- Open the Door to Society 5.0 — Recommendation to the Digital Extraordinary Administrative Advisory Committee
- Japan's Economy
- Foreign Exchange Rates
- Tokyo Stock Exchange's New Market Structure
- Easing of COVID-19 Border Measures
- Sakhalin Project
- Evaluation of Six Months of the Kishida Cabinet
- 2030 Winter Olympics and Paralympics
Open the Door to Society 5.0 — Recommendation to the Digital Extraordinary Administrative Advisory Committee
"Open the Door to Society 5.0," our recommendation to the Digital Extraordinary Administrative Advisory Committee, or the so-called Digital Rincho, was drawn up at the meeting of the chairman and vice chairmen today.
Partly in response to a request from Keidanren, the Digital Rincho was launched under Prime Minister Fumio Kishida last November. Since its inception, the Rincho has been working on a comprehensive review of regulations. The next three years of intensive reforms will be Japan's greatest and last chance to transition to Society 5.0. With such an awareness and sense of urgency, Keidanren decided to compile its policy recommendations so that its views based on the member companies' business operations can be reflected in the "Collective Regulatory Review Plan" the Rincho is drafting this spring, as well as in future reforms.
The cross-sectional review of regulations the Digital Rincho is undertaking will spur digital transformation (DX) in all industries. DX will improve productivity in businesses, relieve labor shortage in workplaces, as well as increase employees' income, bringing about a virtuous cycle in the overall Japanese economy. Keidanren will give full support to the Digital Rincho's efforts.
This recommendation spells out the concrete steps toward opening the door to Society 5.0. The first step is "general review of existing regulations and collective digital revision." As the initial reform, all administrative procedures must be made truly digital, completed without a single piece of paper getting in the way.
The second step is "building new systems and infrastructure." The laws and regulations cannot possibly keep up with the technological innovations happening on a daily basis. Agile, i.e. flexible system building, is necessary for the actual introduction and application of AI, robots, and other advanced technologies in all aspects of construction, agriculture, nursing care, and other sectors. Furthermore, data linkage, starting with Individual Number (My Number), is also an important issue.
The last step is "digital-based system building." It is necessary to build in mechanisms for the government to adapt autonomously to advanced technology in order to preclude the regression of reforms.
Keidanren will continue to demand that the government deal with this issue with a strong resolve and speed based on the "Collective Regulatory Review Plan" to be compiled in May.
[Asked why DX has not made much progress] This is probably because the people have not been able to benefit broadly from the convenience. Solutions should be worked out through the promotion of database linkage and by using My Number. DX and the promotion of the use of My Number are indispensable for introducing the concepts of fairness and impartiality in social security and taxation.
Rising cost of resources and restrictions in the supply chain triggered by Russia's invasion of Ukraine have resulted in bearish trends both in business confidence and the real economy. The most recent Bank of Japan's Tankan Survey (for March) shows that the business conditions DI of large enterprises also fell slightly. From now on, COVID-19 prevention measures are expected to move from the pandemic to the endemic approach. We hope that as a result, the normalization of social economic activities and the effect of various policies will bring about economic recovery.
Foreign Exchange Rates
It is most important for foreign exchange rates to remain stable. For now, there is no concern about stagflation, and we will continue to closely monitor price movements and other variables. There is talk about good yen depreciation and bad yen depreciation, but the fact is this may be favorable for the business of some companies but unfavorable for others. No hasty judgments should be made.
Tokyo Stock Exchange's New Market Structure
The market segments used to be complicated and overlapping. This investor-friendly restructuring is of great significance. The Tokyo Stock Exchange (TSE) plays a major role in all aspects of the active use of the vast personal financial assets in a super aging society, the creation of startups, and so forth, so it needs to remain an attractive market for Japanese and foreign investors. In light of the TSE's restructuring, we look forward to the sustained growth of the listed companies, their efforts to enhance corporate value, improved dialogue with investors, and further development of the Japanese stock market.
Easing of COVID-19 Border Measures
Keidanren has persisted in lobbying for removing the daily cap on entrants and reviewing the COVID-19 risk levels of foreign destinations. We appreciate and welcome the government's decision to increase the daily cap of entrants from 7,500 to 10,000 (to take effect on April 10) and lower the COVID-19 risk level assessment. We hope for further rationalization and greater efficiency of quarantine procedures at airports and the eventual removal of the daily cap on entrants.
The government's decision not to withdraw from the Sakhalin Project is reasonable. Imports of LNG from Sakhalin-2 account for some 8% of Japan's overall LNG imports, and it will not be easy to replace them immediately. While the US and the UK were quick to announce the suspension of imports from Russia, it must be noted that these two countries are both oil producers. On the other hand, the European countries, which do not produce oil, continue their transactions with Russia.
While Japan needs to reduce its dependence on Russia for energy in the long term, it is not realistic to stop energy imports from Russia at this point.
Evaluation of Six Months of the Kishida Cabinet
The Kishida cabinet has maintained its high support rating. The Prime Minister must be feeling confident. These were six commendable months. In domestic politics, he has listened closely to the people's voice and implemented policies steadily, while in foreign affairs, he is playing a leadership role keeping in step with the G7.
2030 Winter Olympics and Paralympics
The Olympic and Paralympic Games are a rare opportunity to bring great inspiration to the people and strengthen their solidarity. This is also true for the 2030 Winter Olympics and Paralympics. I think Sapporo is a great candidate venue. If Sapporo is selected to host the Games, we will offer our cooperation.