The [government’s economic] measures include reform of social systems and support for launching the Fourth Industrial Revolution—new businesses that harness artificial intelligence (AI), robots, and the Internet of Things (IoT). By the end of fiscal 2017, the Ministry of Economy, Trade and Industry will create a private-public institute for joint research on AI in Kashiwa City, Chiba. It aims to use AI technologies, an area of strength for the United States, and apply them to Japan’s specialty of manufacturing.

Western countries lead in Airbnb and other areas of the sharing economy, which is expected to increase in market size in the future. Japan lags behind in the sharing economy, however. The government is hammering out deregulation, but coordination with conventional industries is difficult. There is also the risk that it will nip new industries in the bud without leading to technological innovation and services suited to demand.

Another issue is developing human resources skilled in AI and other state-of-the-art technologies. As part of its economic growth strategy, the government is adding computer programming to primary school curricula. To respond to changes, measures to improve computer science education at universities are also indispensable.