enhance functions of the Farmland Bank (the Public Corporation for Farmland
Consolidation to Core Farmers thorough Renting and Subleasing), we will promote the use of
hilly and mountainous areas as well as fruits production areas, enhance coordination withadministrative committee members

who specialized to

optimize farmland use, andstreamline administrative procedures pertaining to the farmland consolidation. We will also
follow up on these works.
• With respect to the land improvement business, we will focus on turning farmlands into large
compartments fit for general use or into dry fields. In response to the smoother coordination
realized between farm-field development business and the Institutions thanks to theamendment to the Land Improvement Act, we will promote development, accumulation, andintensification of farmland that is easy to use for those involved in agriculture.
② Reforms on rice policy• Through our steady implementation of reforms on rice policy, we will develop an environmentthat enable farmers to choose their crops based on their management decision.
• We will abolish the directly-paid subsidy for rice as well as the allocation of the riceproduction quota by the government from the rice produced in 2018.
• We will promote efforts in and outside of Japan on development of new demands for rice, suchas non-gluten rice powder.
• In the course of these reforms, we will review policies that would encourage further efforts andself-reliant managerial judgments while verifying the traditional policies.
• In terms of the improvement of productivity of rice for principal diet and feed, we will work in
an efficient manner on accumulation and intensification of farmland to those engaging in
agriculture, reduction of prices of production materials, and introduction of labor-saving

149

cultivation skills. We will also verify circumstances of cost reduction and improvement ofyield amount per unit, and achieve the KPIs through PDCA cycle without fail.
③ Development of environment for fostering and securing management units• We will follow up appropriately on the reforms related to the agricultural cooperatives andagricultural committees.
• In coordination with the local financial circles, we will promote incorporation of management,smooth succession of management, improvement of business management capability, andmatching of human resources with other industries.
• We will launch Agricultural Management Seminar which provides the opportunity to learn
business management in earnest while working on a farm, in around 20 prefectures in thisfiscal year. We will also proceed with the examination for measures to strengthen the humanresource capacity through utilization of foreign human resources, while taking into
consideration the progress of the examination on acceptance of foreign human resources.
• Through inspection and improvement of financing based on business potential evaluation by
Japan Finance Corporation and the like, we will promote financing that is independent fromsecurities and guarantors.
• With respect to the agricultural business, we will review the system of guarantee to allow thecredit guarantee system to be widely available upon financing from private financial
institutions.
• The Government will establish revenue insurance, which covers their whole agricultural
revenue and functions as their safety net, for farmers conducting business management
properly.
• With an aim to reduce prices of agricultural production materials and strengthen international
competitiveness of agricultural industry as well as industries related to agricultural production
materials, we will promote restructuring of industries related to agricultural production
materials. With respect to various legal systems and their operation pertaining to agricultural
production materials, we will rationalise and streamline them while harmonising them with
the international standards and ensuring safety of agricultural production materials.
• Our aim is to contribute to the further development and diversification of business farmers

byestablishing and operating various facilities and equipment that support agricultural
production. For this purpose, we will examine the treatment of greenhouse for agriculture
with regard to the Farmland Act. Further, we will consider measures for promotion offarming-type photovoltaic power generation that may contribute to the effective use of
farmland and increase of farmers’ income.
• We will consider measures to promote use of unclaimed quality farmland.

150• We will steadily promote Japanese agricultural direct payment system. In addition, we willencourage voluntary efforts to increase income in hilly and mountainous areas, taking
advantage of their features.
• With a view to promoting urban agriculture, we will establish a system concerning promotionof borrowing and lending of urban farmland.
④ Incorporation of external human resources and knowledge• In order to promote the the AFFrinnovation(adding value to agricultural products, forest
products, and fishery products in an innovative way, making new combinations, or creating avalue chain.) and collaboration between SMEs and agriculture/forestry/fishery businesses, wewill make use of economic organizations such as chambers of commerce and industry andchambers of commerce. We will promote nation-wide efforts on matching needs and seeds ofthose engaging in the industries of agriculture, forestry, fishery, as well as small-and-medium
companies. Such efforts include cultivation of human resources, designing and developmentof new products, and market development.
• In cooperation with the financial circles, we will develop and diffuse cutting-edge model
agriculture.
• Making use of the “Occasions for Accumulation and Use of Knowledge”, where specialists
from other fields as well as those engaging in agriculture, forestry, and fishery participate tocoordinate among industries, academy, and public sector, we will create hands-on
technologies.
• We aim to implement advanced technologies on site smoothly and speedily through cultivationand support of human resources who serve as a bridge for the cutting-edge technologies aswell as networking of research institutions.
ii) Improvement of added values for the entire value chain① Shift to agriculture based on diversified data
• By the end of this year, we will launch the “Agricultural Data Platform ”, where we can shareand use various data through coordination of different agricultural ICT systems,
standardization of data to be shared, opening up and providing of information such asmaps,weather, and agricultural data owned by public institutions.
• Our goal is to promote implementation of data-oriented agricultureusing the “Agricultural
Data Platform”. For this purpose, we will cooperate with private enterprises to expand casesof use and create new services. We will also encourage participation of a wide range ofentities, and aim to extend our efforts to the entire value chain from distribution to
consumption.

151• We will promote the use of artificial intelligence, IoT, big data, and robot technologies overthe entire value chain in various fields including fruits, greenhouse horticulture, and animaland dairy husbandry. For this purpose, we will promote research and development as well as
on-site demonstrations.
• In order to prevent leakage of data-based know-how of the industries of agriculture, forestry,
and fishery, we will consider measures for the protection of intellectual properties.
② Sophistication of value chain• With a view to implementing structural reforms in distribution and processing, we will promote
restructuring of businesses and industries including radical streamlining of intermediary
distribution, reviewing of standards for agricultural products, and reforms on production anddistribution of milk and dairy products.
• For the streamlining of logistics for the agricultural products, we will work on palletization,
joint transportation, and modal shift.
• We will radically review the Wholesale Market Act based on the changes in economic andsocial situations, and abolish any regulations that have no rational grounds any more.
• In coordination with businesses, consumers, and local governments, we will promotenation-wide movement on the reduction of food loss. Particularly, in order to reduce food loss
at the levels of retail and consumption, we will promote efforts on demand forecasting andstreamlining of logistics based on the coordination of food retailing industry and catering
industry with other categories of industry (such as IoT and weather).
③ Promotion of AFFrinnovation• Our aim is to smoothly address diversified on-site needs concerning the AFFrinnovation, suchas development of inbound products and facilities for export. For this purpose, we will
promote measures to support the AFFrinnovation in a comprehensive manner, including
intensification and reorganization of related measures.
• Taking advantage of the system of direct investment to the agricultural corporations weadopted this May, we will promote the use of the Agriculture, Forestry and Fisheries Fund forInnovation, Value-chain and Expansion Japan in coordination with the Japan FinanceCorporation.
④ Strategic promotion relating to standards, authentication, and intellectual properties• In order to make Japanese products more appealing, we will strategically establish and utilize
Japan Agricultural Standard (JAS), and standardize them internationally.
• We will promote the registration of geographical indication (GI). Moreove, by protecting GIs

152through ineternational agreements, we aim to protect brand values overseas of high quality
Japanese agricultural products overseas. In addition, we will also encourage the regional
efforts to creat brand products.
• Our goals are to increase export, and expand Japanese market, of Japanese products ofagriculture, forestry, and fishery, taking opportunity of Olympic and Paralympic Games Tokyo
2020. For this purpose, we will expand implementation of international-standard GAP (Good
Agricultural Practice) on production sites and obtaining of certification thereof, diffuse andspread sustainable agriculture such as organic agriculture, institutionalize food hygiene
control based on HACCP (a system whereby hazards relating to food manufacturing etc.are
analyzed and critical control points are monitored and recorded), and diffuse forest-certified
lumber. Further, with respect to the systems on certificationof Japanese GAP, food safety
management standards based on HACCP, and marine eco-labels, we will promote efforts ofprivate entities for their diffusion and international benchmark as well as providing humanresource development system which build capability of discussinginternational standards.
• We will promote development of breeding high quality plant varieties. Particularly, we
promote registration of Japanese high quality seed and seedings in overseas, and protect
international competitiveness of Japanese agricultural products.
⑤ Enhancement of the food labelling system• With the aim to contribute to consumers’ choice, we will advance the introduction of a newlabelling system that requires all processed foods to be labelled with the places of origin of theheaviest ingredient in the final products.
⑥ Promotion of use of wild game
• In order to prevent bird and animal damage, we will enhance harvest of harmful birds andanimals. With the aim of increasing local income through the effective use of harvested birds
and animals, we will develop demands for wild game while developing supply systems forsafe and secure wild game, including cultivation of human resources and introduction of rules
on distribution. At the same time, we will set up about twelve model districts across Japannext fiscal year where birds and animals are harvested, transported, and processed.
iii) Promotion of export• Based on the “Strategy to Strengthen Export Capabilities of the Agricultural, Forestry and
Fisheries Industries” (adopted by the Headquarters on Creating Dynamism through
Agriculture, Forestry, and Fisheries and Local Communities on May 19, 2016) and“Development Program on Export Infrastructure for Products of Agriculture, Forestry, and153

Fishery” (adopted by the Headquarters on Creating Dynamism through Agriculture, Forestry,
and Fisheries and Local Communities on November 29, 2016), we will steadily put in place
efforts on the promotion of export.
• Centered on the Japan Food Product Overseas Promotion Center (JFOODO), we will grasp
detailed demands, promote branding integrated with Japanese food culture, and provide sales
support aimed at establishing continuous commercial distribution. We will also promotemarket development for souvenirs together with our inbound tourist measures.

iv) Turning forestry into growth industry and appropriate management of forest• For the purpose of turning forestry into growth industry to increase income from forestry as
well as promoting appropriate management of forest resources, we will consider a newscheme that the management of forests can be consolidated by highly-motivated forestry
practitioners who manage forests sustainably, and the management of forests where the above
approach is not possible can be delegated to municipalities. We will finalize consideration of
the new scheme by the end of the year. The consideration of new scheme will take place alongwith the consideration on forest environment tax (provisional name), which has been listed in
the Outline of Amendment to the Tax System FY 2017 prepared by the ruling party as thefinancial resources for the maintenance of forest led by municipalities.
• In order to coordinate and consolidate forestry practices, we will promote a forest land
registerledger. In addition, using the geospatial information (G space information) and ICT
such as cloud as well as remote sensing technologies, we will promote grasping the conditionof resources and boundaries of forest estates.
• Taking advantage of ICT, information on supply and demand will be shared amonglogproducers, wood manufactures, and demanders, and we will promote supplying of wood
just in time.
• For the purpose of increasing demand for wood, we will reduce the cost of CLT (crosslaminated timber) by mass production and promote the use thereof to medium to highbuildings. We will also promote the thermal use of woody biomass for “local ecosystem”.
Moreover, we will work on the research and development of cellulose nanofiber and lignin
aimed at international standardization and commercialization.
v) Turning fishery into growing industry and development of resources management• Our goals are to control quantity and enhance management of fishery resources to increase
income from fishery as well as turning fishery into growing industry. We will review themeasures required to strongly promote these, including the consideration on related laws and154

regulations.
• For the purpose of improving the evaluation accuracy of resources, we will make use of ICT toset up a system to accumulate, analyze, and provide in integrated manner mass information
concerning resources, fish catch, and weather.
• Based on the circumstance of development of infrastructure for high-speed marine
communications, we will review effective diffusion of high-speed communications for fishingvessels.
• We will promote development and diffusion of ICT to realize fishery which is not dependent on
experience and hunch.
• Through a comprehensive review on transactions of fishery products and how logistics should
be as well as the use of ICT, we will establish a system whereby goods are delivered
effectively to demanders who find the highest value in them.

1553. Tourism, Sports, Culture, and Art(1)
Main progress status of KPI《KPI》 We aim to increase the number of international visitors to Japan to 40 million in2020 and 60 million in 2030.
=> 2016: 24.04 million (8.36 million in 2012)《KPI》 We aim to increase the amount of consumption by international visitors to Japan to
8 trillion yen in 2020 and 15 trillion yen in 2030.
=> 2016: 3 trillion and 747.6 billion yen (1 trillion and 84.6 billion yen in 2012)《KPI》 We aim to expand the market size for sports to 10 trillion yen by 2020 and 15
trillion yen by 2025 (5.5 trillion yen in 2015)=> 5.5 trillion yen (2015)《KPI》 We will establish twenty more stadia/arenas across Japan by 2025 as interaction
bases where diversified generations get together* A KPI newly adopted this fiscal year
《KPI》 We aim to expand the cultural GDP to 18 trillion yen by 2025 (about 3% of GDP)=> 2015: 8.8 trillion yen (8.7 trillion yen in 2014)(2) Specific measures to be newly taken
We need to create a virtuous cycle where local industries with high business potential as wellas quality employment and wages further attract investment and human resources to thecommunities. With this aim, we will support the growth of fields that take advantage of local
resources and appeals, including tourism, sports, culture, and art from which we can expect
ripple effects to the local economy.
Tourism is a trump card for “local recreation”, and it is the mainstay of growth strategy for theachievement of GDP in the amount of 600 trillion yen. For this reason, with the wide range of
economic ripple effect of tourism in mind, we aim to promote tourism with the double pillars of“inbound” and “tourism in Japan”. We will also disperse and increase Japanese and international
visitors concentrating on particular areas all over Japan.
In order to achieve this, we will work on realization of tourism-developed country based on
the “Tourist Visions that Support Japan of Tomorrow” (adopted by the Framework Conferenceon Tourist Visions that Support Japan of Tomorrow on March 30, 2016) and the “Basic Plan on
Promotion of Tourism-oriented Country” (adopted by the Cabinet on March 28, 2017) based
thereon, as well as “Program on Realization of Tourist Visions 2017 (Action Program 2017 for
the Realization of Tourist Visions)” (adopted by the Ministerial Conference on Promotion of
Tourism-oriented Country on May 30, 2017). In this course, we will organize the “Strategic
Conference on Promotion of Tourist Visions for District Blocs” in each district bloc, with thelocal branch offices and bureaus of relevant ministries added as members, to effectively promote

156the related measures on a cross-ministerial basis.
Vitalization of local communities centered on sports has proceeded from the framework phaseto embodiment phase. With the accelerating trend across Japan on reforms of stadia and arenas,
we aim to use attractive stadia and arenas that use private investment and knowledge as the coresof local communities to provide a spark for the local vitalization. For this purpose, we will adopt
various measures for support on a cross-governmental basis. As a legacy of the 2020 Tokyo
Olympic/Paralympic Games, we aim to expand the population of sports and turn the sports
industry to our key industry.
Our goals are to vitalize local communities and improve brand powers by using resources ofart and culture through cooperation of industries, academy, and public sector as well as to createsocial/economic values for culture with a focus on contents. For this purpose, we will enhance
the functions of the Agency for Cultural Affairs while expanding the economic scale of culture
and art industry (cultural GDP) and economic ripple effects of using resources of art and culture.
Accordingly, we will promote to develop into a “lucrative culture”, whereby culture and art,
tourism, and industries work together to create new values.
We will also adopt measures to spur spirits of consumption. The government and private
sector will work together to locally establish and the “premium Friday” through horizontal
development of successful cases. We will also change life styles by encouraging to obtainvacation thanks to the Work Style Reforms as well as providing products and services with highadded values.
In relation to the efforts across the communities involving local governments and local
enterprises, we will support businesses that lead local economy using all available policies andmeasures such as laws, budget, tax measures, and financial functions. We will also increase theappeals of local resources such as tourism, sports, art, and culture as well as increase the added
values and productivity of the service industry. Accordingly, we will expand the population thatis interactive beyond generations, and realize the communities where more people in Japan andfrom overseas visit repeatedly over a long period of time.
i）Tourism① Enhance the appeal of tourist resources to make them a basis of local recreation
A) Bold opening of attractive public facilities and infrastructures• The Guest Houses in Akasaka and Kyoto will be open to public throughout the year. We will
also promote efforts to increase appeals such as opening them during night time depending on
seasons. Opening on special occasions will also be considered. In order to build facilities that
may invite tourism in the park in front of the Guest House in Akasaka, such as cafes, we will
launch designing during this fiscal year.
• There will be more guided tours with larger number of visitors per day at Katsura Imperial Villa,
and guided tour in English will be newly implemented exclusively for international visitors.
• Based on the opinions of intellectuals, we will continue to review the measures to address theincrease in the cost of maintenance and management that will accompany the expanded scopeof opening of public facilities as well as the charging of fees to further improve the level ofservices.
B) Blossoming of cultural properties as tourist resources157

• We will implement overall development of integrated cultural properties of local communities(not of a single cultural property) as well as provide illustrations in multiple languages using
professional native human resources through about one thousand businesses. About two
hundred tourist bases will be established which focus on cultural properties including Japaneseheritages. We will focus our support on 4 areas, which will be the models for creating tourist
bases through their good efforts. Moreover, we will use VR technologies, accumulate
know-how for the preservation and use of national treasures through promotion of locally-held
exhibitions, and improve procedures such as bidding for the repairing of cultural properties.
C) Branding of national parks as the “National Parks”• With respect to the 8 national parks selected under the “Project for Promoting Full Enjoyment of
National Parks”, we will make maximum use of the knowledge and funds of the private sector
through public offers or the like. We will work on attracting quality hotels, expanding activities,
cultivating skilled guides, setting up private tour offices in visitor centers, creating universal
design for sceneries, establishing facilities friendly for international visitors, introduction ofsystems whereby users bear the costs of maintenance and management of facilities as well as
nature preservation. Further, we will send out information overseas and develop indices focusedon “quality” such as the amount of consumption. The cases and know-how of the 8 nationalparks will be horizontally developed by providing the information to other parks.
D) Increase the appeals of tourist sites by preserving and using tourist asset with superior
sceneries• We will promote establishment of plans on sceneries of major tourist sites across Japan by 2020.
We will also focus our support on 10 “Model Districts for Development of Towns based on
Renovated Sceneries”.
• We will promote undergrounding of electric cables based on the Act on Promotion of
Disappearance of Utility Poles and the Act on Maintenance and Improvement of Traditional
Scenery in Certain Districts, using PFI methods as well.
E) Establishment and creation of rural areas for stay
• We will provide support for the establishment of systems for rural-tourism, development ofexperience programs for agriculture, forestry, and fishery, and renovation of Japanesetraditional houses. We will create 500 areas by 2020 where they are equipped with systems thatprovide, as a business, trips to rural areas for accommodation. Further, we will work on the
projects including “Savor Japan” and “Japanese Nationally Important Agricultural Heritage
Systems (J-NIAHS)”.
F) Promotion of development of tourist towns using historical resources including Japanesetraditional houses• Efforts will be made on renovation into quality accommodation facilities of historical resourcesin the communities including Japanese traditional houses, and regenerate and use them all as
the core of development of tourist towns. The development will be made by 2020 in two
hundred areas across Japan, with a focus on preservation districts of important historicbuildings and rural areas.
G) Development of new tourist resources• With a view to establishing a new brand called “A Delightful Country—Japan”, we will promotenight entertainments, develop new contents for international visitors including traditional
entertainments, multilingualize dramas and sports events, set spots for international visitors,

158

and develop systems for receiving night openings. We will set up a public-private session toenhance transmission of information using the SNS of these contents. In addition, with respect
to the national museums, we will promote increasing of educational programs where we canparticipate and experience, multiligualization, and extension of opening hours.
H) Development of tourist demands in local shopping malls and increasing of consumption of
traditional crafts• In order to expand by 2020 the production areas of traditional crafts which can receive
international visitors to over a hundred, we will invite foreign intellectuals to the production
areas of traditional crafts.
I) Improvement of wide-area tour routes to reach the global standards• With respect to the wide-area tour route formation plans for 11 regional areas of Japan, we will
enhance contents for visitors who stay, with a focus on model courses for each. We will
discover the appeals and challenges of communities and make proposals for measures to take,while providing support for the improvement of abilities of related people in the regions.
• We will network the regions that are working on theme-based tourism such as roads, shrines andtemples, sake breweries, Japanese traditional houses, animations, and bicycle riding to enhancetransmission of information and attract visitors to the local communities.
J) Promotion of formation of “Tourism Nation Showcase ”• We will promote private investment to Kushiro City, Kanazawa City, and Nagasaki City on their“Tourism Nation Showcase Implementation P lans” by setting up opportunities for the matching
between the 3 cities and private businesses. Relevant ministries and agencies will cooperate toprovide prioritized support, and will speedily work on necessary regulatory reforms.
K) Reconstruction of tourism in Tohoku• With the aim of increasing the number of international visitors taking up lodgings in the 6
Tohoku prefectures to 1.5 million in 2020 (triple the number of 2015), we will brush up tourist
resources, develop environment for receiving visitors, promote the formation of wide-area tour
routes , regenerate and vitalize ryokan (Japanese-style hotels), and advertise through destination
campaigns. In addition, we will provide focused support to Sendai City and the peripheral areas
including Sendai Airport (“Urban Areas to be Reconstructed to become Tourist Bases”), as wellas implement advertisement in Japan and business of regeneration of educational travel for
Fukushima Prefecture.
② Innovate tourist industry and enhance its international competitiveness to make itinto the key industry of JapanA) Comprehensive review of regulations and systems related to tourism• Through the revision of the Licensed Guide Interpreters Act and the Travel Agency Act, we will
enable paid guiding acts across Japan by persons other than the license guide interpreters, aswell as maintain and improve the quality of license guide interpreters. With the introduction ofregistration system for land operators, we will make their services more appropriate. At thesame time, we will develop a system whereby community-based businesses are able to design
and provide community-based optional tours..
• We will improve productivity by using ICT and through coordination among accommodation
facilities. In addition, we will also promote change in business models of lodging industry.

159B) Measures for services of renting private homes• Based on the Act on Home Lodging Business, we will set up systems of notification concerning
those operating a business of home lodging as well as registration concerning those operating
businesses of home lodging management and home lodging brokerage to secure appropriate
home lodging services.
C) Cultivation and enhancement of managerial level human resources based on the needs of
tourism industries• Our goal is to establish, starting in next fiscal year, permanent education bases of managerial
level human resources in the graduate school level (including MBA) of Hitotsubashi University
and the University of Kyoto. For this purpose, we will develop hands-on and professional
education programs. Further, we will promote establishment of curriculum policies to transform
curricula of tourism faculties of existing universities. Through the revision of the Act on
Partial Amendment to the School Education Act, we will establish universities for specialists
that engage in hands-on vocational education.
D) Immediate elimination of shortage in accommodation facilities and provision ofaccommodation facilities meeting diversified needs• Our goal is to provide accommodation facilities across Japan (including local communities) thatmeet diversified needs, including those that provide lodging experiences unique to Japan aswell as quality services. For this purpose, we will promote investment to accommodation
facilities through public-private funds, as well as investment/financing and know-how support
integrated with the town development provided by related organizations.
E) Formation and cultivation of world class DMOs
• In order to form 100 world class DMOs nationwide by 2020, we will provide comprehensive
support using one-stop consultation for candidate corporations of Japanese DMOs, enhancing
functions of the “DMO Net”, and using “subsidy for promotion of local recreation”.
• Starting next January, we will implement a full-fledged statistics survey concerning the numberof visitors and amount of travel consumption per prefecture.
F) Continuous development of “Funds for Recreation and Vitalization of Tourist Sites”• We will establish a system whereby we can stably and continuously provide in and after next
fiscal year and on the functions of Regional Economy Vitalization Corporation of Japan(REVIC) concerning investment know-how and human resources support pertaining to thetown development for tourism.
G) Consider funding sources to implement the next phase of development of the tourism sector• We are in a situation where recent expanding inbound tourism has been affecting our economy,society, and people’s life, and tourism is becoming the mainstay of economic growth strategy
and regional revitalization strategy. Based on this situation, we will review measures to secure
funding sources for the nation which will be necessary to implement tourism policy measures at
a high level in response to the tourism demand which will grow further in the future.
• Seek to secure additional funding sources by sharing the burden with the beneficiaries of a
growing tourism sector, taking into account the experience of other advanced tourism countries.
H) Strategic enhancement of promotion on visits to Japan, and better dissemination of wide
variety of tourism attractions of Japan• In order to bring more international visitors who are not interested in visiting Japan, including
high-end tourists and consumers in Europe, North America and Australia, we will execute

160

localized tourism marketing and promotion based on strategies unique to each target country
collaborating with Japanese diplomatic establishments abroad and private sectors. In parallel,
we will strengthen JNTO's capacity to identify consumer needs in each target country using
digital marketing, by incorporating suggestions by advisory board consisting of foreign
intellectuals, and by employing marketing and ICT professionals. We will completely renovate
JNTO global website using feedbacks from foreign experts and will promote SNS marketing aswell as utilization of influential bloggers overseas. We will help local communities improvetheir promotion skills by establishing new department in JNTO that support local governments
and destination marketing organizations (DMOs) by providing cooperation and consulting
services.In the course of implementation of promotion, we will make sure to control
deliverables and reflect them to measures.
• Through the promotion of “Host Town”, we will enhance transmission of information overseas.
I) Promotion to attract MICE
• At the “Liaison Meeting for Promotion of MICE by Related Ministries”, we will compile
cross-governmental measures for support as action plans by the end of this fiscal year. We willraise the level of attraction and organizing power for MICE to the world level with a focus on“Global MICE Cities”, and also provide support to promote holding of conferences at uniquevenues.
J) Strategic relaxing of visa
• From among twenty countries and regions focused for the business of promotion of visits toJapan, there are 5 countries visits to Japan from which require a visa (China, the Philippines,
Viet Nam, India, and Russia). The government will work as a whole to relax visa in a proactive
manner in conjunction with the improvement of awareness through promotion as well as thedevelopment of environment for receiving visitors.
③ Realize an environment where all travelers can enjoy sightseeing comfortably andfree from stressA) Realization of innovative immigration control using cutting-edge technologies• With an aim to keeping the waiting time for the immigration control at the airport under twenty
minutes, we will review the increasing of airports that introduce BioCart, early realization ofpre-clearance, introduction of face authentication technology, and expanded use of automatic
gates for embarkation procedure by international visitors. We will also prepare for the
introduction of a system to publish time required for the disembarkation procedures at Narita
and Kansai Airports.
• We will introduce body scanners into major airports across Japan by 2019, and introduce otheradvanced equipment for security check by 2020.
B) Radical improvement of cashless environment (including promotion of installation of ATMs
responsive to cards issued overseas)• Our goal is to install by 2020 ATMs responsive to cards issued overseas by 3 mega banks inabout half of all bases where ATMs are installed (approximately 3,000 in total). We willencourage the 3 mega banks to make steady efforts to set up most of them by the end of nextyear.
• By 2020, we aim to realize “100% acceptance of credit card payment” and “100%161IC-correspondent payment terminal” in major commercial facilities, accommodation facilities,
and tourist sites visited by international visitors. We will encourage installation of terminals forpayment.
C) Radical improvement of communications environment as well as realization of environment
where everyone can walk alone safely• By the end of FY 2019, we will promote development of Wi-Fi environment in approximately
thirty thousand bases for disaster prevention. We will also establish a system of coordination ofauthentication for over two hundred thousand places including existing Wi-Fi access points. We
also aim to eliminate by 2020 sections where we cannot use mobile phones in the tunnels of
Shinkansen.
• Based on the “Global Communications Plan” (published by the Ministry of Internal Affairs andCommunications on April 11, 2014), we will research and develop a multilingual speechtranslation system and implement demonstration and experiment for its diffusion andexpansion.
• With an aim of increasing information centers for international visitors certified by JNTO toaround one thousand by the end of this fiscal year, we will promote establishment of
information centers such as in accommodation facilities. We will also develop guidance
facilities to provide detail information and learning opportunities at tourist sites, as well as
westernize public toilets near tourist sites.
• In order to attract visitors from Muslim travel market, we will establish a cross-ministerial action
plan by the end of this fiscal year.
• Through the efforts based on the Act on Promotion of Use of Bicycle, we will create a safe andcomfortable environment for the cyclists in and outside of Japan.
D) Improvement of a system of acceptance of international patients fully responsive toemergency cases• We will accelerate our target of establishing one hundred “medical institutions with developed
system of acceptance of international patients” (that also have reception services forinternational visitors) by 2020 through our support of assigning medical interpreters, and aim toachieve this by the end of this fiscal year. We will further improve “medical institutions that
accept international visitors to Japan” (approximately 900) that are able to examine in foreign
languages.
E) Full equipment of “Local Recreation Corridor” using high-speed transportation network• We will improve further awareness of the “Japan Rail Pass” that we have been able to purchasein Japan since March this year, and develop an environment where it is easy for international
visitors to buy it. We also aim to improve convenience of access to tourist sites through creationof universal tickets for transportation and sending of information related thereto.
• We will improve “numbering of highways" and descriptions of road signs, to be mostly
completed by 2020. Highway companies will cooperate with the national and local
governments and rental car businesses to develop designed discounts for the use of local
highways including a driving pass for excursion.
• We will make use of the “paid tourist passenger transportation business for personal use”, which
is an exceptional measure adopted by the Road Transportation Act based on Article 16-2 of the
Act on Special Districts for National Strategy.
F) Enhancement of gateway functions of local airports162• We will provide support to the “airports that support attraction of visitors to Japan” bydiscounting/subsidizing landing fee and supporting the development of CIQ facilities. We will
also promote new flight services and increase the number of flights as well as sophisticate theaccepting environment of flight passengers. In addition, in order to realize integral operation ofmultiple airports in Hokkaido (such as concession), we will implement market sounding by theend of this year.
• We will increase the processing capacity of Haneda and Narita Airports to forty thousand
landing and takeoff each by 2020. At the Haneda Airport, they will develop facilities necessary
for reviewing the flight routes, promote environmental measures, provide careful information,and expand terminal buildings in cooperation with the private sector. The capacity of landing
and takeoff to be increased will focus on routes that are important to strategically promoteachievement of targets of number of international visitors to Japan as well as routes with highdemand for direct flight from Japan in terms of enhancement of international competitiveness.
We will prepare for the discussion with related countries. At the Narita Airport, they will take
into account the requests from local governments and consider on a speedy basis, together withrelated organizations, the development of the third runway and relaxing of restriction onnight-time flights to further enhance functions.
• We will establish more spots available for parking of airplanes at the Haneda Airport, discuss
among related parties for the Narita Airport, and aim to improve accepting environment ofbusiness jet planes in the metropolitan area.
• We will enhance functions of local hub airports by developing passengers terminals exclusive
for LCC at the Chubu Airport, expansion of aprons at the New Chitose Airport and New
Ishigaki Airport, establishment of new taxiways, and development of CIQ facilities.
• In order to make Narita and Haneda Airports the gateways to Japan that we can be proud of to
the world, we will use liaison meetings with related parties to work on the improvement ofaccess to and from the airports by railway and bus, as well as develop bases for thetransmission of information using airports as gateways.
G) Further expansion of accepting of cruise ship
• We will promote development of mooring posts, fenders, and landing bridges, as well as support
installation of mobile boarding bridges. We will realize “zero rejection” of port calls of cruise
ships through provision of “matching” services by cruise ship companies and ports.
• We will promote use of a system of loan with no interest for the development of passenger
terminal buildings by the private sector. We will amend a part of the Ports and Harbors Act tocreate bases for the international cruise by public-private coordination. This will be done
through the establishment of an agreement that allows prioritized use of piers by cruise
companies that invest in passenger terminal buildings.
H) Innovation of an environment for the use of public transportation• Our goal is to enable online reservation in foreign languages for all Shinkansens. For thispurpose, we will adjust with related railway businesses for the launch by this summer by
Tokaido Sanyo Shinkansen and the early introduction by Kyushu Shinkansen. We will also
promote establishment of Hands-Free Travel services at major transportation hubs. Furthermore,
we will introduce barrier-free transportation, develop free public wireless LAN environment,
and increase signs in multiple languages in railway stations, bus terminals, and passenger ship
terminals.

163I) Reforms on vacation time
• In order to secure time for adults and children to give attention to each other, we will newly set“kids week” for each region starting next fiscal year. Measures will be considered to take into
account local circumstances and prevent confusion at educational scenes. We will spreaddays-off for schools by moving a part of the long vacation (such as school summer holidays) toweek days during the terms. We will promote taking of paid vacation on the school days-off
that have been spread, and secure various opportunities for activities on days-off. All of thesewill be promoted integrally by the government and the private sector.
J) Promotion of universal designs for the Olympics and Paralympics• We will steadily promote the measures based on the “2020 Action Plan for the Universal
Designs”(adopted by the Meeting of related Ministries on Universal Designs 2020 on February 20, 2017). We
will also review related systems including the Barrier-free Act. We will promote introduction of
barrier-free cars for buses and taxis, make major railway stations and areas around tourist sites
barrier-free, and make roads that connect competition venues and nearby stations entirely andcontinuously barrier-free.
ii) Development of future for sports industry① Vitalization of local communities focused on sports (implementation of the “Future
Development Plan for Sports”)• We will work on the reforms where stadia and arenas, that will be the trigger for the vitalizationof economy focused on sports, will be the bases for the festivity and creation of communities
such as musical events and health development in addition to sports. More particularly, with aview to making stadia and arenas profit centers, we will establish plans for facility development
and provide support aimed at public-private coordination. This will be done throughdispatching of specialists in response to local needs, use of PPP/PFI including concession
method aimed at effective development/operation of facilities, use of advanced technologies forimages and delivery such as high-speed wireless LAN and 4K/8K aimed at improvement offacilities’ customer-attracting functions and convenience, use of the system under the Urban
Park Act amended this year, promotion of introduction of private vitality through naming rights,
and intensified support for businesses involving overall communities that lead local economy
through the use of the Act on Promotion of Investment on the Future of Local Communities.
• With the aim of improving the rate for the children’s implementation of sports and through the
improvement of quality of club activities instructions as well as creation of new businesses for
sports instruction, we will work on the efforts aimed at cooperation between schools featuring
the local communities and local sports organizations and enterprises, taking opportunity of theinstitutionalization of “club activities instructors”.
• The government as a whole will launch these efforts aimed at local vitalization focused on sports
this year, and call this the “Development Plan for the Future of Sports”.
② Enhancement of management ability of sports contents holders, promotion of
establishment of new businesses• Our goal is to develop infrastructures aimed at enhancement of managerial human resources for164the sports-related organizations. For this purpose and with a view to establishing academic
degree (sports MBA), we will promote our review in cooperation with sports organizations,
universities, and research institutions to establish educational organizations focused on
cultivation, matching, and research and development.
• With respect to the sports in universities, we aim to establish by the end of FY 2018 an
across-the-university and across-the-competition controlling organization (Japanese NCAA)
that aim to establish appropriate organizational operation/management and sound university
sports business. For this purpose, we will establish an industries/academy/government
coordination council and promote designing of systems. With respect to the establishment of
departments as well as allocation of human resources that control and manage in a strategic andintegrated manner the efforts on improvement of career creation in the field of sports inuniversities, local contribution, and fund-procurement ability, we will encourage one hundred
universities to make the effort in the next 5 years.
• With respect to the researches on AI/IoT and big data in the field of sports as well as use of vitaldata, in order to promote demonstrations on the scenes of sports and commercialization, we will
make a review aimed at the establishment of “Sports Open Innovation P latform (provisionalname)” through coordination of sports organizations, enterprises, related ministries andagencies, and universities.
• We will establish and implement by the end of this year strategies for the promotion ofvitalization and sustainment of “sports tourism” through public-private cooperation. We will
also support efforts of “Local Sports Commission” made through coordination of local
governments, sports organizations, and tourist industry, and promote further cooperation andintegration in the fields of sports, culture and art, and tourism.
• With respect to the development of environment that allows athletes to concentrate on games
and establishment of careers after their retirement, we will review in coordination with sports
organizations and enterprises to make efforts appropriate for each athlete. We will also consider
measures to support athletes’ careers that bridge between their active time and time after
retirement. This includes dual career, re-learning, and expansion of opportunities to work at
schools and communities.
③ Promotion of overseas development of sports• In terms of overseas development of added values such as educational effect of sports contents
unique to Japan (physical education, club activities, sports day, and town dojos) incorrespondence with each community, with a view to coupling with international exchanges,
we will review public-private strategies for the international cooperation on sports.
• Taking advantage of the fact that live broadcasting of sports has strength as contents, we aim to
expand broadcasting rights business in the overseas areas. For this purpose, we will review
strategic efforts including inbound promotion relating to sports leagues in Japan.
④ Improvement of rate of implementation of sports• With respect to the improvement of rate of women playing sports, we will review the “WomenSports Campaign”, through which we send out messages to the nationals and a wide range ofrelated people. We will draw a conclusion by around the end of this fiscal year.

165• We will work with sports-related organizations with respect to the policies on targets andmeasures concerning the share of women executives and employees in sports-relatedorganizations. We will draw a conclusion by around the end of this fiscal year.
• With the aim of improving the implementation rate of sports by disabled people, we will
coordinate with sports-related organizations and financial circles to promote organization ofsports events across Japan where disabled children can participate. We will also provide support
to use all special-needs schools as local bases of sports by disabled people.
iii) Vitalization of economy using cultural and art resources① Development of systems to further promote the use of culture and art resources• Our goal is to create social and economic values through inheriting, developing and creating
cultural stock that we are proud of. For this purpose, we need to expand the economic size
(cultural GDP) of culture and art industry as well as economic ripple effect based on the use ofculture and art resources. We will thus establish by the end of this year the “Strategy on Culture
and Economy (provisional name)” through coordination of related ministries and agencies.
• In order to create new demand using culture and art resources and create innovation, we will
improve quality of curators, cultivate advanced producers, and strategically cultivate and secure
various human resources.
• In order to promote further opening and use of cultural properties, we will respond to theconsultations from local governments and museums to the owners/managers of culturalproperties in an integrate manner, as well as develop functions of centers that send out
information concerning opening and use of cultural properties. In addition, we will review thesystem of protection of cultural properties based on the perspective of sustainable use. We will
repair, develop, fine dress cultural properties at appropriate intervals as well as prevent themfrom disasters and theft. We will also diffuse best practices concerning unique venues andmultilingual interpretations, as well as review promotion of openings using technologies suchas VR and “clone cultural properties” (replication of cultural properties with high precision).
② Vitalization of communities focused on culture and art resources and improvement ofbrand power• Taking “Ueno Cultural Park” as a model, related ministries and agencies will cooperate toprovide focused support on the overall and integrated development of local cultural resources
for the creation of a cultural cluster (district where culture accumulates). We will work on
coordination and enhancement of advice, review, and evaluation (arts council functions) by
specialists on the measures of support of the national and local governments for culture and art,
as well as improvement of brand power of Japanese heritages. We will also establish guidelines
by the end of this fiscal year to encourage management reforms aimed at promotion ofmultilingualization and night-time opening of cultural facilities.
• In order to promote innovation, we will support establishment of a platform by high-level
educational institutions, such as universities, working on education on advanced designs, andreview model educational curricula. We also aim for cross-industry/academy coordination that
include local universities, and aim to cultivate human resources for advanced designs. We will
also review ways to protect and use designs that contribute to the brand power of enterprises.

166• By expanding authenticated organizations under the “beyond2020 Program”, we will develop
across Japan the “Cultural Program” that sends out the appeals of Japanese culture inward andoutward, and realize establishment of local vitalization and inclusive society. Further, throughthe participation of cultural figures active overseas in the front lines as well as the use of
diplomatic establishment overseas and Japan House, we will enhance strategic transmission ofJapanese culture in and outside of Japan, and aim to establish Japan brand based on culture.
• We will promote development of systems that promote implementation of festivals forinternational cultural exchanges. In addition, by 2020, we will enhance transmission by“ambassadors of cultural exchange” who will be dispatched overseas, and strongly promoteinteractive cultural exchanges including inviting of foreign artists and famous foreign people.
With a view to expanding the disabled people’s opportunities for culture and art activities, wewill promote efforts to provide explanations concerning culture and art works, enhance creative
activities, develop environment for the use of facilities, and commercialize excellent art works
and give back profits therefrom to creators and/or facilities.
③ Enhancement of culture and art industry with a focus on contents• With a view to developing new market for regional contents, we will expand government-private
dialogues with each country aimed at developing contents markets in Asia that have been
rapidly expanding. We will also organize events for business matching in and outside of Japan,
as well as develop guidelines together with industry associations for the use of advanced
contents technologies such as VR/AR.
• We will promote contents industry and tourism, as well as enhance functions of transmitting themedia art field in and outside of Japan, including films, manga, animations, and games that leadto local recreation.
• In order to integrate the intellectual resources and culture and art resources of Japan and create
new businesses and services, we will promote digital archiving in each field as well as
establishment of an across-the-field integrated portal centered on the National Diet Library.

167

IV Taking in Overseas Growing Markets(1) Main progress status of KPI《 KPI》Aim to raise FTA ratio to 70% (2012: 18.9%) by 2018=> As of the end of FY 2016: 40.0%* The share of trade value in total Japanese trade value with countries with which
EPA/FTA has entered into force or signed as of the end of FY 2016 (based on 2016
trade value)* Negotiations on 6 EPAs are under way with a view to an early conclusion(If the shareincludes those 6 EPAs, it would be 85%)
《KPI》Double the inward foreign direct investment (FDI) stocks to ¥35 trillion by 2020(as of the end of 2012: ¥ 19.2 trillion)=> As of the end of 2016: ¥27.8 trillion《 KPI》Double the value of export by SMEs by 2020 compared with the level of 2010=> FY 2014: ¥14.9 trillion (FY 2010: ¥12.6 trillion)《KPI》Raise overseas infrastructure project orders received to approximately ¥30 trillion
by 2020 (2010: approximately ¥10 trillion)=> 2015: approximately ¥20 trillion* KPI figures include “income from business investments on overseas infrastructure, etc”.
《 KPI》Raise overseas sales of broadcast contents to ¥50 billion by 2020=> FY 2015: ¥28.85 billion* The previous KPI (“Triple overseas sales of broadcast contents by FY 2018 from the
FY 2010 level”) has been achieved by the performance in FY 2015.

(FY 2010: ¥6.63

billion, target: approximately ¥20 billion)(2) Specific measures to be newly taken
The Government will promote overseas expansion of Japanese companies’ vitality, and will
seize overseas growing markets that continue to expand primarily in emerging countries, toexpand virtuous cycle by incorporating benefits therefrom into regions of Japan.
In order to achieve this target, the Government will promote overseas business expansion
utilizing advanced technologies of the Society 5.0 era including IoT, where Japanese companies
possess competitive advantage, in order to support Japanese companies including SMEs whichhave not been able to begin overseas business expansion although they have those technologies.
In addition, in conducting such initiatives as promoting inward foreign direct investment or CoolJapan, the Government will take measures to increase attraction of Japan.
Specifically, the Government will consider and promote each of the following: i) as part of the“measures to support overseas expansion of Japanese companies”, expansion of infrastructure
exports, establishment of international rules on trade and investment, establishment of common
international understanding and development of rules that contribute to promote use of data,
support for SMEs, and initiatives to actively accept to utilize highly-skilled foreign professionals
in the cutting-edge fields, and ii) as part of the “measures to utilize attraction of Japan”,

168enhancement of initiatives to promote inward foreign direct investment, promotion of Coo lJapan, development and promotion of clean and attractive “Japanese IR” (Integrated Resort),
invitation of 2025 World Exposition, and taking in growing markets through collaboration with
communities of Japanese immigrants and descendants (“Nikkei”) overseas.
i)

Supporting overseas business expansion of Japanese companies① Expansion of infrastructure exports• In order to realize economic growth by exporting infrastructure and enhance competitiveness ofJapanese companies, aiming to export infrastructures that keep winning over the future todifferentiate from other competing countries, the Government and the private sector will jointly
promote priority measures on the “Infrastructure Export Strategy (Revised Edition FY2017)” (approved by the Ministerial Meeting on Strategy relatingInfrastructure Exports andEconomic Cooperation on May 29, 2017), with sufficient consideration on safety measures
including against terrorism. The Government will also pay attention to the enhancement ofregional connectivity under the “Free and Open Indo-Pacific Strategy”.
• In the key industries and important fields such as electricity, railways, and information andcommunications, while keeping in mind the utilization of advanced ICT including IoT and AI,
the Government will establish strategies for overseas business expansion, which indicate thedirection for the Japanese infrastructure exporting industries to take in order to enhance theircompetitiveness over the future.
• With a view to developing the infrastructure exports based on these strategies, the Government
will promote sales pitches, further utilize supportive policy tools, and make the following
initiatives:- While disseminating the concept of “quality infrastructure investment” globally, in orderthat the “quality” of infrastructures is appropriately evaluated, the Government willcontinuously support improvement and enhancement of partner countries’ bidding systems.
In the course of doing this, the Government will promote understanding and sharing
information concerning the necessity of appropriate maintenance and replacement.
- In order to expand opportunities for Japanese companies to win orders, the Government willtake measures such as promoting “overall development” (creation and improvement of
cities, regional development, development of corridors and hubs), establishingdevelopment plans that are the “most upstream phase” and reviewing existing plans,
providing assistance to implove legal systems, and promoting human resource
development, as well as working on enhancement of abilities to make proposal andimplement PPP projects preferred by emerging countries.
- In addition, the Government will promote establishment of systems that enhance further
infrastructure exports including the following: a) enhancement of public and private
consulting functions such as consultation points on infrastructure projects and supportingof legal aspects, b) promotion of measures targeting third party countries in cooperation
with other countries, aimed at further enhancement of competitiveness of Japanesecompanies upon entering into new markets, and c) consideration of institutional measuresthat enable more full-fledged implementation by public institutions and companies fromproject creation to operation, maintenance, and management after the completion of169

construction in the fields of railway, airport, cities/home, and sewerage.
② Promoting Economic partnership negotiations, and conclusion/amendment ofinvestment-related agreements and tax treaties• In order to expand free and fair markets in Asia-Pacific region and across the world, theGovernment will push forward to achieve entry into force of the TPP Agreement which Japan
has concluded, and continue discussions on expansion of its member countries/regions. The
Government will also promote negotiations on other economic partnerships strategically and
expeditiously, including Japan-EU EPA, RCEP, and Japan-China-Republic of Korea FTA.
Playing central roles in building such wide-area new economic order, Japan, as thestandard-bearer of free trade, aim to take the lead in establishing comprehensive, balanced, andhigh-level global rules. The Government will implement cooperation with ASEAN to realize
inclusive and innovative growth in Asian regions, and high-quality RCEP.
• Based on the “Action Plan for improvement of investment climate through promoting theconclusion of investment-related agreements” (announced in May 2016), the Government will
work on negotiatioins aiming to sign and/or achieve entry into force of investment-relatedagreements (investment agreements and economic partnership agreements with investment
chapters) covering 100 countries/regions by 2020, while strengthening organization. Expecting
to cover eighty-two countries/regions in total, including those that are currently undernegotiation, the Government will aim to launch new negotiations with thirteen other countries
by the end of this year through consultation with them.
• Regarding the tax treaties, the Government will expand networks for tax treaties in terms of
quality and quantity that is necessary for supporting sound overseas business expansion ofJapanese companies, through concluding new treaties with countries/regioins where investment
relations with Japan are expected to develop, as well as amending existing treaties.
③ Establishing common international understanding and rules concerning distribution
and use of data
• In order to maximize the potential power for growth with technical innovations including IoT
and big data, the Government will make efforts to establish international rules that include
promotion of free distribution of information as well as prohibition of data-protectionistic
policies such as requirement of data localization (request for installing servers), and access to ortransfer of source code, except where there are justifiable public policy purposes such as
ensuring cyber security.
• The Government will establish common understanding and promote cooperation throughinternational forums such as G20, G7, OECD, APEC, and WTO as well as EPA/FTA.
• Through WTO and negotiations on economic partnership, the Government will take the lead inestablishing rules on digital trade.
.
④ Supporting overseas business expansion of SMEs
• The Government will consider more detailed assistance by the “Consortium for New Export
Nation”.
• Regarding JETRO’s support such as business matching for overseas business expansion of170

service industries, the Government will a) cultivate new markets such as Russia,
Central/Eastern Europe, and Central/South America, b) provide support in the fields ofhealthcare and nursing care in emerging countries in Asia, as well as c) add sports and IoTamong focused areas for support.
• The Government will further consider and promote the following measures to support SMEs.
- Safety measures (While further expanding the “SMEs Overseas Safety Measures Network”,
The Government will strengthen disseminating and sharing information through distributing
and upgrading manuals on safety measures and providing seminars about them, trainings, andimplementing drills. The Government will also support measures against terrorism indeveloping countries through ODA.)- Troubleshooting in overseas (consultation services including in legal/labor/tax affairs forJapanese companies provided by overseas diplomatic missions, JETRO, and experts including
legal professionals, as well as research and study)- Facilitate travelling of business person (fast issuance of APEC business travel cards in
response to the increased applications due to expansion of its issueing targets to SMEs)⑤ Utilization of highly-skilled foreign professionals• In order for the further attraction of highly-skilled foreign professionals, the Government will
actively publicize information that the living and working environment of foreigners has been
improving, and the immigration system for highly-skilled foreign professionals is becoming
very open, while cooperating with overseas diplomatic missions, JETRO, etc. [Repeat]ii) Measures to utilize attraction of Japan① Enhancing the initiatives to promote inward foreign direct investment• Based on the “Final Report of the Working Group for Revising Regulations and Administrative
Procedures” (approved by the Working Group for the Revising Regulations and Administrative
Procedures, under the Council for Promotion of Foreign Direct Investment in Japan, on April
24, 2017), the Government will effectively solve issues that foreign companies face in relation
to regulations and administrative procedures. In addition, the Government will introduce a“personal advisors system for foreign companies” into JETRO. Also, the Government will takemeasures such as disseminating English information in 10 focused fields, enhancing
consultations for foreign companies and resolving individual issues by persons in charge andteams of specialists through cooperation with related ministries and agencies.
• Particularly, the Government will actively attract the high value-added division of foreigncompanies such as research and development to bring about innovations in Japan.
• Regarding the “Measures to Expand Inward Foreign Direct Investment (“Reform 2020”
Projects)”, the Government will implement the following: a) organizing events for businessexchanges toward the Regional Business Conference which will be held between 2019 and2020, in order to connect exchanges between Japan and foreign local governments withbusiness interactions between Japanese and foreign companies. In addition, b) considering an
intensified implementation of matching events for large companies, investors, and venturecompanies with a target on the Global Venture Summit in 2020.

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② Promotion of Cool Japan• The Government will disseminate the attractions of Japan such as contents, food, designs, andtourism, domestically and internationally, utilizing such facilities as overseas diplomatic
missions and Japan Houses. While seeking synergy effects, the Government will bring about
the economic growth through market expansion for regional products and increase of foreign
visitors. As essential initiatives of this process, the Government will promote measures that
contribute to the creation of businesses and sustainable development of Cool Japan-relatedindustries, by effective utilization of the Cool Japan Fund as well as the Cool Japan
Public-Private Partnership Platform.
• Based on the “Initial Report of the Review Session on Cultivation of Human Resources for CoolJapan” (approved by the Review Session on Cultivation of Human Resources for Cool Japan on
May 26, 2017), the Government aims to develop an environment whereby the Government will
strategically promote cultivation and accumulation of human resources for Cool Japan. This
includes support on cultivation of producers, establishment of practical systems of high-level
education based on industrial needs, cultivation and utilization of human resources who can
produce regional attractions and new brands and develop them overseas, and utilization andaccumulation of foreign human resources.
• As an initiative that directly leads to the vitalization of regional economy, based on the “Final
Report of Review Session for the Establishment of Hubs for Cool Japan” (approved by the
Review Session for the Establishment of Hubs for Cool Japan on May 17, 2017), theGovernment will promote cooperation among the hubs inside and outside of Japan (including
the Japan House) and industries as well as establishment of database for regional products.
• In order to promote overseas development of films, based on the “Report of Task Force
Concerning Film Development Policies” (approved by the Task Force Concerning Film
Development Policies on March 28, 2017), the Government will promote measures such as
development of basis for international co-production, locational support for internal andexternal works, enhancement of functions of film centers, development of interests on Japanesefilms through film festivals.
• Regarding the overseas development of contents, the Government will promote further overseas
development including achievement of new target for overseas sales of broadcast contents. This
will be done through enhancement of support for local broadcasting stations, and throughconsideration of environmental development for procurement of funds, and the processing
scheme of rights for contents production with overseas market in mind.
• Based on the “Policy on Handling of Amendments concerning the Liaison Meeting on
Promotion of Export of Japanese Alcoholic Beverages” (approved by the Liaison Meeting on
Promotion of Export of Japanese Alcoholic Beverages on March 28, 2017), the Government
will further expand export of Japanese alcoholic beverages through the market development
and expansion of market utilizing the Japan Food Product Overseas Promotion Center(JFOODO), improvement of quality and brand power through promotion of utilizing
geographical indication system, and promotion of sake brewery tours.
③ Promotion of clean and attractive “Japanese IR” (Integrated Resort) development• Following the enactment of the Integrated Resort Promotion Act at the end of last year, the172Government carries out legislative work with an aim to present the outline this summer, and try
to enhance public understanding.
• By promoting integrated resort which contains family entertainment facilities, international
conference halls, exhibition centers and so on, and by utilizing Japanese traditions, culture, andart, the Government will create internationally competitive extended-stay style tourism. The
Government expects significant economic impact through large-scale investments. The
Government also expects nation-wide economic benefits by encouraging IR visitors to extend
their travel outside the IR. The Government will ensure that profit from casino is utilized for awide range of public purposes. The Government will introduce the world’s highest-standard
regulations over casino, ensure adequate administrative capacity and competency necessary forstrict implementation of those regulations, and take thorough and sufficient measures to address
various concerns including addiction.
④ Invitation of 2025 World Exposition• The Government will invite and host the 2025 World Exposition in Japan as a trigger for taking
in overseas growing markets through making it an opportunity to disseminate the futuresystems of society and economy as well as life styles brought by Society 5.0 to the world, andto promote innovation.
• In preparation for the vote to determine the host country at general meeting of BIE (Bureau
International des Expositions) to be held in November next year, the Government will takenecessary measures with local governments and business communities across Japan to gain
domestic and international support.
⑤ Taking in growing markets through collaboration with communities of Japaneseimmigrants and descendants (“Nikkei”) overseas• In order to develop markets of Latin America and the Carribean and other regions throughcollaboration with communities of Japanese immigrants and descendants (“Nikkei”) there, theGovernment will improve and promote publcity of Japanese culture/contents/events, Japanese
language education, enhancement of educational functions of Overseas Education Facilities
overseas, delivering of Japan-related information, training of Nikkei farmers as well as
business interactions with Japanese companies, inbound tourism by Nikkeis, development ofdemand for studying in Japan, and exchanges in the fields of science and technology, utilizing
institutions such as overseas diplomatic missions, Japan Houses, and the Japan Foundation. The
Government will also expand and promote, in cooperation with the Japanese local governments,
measures to enhance network with Nikkei communities and those who have personal ties withJapan.

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