Establishing Strategic Industrial Technology Policy
for Stronger International Competitiveness

Tsutomu Kanai Vice Chairman, Keidanren President, Hitachi, Ltd.

The Japanese economy is experiencing its worst downturn in business conditions since the end of World War II, turning in negative growth in real GDP in fiscal 1997. In order to break through the current difficulties, the most important and the shortest way is to return to basic principles and to tackle the problem head on. I think, therefore, that we must promote, and then quickly execute structural reforms. A resolution passed at the General Assembly of Keidanren last May designated the following as the most important tasks for this year: stabilization of the financial system, fundamental reform of the tax system, and strengthening of the industrial infrastructure.

From my viewpoint as the chairman of the Industrial Technology Committee, the maintenance and improvement of superior technological abilities is the most important theme in strengthening the industrial infrastructure. This does not merely mean that the government should promote only scientific technology, but rather that the government should take action based on a broader understanding of the problem's scope. That is, from the viewpoint of international competitiveness, it is imperative that the government establish a clear policy in these times of "mega-competition." In doing so, international competitiveness policy relates not only to industrial policy but also to economic policy concerning deregulation and taxation, and social policy concerning labor and education policies.

The United States began its recovery in the early 1990s. It is gaining a further lead in international competitiveness over other nations by promoting information technology strategies. I think that this is the result of a national program to strengthen international competitiveness, promoted by the government since the 1980s. Although Japan is now concentrating on structural reforms in order to adjust to global trends, I believe that Japanese policies should be more strategy-oriented in order to strengthen international competitiveness, in addition to implementation of structural reforms.

In particular, I think, one of the most important strategies for strengthening industrial technology is the reform of the education system. The international competitive edge 10 to 20 years from now will depend on the people who are studying now at the primary and secondary levels of education. Higher education is becoming more important than ever not only for university students but also for working people. From this point of view, I would like to promote the strategic importance of international competitiveness in industrial technology by cooperating with other committees.