Japan's experience with COVID-19 began more than six months ago when the Diamond Princess came to port. In the time since then, the coronavirus has dealt major blows to both the economy and society as a whole. Still, there may come a day when we view this experience as a pivotal turning point in Japanese history, much as the arrival of the US envoy under Commodore Matthew Perry in 1853 set in motion the events that culminated in the Meiji Restoration. I sincerely hope that this becomes the position the COVID-19 pandemic eventually occupies within our history books.

Efforts to deal with the virus have brought to light a number of issues in Japanese society. The most telling of these is how far behind Japan is in the application of digital solutions and technology. People have also come to realize that many government procedures remain mired in the past, a fact clearly evidenced by the host of issues surrounding the Social Security and Tax Number System. It is regrettable that these shortcomings crimped the government's bold fiscal stimulus measures, ultimately diminishing much of their intended effect.

In exposing these inadequacies, however, I believe the pandemic has unleashed the catalysts for accelerating the digital transformation of Japanese society. In a bid to curb the spread of the virus, people turned to digital technologies to work from home, consult with doctors online, and attend classes virtually. The firsthand experience many business professionals have now had with teleworking will help bring about a fundamental change in the way people work. Virtual meetings, seminars, and sales pitches—all drawing on the use of digital tools—have rapidly taken root, while at the same time translating to productivity gains by cutting down on costs and travel time. Digital transformation solutions provide the foundation for remote styles of living and doing business, promising new avenues for revitalizing regional communities and their economies.

Looking at the stock market, the Nikkei Stock Average plunged below the 17,000 mark in March of this year. However, it did not take long for stocks to bounce back to the levels seen at the start of the year, prompting many to say that the market was not accurately reflecting the true state of the economy. The bold fiscal and monetary policy moves made in response to the COVID-19 pandemic did their part in propping up the markets. At the same time, though, we cannot overlook the fact that expectations for developments down the road are also being priced into shares. The eyes of the market are on the new business opportunities and scope for corporate earnings growth many expect as the digital transformation of Japanese society marches onward.

Meanwhile in the US, the tech-heavy NASDAQ Composite has vastly outperformed the Dow Jones Industrial Average amid the pandemic, topping the 10,000 mark for the first time in the history of the index. The GAFAM companies (Google, Amazon, Facebook, Apple, and Microsoft) are leading the way in the ongoing digital transformation, which has picked up its pace as society works to grapple with the impact of COVID-19. Powered by this digital shift, their collective market capitalization has grown to $6tn, which is greater than the combined figure for all the companies listed on the Tokyo Stock Exchange. In Japan also, we are seeing the market start to price in similar expectations. These include the anticipation that productivity throughout society, and eventually corporate value, will improve as the public and private sectors team up to turn the response to the pandemic into an impetus toward the nation's digital transformation.

In closing, I believe it is worth reiterating the main points outlined in the Keidanren Policy for Fiscal 2020. Now is the time to pursue sweeping reforms for creating a truly resilient economy and society. The key to this will be a successful digital transformation that puts us on course to realizing Society 5.0.