The excessive strength of the JPY has been reversed, and share prices have climbed as a result of monetary and fiscal policy introduced since the Abe Administration took office. The focus has shifted to creating real demand via a growth strategy. By promoting innovation and regulatory reform, the agricultural, healthcare and nursing, and environmental markets are expected to expand. These sectors are promising fields with significant potential growth. However, Japan must achieve a primary balance surplus by 2020 in order to maintain international confidence, and has no time to lose in doing so. Given these conditions, the important perspective is prioritizing efforts to create real demand in overseas markets quickly.

Generating real growth quickly depends on strong, profitable domestic industries of sufficient scale being fully competitive in global markets—the US, Europe, and Asia. The JPY has recently been correcting due to monetary policy, and Japan's strength industries—automobiles and electronic parts—have regained their price-competitiveness in overseas markets. Further, selling Japanese infrastructure systems and products is also critical in the most promising Asian growth markets. Global demand for social infrastructure is tremendous, with USD8 trillion dollars expected to be spent for capital expenditures through 2020 in Asia alone. Infrastructure-related businesses are promising areas in which Japanese companies are highly competitive because of their records for safety, precision, and efficiency. Measures involving input from the private sector—like trade and sales efforts jointly led by government and commercial leaders and systemic reviews in order to strategically utilize ODA loans in JPY—are being promoted.

Competitiveness in international markets requires efforts like bold deregulation. We expect the Japanese Government to continue to foster the business environment and promote support measures based on public-private collaboration. Improving strategy—managing a timeline of measures prioritized and divided into short, medium, and long terms—is critical. The Government should thus manage the planning process from all dimensions in order to realize goals and promote realistic and strategic measures that would yield clear results quickly.