Executives' Comments Press Conferences
Chairman Sakakibara's Statements and Comments
at His Press Conference
- Secondary Employment and Side Jobs
- U.S. Corporate Tax Reform
- Suspension of Operation at Ikata No. 3 Nuclear Reactor
- Issue Regarding Construction Work for the Chuo Shinkansen Bullet Train
- One Belt One Road Initiative
Secondary Employment and Side Jobs
Certain media today reported that Keidanren has changed its stance to accept secondary employment. This is an important issue, and I would like to reiterate Keidanren's position on the matter. At my press conference on January 10, 2017, I stated that Keidanren was not in a position to encourage secondary employment and side jobs. While such employment can have positive aspects, including human resource development and the broadening of employees' skills, it also presents many problems, such as reduced work performance as a result of side jobs, risk of information leaks, management of overall working hours, and responsibility for social insurance and unemployment insurance premiums.
One survey has indicated that 85% of Japanese companies prohibit secondary employment or side jobs in their employment regulations, while the remaining 15% of companies allow such employment. Companies should make their own decisions regarding secondary employment and side jobs according to their specific business conditions; it is not for Keidanren to recommend such employment to its member companies. Our stance has been consistent throughout: even when Keidanren was questioned by the Ministry of Health, Labour and Welfare's investigative commission, its position was the same. Keidanren has not now adopted a position of encouraging secondary employment or side jobs, and it has not changed its policy. We propose to adhere to this stance in the 2018 Report of the Committee on Management and Labor Policy.
The government's Action Plan for the Realization of Work Style Reform drawn up in March 2017 included a proposal to move toward accepting secondary employment and side jobs in principle, making such employment more widespread. This reflected the view that such employment can be helpful for development of new technologies, open innovation, promotion of entrepreneurship, or as a means of making the most of life after retirement. However, this does not mean that Keidanren is requiring its member companies to consider accepting secondary employment and side jobs. Such employment has its positive aspects, but numerous issues still remain. Keidanren will not therefore be championing these types of employment, but will instead leave it to individual companies to decide.
U.S. Corporate Tax Reform
As a result of the recent tax reform in the United States, federal corporate tax will be reduced from 35% to 21%. There appear to be differences between states, but the corporate effective tax rate will decline to 27.98%, making the U.S. tax rate advantageous compared to Japan's 29.74%. We still need to scrutinize the final proposal detailing matters such as the ways in which the tax base will be expanded, but it is my understanding that for companies doing business in the U.S. market the reduction in the corporate tax rate is a positive factor that will benefit them directly.
Keidanren has consistently called for Japan's corporate effective tax rate to be lowered to the OECD average of around 25%. In light of the recent corporate tax reform in the United States, we will continue requesting and urging the Japanese government to act. How any tax cut would be funded is a matter for future discussion, and it is of course necessary to consider such funding in the context of the national budget and of compatibility with fiscal consolidation.
Suspension of Operation at Ikata No. 3 Nuclear Reactor
With regard to the Hiroshima High Court's decision to approve a plea to suspend operation at Ikata nuclear power plant's No. 3 reactor, I know that it is not my place to comment on individual judgments and I should not interfere.
However, if I were to venture a comment, it would be to say that this judgment is unfortunate considering the Ikata No. 3 reactor had passed screening based on the Japanese Nuclear Regulation Authority's safety standards, which are among the most stringent in the world, and the local community's understanding and consent for restarting the reactor had been obtained. Keidanren's fundamental approach is that we want nuclear power plants that have passed the Nuclear Regulation Authority's screening and obtained the understanding and approval of the local community to be restarted as soon as possible.
On December 7 this year, when I inspected the Ikata nuclear power plant, I was able to observe at first hand the safety measures taken to guard against the risk of natural disasters such as volcanic eruptions, tornadoes, and earthquakes. I also heard that the plant had passed the Nuclear Regulation Authority's safety screening, including assessment of its measures to deal with volcanic eruption and other volcano-related precautions. It now appears that Shikoku Electric Power Co. will file an objection requesting reversal of the decision, so we will keep a close watch on any further developments.
Issue Regarding Construction Work for the Chuo Shinkansen Bullet Train
The Chuo Shinkansen bullet train is a key infrastructure project involving fiscal investments and loans at the national level. In undertaking the relevant construction work, therefore, it is essential that both the party issuing contracts for the work and the companies granted such contracts comply with laws and regulations and ensure that they do nothing to arouse suspicion among the Japanese public. We would like an investigation to be conducted to clarify the facts as soon as possible, and we will watch future developments closely.
One Belt One Road Initiative
At the Belt and Road Forum summit on international cooperation held in Beijing in May 2017, a personal letter from Prime Minister Shinzo Abe was delivered to President Xi Jinping. I understand the letter stated that Japan would join other nations in cooperating actively with the One Belt One Road initiative, provided that the two sides could reach agreement on principles including openness, transparency, and economic viability. For Japan, these are the fundamental guiding principles in dealing with One Belt, One Road, and Japanese companies are likely to participate actively in the initiative, primarily in the infrastructure sector. At the Japan-China CEO Summit held in Tokyo on December 4 and 5, the Japanese and Chinese sides again affirmed that they would cooperate according to these principles with regard to One Belt, One Road. Some specific examples of such cooperation are now starting to get under way. In its future dealings with China, Japan will continue to follow this same course.
As we pursue closer economic relations between China and Japan, China is particularly focused on environment-related cooperation, as we are. With regard to the severe air pollution caused by PM2.5 and other related problems, there is a strong desire in China to learn from Japan's experiences and adopt Japanese technology. Indeed, the Japan-China Green Expo held for the first time in six years in Beijing in June 2017, attracted 35,000 visitors. This indicates that Chinese interest in environmental technologies is greater than ever. Japanese companies will therefore continue contributing to solutions for China's environmental problems. I believe that economic cooperation through environmental technologies will become a major driving force in economic exchange between China and Japan.