Enhansing Global Competitiveness

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1 Chapter 5. Enhansing Global Competitiveness Activating the economy As structural reform progresses in Japan, and to conquer deflation, we are promoting Special Zones for Structural Reform in conjunction with setting policies to revitalize production, perfect safety nets for employment and small and medium companies, activate the real estate market, promote housing lending, and pursue Urban Renaissance by encouraging private investment and spending. Construction of extended transportation networks Building trunk roads Japan s level of trunk road completion lags behind that of the U. S. and Europe; it is vital to continue the construction of high standard trunk roads for efficient and effective utilization of Japan s land. Furthermore, in light of reforms in public works, it will be necessary to study effectiveness, needs and methods in regard to continued future construction (International comparison of trunk road completion levels) Extension of highways since 1982 (km) 2, 15, 1, 5, United States 8,km France 5,7km Germany 7,919km China km Japan 3,232km (Year) China (19,437km) United States (89,232km) France (11,5km) Germany (11,515km) Japan (6,959km) Note: Japan, China 21 France 2 U.S., Germany 1999 Expansion of trunk railroad network The trunk railroad network is basically nearly complete, but it is difficult to say that it is sufficient in terms of high speed services or railroad facilities. Therefore, we are proceeding steadily with construction of additions to the Shinkansen; The December 22 opening of the Tohoku Shinkansen Morioka Hachinohe section has produced a major reduction in riding time. Moreover, by establishing a reserve fund system for extensive renovation, making trains faster on ordinary trunk lines and doing R&D on such technologies as the linear motorcar, we are continuing to build the trunk railroad network over a wide area. 51

2 113. (First Departure Ceremony for the Tohoku Shinkansen Hayate ) Improving domestic air network The number of domestic passangers using Haneda Airport is steadily increasing, and there are fears that Haneda already has no capacity. Therefore, we are treating construction at Haneda and other major urban area airports that form the hub of our air network as a highest priority task Domestic passenger numbers at Haneda Airport and future estimates Load factor Actual load factor million million 43.2 million 22. million 2 1 Actual number of passengers FY million million Estimated future demand 73.2 million (reference value) Future estimate assumptions Assuming that the expansion project will be completed by 29 (million) (Year) Annual number of domestic passengers International transportation network construction International airport network construction The level of international hub airports in major metropolitan areas is insufficient, and they cannot meet demands for increased service or new operators; this cannot help but injure international competition. Therefore, we are strengthening capacity at international hub airports in major metropolitan areas: 1. Narita Airport construction; 2. Increasing night and early morning charter flights from Haneda Airport; 3. Pressing for 2nd stage construction at Kansai International Airport; and 4. Construction of Chubu International Airport. In addition, we are vigorously conducting air negotiations with other countries for new air agreements and revisions. 52

3 115. (Actual and estimated number of passenger at Narita Airport) 22 completion of interim parallel runway increases flight framework from 135, to 2, ( 1.5) Reaching estimated flights of 2, by about 28 and 22, by about 21 will require efforts to increase airport capacity No. of passengers (1,) 7, 6, 5, 4, 3, 2, 1, Source: MLIT Annual no. of flights Actual no. of passengers stimated no. of passengers (reference value) 22, 2,5m 2, 2,5m 2, 2,18m Flight framework 1,246 S , ,273 2, ,758 No. of flights 199 H EDiscussion with local people for increased capacity 3,1 131, , H12 H14 H Calculated on end of summer schedule after provisional joint use Annual flights 183,5 Beginning of provisional joint use of parallel runways H2 H , 2, 15, 1, 5, H Actual no. of flights Strengthening of Transportation Connections Establishment of a multi-modal Transport System We are aiming to offer environmentally friendly, cost effective door to door service, in response to user demand, through functional improvements and focused linkage among hubs such as airports, ports, railways and trunk roads and the roads that connect to them. Improved access to airports In addition to bringing the access time to Narita Airport from the city center down to the 3 minute level through the construction of a high speed railroad, we also aim to improve high speed accessibility by transport to Narita Airport. We also plan further improvements to Haneda Airport access and guarantees of access to Chubu International Airport, etc. 53

4 116. (Expansion of airport capacity in the Tokyo area) Connecting the Metropolitan Asakusa line to Tokyo station Creation of direct lines between Narita and Haneda airports and Tokyo station Installation of passing lines near the Asakusa-bashi station Construction of access roads Early formation of blueprint for Kita-chiba road Early installation of the Tokyo East outer ring road Improvement of access to the Narita New Rapid Line Central Tokyo Narita airport Slightly less than 1 hour (present) 3 minutes or more Haneda airport Narita airport about 15minutes about 7 minutes Renovation project of Keikyu Kamata station Increase in capacity of the airport line of the Keihin Rapid Railway Increase through trains from Yokohama area Expansion and improvement of Narita airport Early completion of 2,5m parallel runway Comprehensive expansion of airport capacity Expansionof Haneda airport Drastic expansion of capacity will enable introduction of scheduled international flights. Building an internationally competitive distribution market Plan to strengthen functions of international distribution points In order to build a marine highway network that is both safe and efficient, we are: 1. Preparing international shipping lanes; 2. Realizing non stop port entry; 3. Constructing core harbors; 4. Achieving one stop (single window) service for port procedures; and 5. Keeping ports open for full services 24 hours per day. Also, we are trying to nurture Super-Hub Container Ports through government private cooperation to realize costs and services comparable to other major Asian ports. 54

5 117. (Constructing a highway network) Elimination of "bottle-neck" bay entrance Safety assurance by removal of shoals Uraga Suido Traffic route Daisan-Kaiho reefizing Business term - from 2 to 27 (schedule) Bay entrance Marine highway to go speedily from the sea to the land Inside a bay Inside a port 24 hours port operation and smart distribution Target to achieve: guarantee of same-day delivery to a shipper 1day 2day 3day Main ports of Japan Main ports in Asia Time shortening The import cargo port storage time from 3-4 days in the present to approximately 2 days in year 25 Changes to one-stop system of harbors Development of "Information route" that utilizes IT Improvement of port access development of container terminal in large deep-water ports Development of fiber optics space to be used in port facility management Building of port management system Sea and land interchange Fiscal 23 : Achieving one-stop (single-window) service for port procedures Creating Super-hab Container Port Target:Challenging container mega-hubs of Asia Lower port cost by more than 3 for competing to the ports of Busan and Kaohsiung Shortening cargo discharge time from 3 4 days to less than one day For best port services Port logistics IT Platform Full-open port operations including CIQ offices Automatization & Mechanizatin Large scale container terminal for accommodating mega container careers For cheap cargo handling Lower terminal cost Good connection to costal shipping Cheaper marine services For forming international logistics bases in costal area Accumulation of logistics industry Forming the optimum transportation system for materials and parts which connects production and R&D bases with foreign business Best practice for container terminal operation Long-term lease arrangements for port assets Large scale terminal operation 55

6 Plans for constructing a high quality and efficient distribution system We are promoting activity in the field of distribution, such as the diffusion of JTRN, the domestic standard for EDI (electronic distribution information) needed for e trading in distribution, ITS technology and GIS (geographical information system). Also, aiming for greater efficiency in intermodal transport, in addition to making interregional distribution more efficient through construction of domestic trade terminals, railroad freight terminals and access roads, we are proceeding with plans on the software side in intracity distribution, such as reducing congestion at bottlenecks through trunk road construction, strengthening facilities for promoting cooperative delivery operations and testing TDM. Reviving and activating the industry Strategies for activating the transport industry We are making studies in the RR industry of the possibilities of mutual use of IC cards for fare payment to improve convenience. In regard to policies to promote competition in the domestic airline area, we are improving user convenience through the participation of new airline companies, by offering preferential flight slots at Haneda Airport and equalizing use conditions at airport facilities. We are also planning such concrete policies as complete privatization of JR, regulating the alternative driver business and Next generation Domestic Sea Transport Vision. Activating the real estate market In order to activate the real estate market, we are promoting the establishment of a market environment through such measures as securitization of real estate, better information on real estate transactions, insuring proper real estate management and fair enforcement of land and building transaction laws. Reviving the construction industry To revive the construction industry, we are aggressively pursuing promoting the establishment of safety nets, evaluation of firms in public works, elimination of poor quality and substandard businesses, study of the introduction of CM systems, measures for construction workers and strengthening the management base for specialized and construction related businesses (Changes of construction investment (nominal value), the number of licensed contractors and employed workers in the construction industry) (trillion yen) 9 Private investment (trillion yen) 8 Government investment (trillion yen) Licensed contractors (1, contractors) 7 Employed workers (1, people) 6 (1, contractors, 1, workers) 9 Employed workers (22 average) 6.18 million FY21 571, contractors Private investment 32 trillion FY22 (total) 57.1 trillion Government investment 25.1 trillion (Year) Note 1: Investment totals for 2, 21 expected. 22 total prospective. Note 2: The number of licensed contractors value as of end of fiscal year (March of following year) Note 3: The number of employed workers total is average. Sources: MLIT Estimate of Construction Investment, Licensed Contractor Survey, MPHPT Labour Force Survey

7 Measures to deal with shipbuilding issues In order to strengthen and maintain Japan s shipbuilding industry, we are devising an integrated strategy and promoting use of support systems to effect smooth realignment of the industry. Furthermore, we are promoting R&D on such maritime technology as the Mega Float Changes in the world shipbuilding industry 1, tons 3,5 3, 2,5 2, 1,5 1, 5 3,42 3, Other Western Europe Korea Japan 8.5 2,867 2,753 2, ,583 2,553 2, , , ,967 1,8331,816 1, , ,6931,682 1, , ,5891, , , , , , Year Note 1: Completion base. Note 2: Values inside bar graph represent distribution ratio. Source: Compiled from Lloyd s source (for ships over 1 Tons) 3,141 57

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