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Policy Proposals  Comprehensive Strategy Approaches to Current Issues ( March 2020 )

March 9, 2020

1. Current Conditions of and Outlook for the Japanese Economy

The economic climate continues to show protracted weakness in areas such as exports and production, reflecting the influence of such factors as the slowdown in overseas economies and the prolonged trade friction between the United States and China. Under these circumstances, business confidence is declining due to the worldwide spread of novel coronavirus infections.

We need to closely monitor the impact of contagion on the real economy and sentiment in areas including consumption, exports, and production, as well as financial market trends.

2. Responses to Novel Coronavirus

Measures to prevent the spread of novel coronavirus infections are a huge issue for not only the health and safety of employees and the population at large, but also Japan's economic prospects. The government is flexibly putting in place all possible measures, and Keidanren will also contribute to united public- and private-sector efforts to prevent the spread of infection, aiming at a swift return to normality. At the same time, we urge the government to provide information on the current state of contagion and support measures related to preventing the spread of infection, and we will share such information with our members.

3. Realizing Society 5.0

We will publicize our policy proposal for "Society 5.0" in Japan and overseas, seeking to spread awareness of this proposal for a society where digital transformation combines with the imagination and creativity of diverse people to solve social problems and create new value. The Society 5.0 concept—which originated in Japan—can also contribute to the achievement of the Sustainable Development Goals adopted by the United Nations. At the same time, we will expedite the practical implementation of Society 5.0 by pursuing digital transformation and diversifying in every aspect of our economy and society, and collaborating with a diverse range of entities in Japan and overseas. To this end, Keidanren will join forces to deliberate on and enact measures for realizing Society 5.0, including the restructuring of industry.

4. Energy and Environmental Issues

We will urge the government to create a stable supply of energy at prices that compare favorably from an international perspective and to establish an investment environment for this purpose. This will contribute to achieving safety combined with energy security, economic efficiency, and environmental conservation ("S+3E") that takes into account the overall domestic and international situation, as well as Japan's own particular circumstances. As part of these efforts, we will work towards steady progress in institutional reform aimed at creating a sustainable electrical power system and making renewables into Japan's main sources of power. In addition, we will take steps to achieve a virtuous cycle that balances environmental considerations with growth through joint efforts by the government and the private sector, such as the promotion of climate change policies focused on innovation through "Challenge Zero" and other initiatives.

5. Reforming Working Styles and Promoting Diversity

We will help companies to implement measures addressing working style reform legislation by lobbying the government in various ways. We will also call for resubmission of the bill on expanding eligibility for discretionary working hours systems. Meanwhile, we will publicize the guidelines on the prevention of harassment as well as respond to moves toward implementing the new system for accepting human resources from overseas. Additionally, we will act to promote diversity in the workplace through the heightened participation and advancement of women, younger and older people, foreign nationals, people with disabilities, and members of the LGBT community. In another initiative, we will pursue dialogue with universities about such issues as the attributes required of human resources from now on, medium- and long-term employment, and potential reforms for university education.

6. Spring Labor-Management Wage Negotiations

Since 2014, Japanese companies have contributed to efforts to end deflation and realize a virtuous economic cycle by redistributing the fruits of increased profits in the form of improved compensation for their employees. For the 2020 spring labor-management wage negotiations, Keidanren, through the report of its Committee on Management and Labor Policy, will call on employers to consider wage increases based on the situation in each company in accordance with the basic principles for determining wages, in order to maintain the momentum for wage increases. It will also work actively on the improvement of the working environment and overall enhancement of workers' compensation that contributes to human resources development.

7. Economic Relations with Major Industrial Powers

To make cooperative relations with the United States even stronger, we will take action at various levels to build closer communication with that country based on the US-Japan trade agreement. We will, moreover, monitor US policy trends relating to US-China relations and sensitive technologies. Meanwhile, we will extend and deepen our cooperative relationship with Europe through the Japan-EU EPA. In light of the UK's withdrawal from the EU, we will request action including those to realize an UK-EU FTA and an EPA between Japan and the UK at an early date. We will actively participate in materializing the eight-point cooperation plan with Russia and the Japan-Russia year of regional exchanges (2020-2021), as well as continuing to appeal for improvement of the business environment in Russia.

It is anticipated that India, the ASEAN economies, and other Asian countries will join China as driving forces in global economic growth. We will support efforts to develop and further strengthen close and mutually-beneficial relationships with these countries.

8. Sustaining and Reinforcing the Rule-based International Economic Order

To aid in the development of rules for trade and investment in the Asia-Pacific region, Keidanren will call for expanded participation in the TPP11 as well as the early establishment of the 16-country RCEP and the Japan-China-South Korea Free Trade Agreement. Additionally, we will push for reforms to the WTO, which serves as the core of the multilateral system of free trade. Furthermore, to encourage expanded exports of quality infrastructure-related goods, we will engage in facilitating cooperative relations through policy dialogues with public- and private-sector leaders in Japan and other countries in the region.

9. Hosting Successful National Events

We will work in unison with the government and relevant organizations to ensure flawless preparations for the success of the Tokyo Olympics and Paralympics this summer, and link these efforts to the revitalization of Japan's economy and its subsequent growth.

10. Disaster Prevention and Mitigation, and Building National Resilience

In light of the major natural disasters that have occurred in recent years, Japan needs to do all it can to not only help those caught up in disasters and rehabilitate the areas affected, but also to prevent and mitigate disasters, and to build national resilience. Targeting further improvement in Japan's level of resilience in order to ensure security and safety, we will urge the government to steadily execute the supplementary budget and its Fundamental Plan for National Resilience, and to promptly decide on the necessary measures, including measures to make better use of digital technologies and pursue innovation. At the same time, we will encourage companies to also take action.

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Comprehensive Strategy