FACTBOX-Main proposals in Japan PM Abe's draft growth strategy

by Reuters
Tuesday, 3 June 2014 12:08 GMT

TOKYO, June 3 (Reuters) - Following are key proposals in Japanese Prime Minister Shinzo Abe's economic growth strategy, according to a 60-page early draft seen by Reuters. Many high-profile policy areas are not addressed in detail, suggesting they may remain contentious.

Abe is to announce the programme late this month.

PRIVATE-SECTOR, FOREIGN INVESTMENT: - Targets opening up $30 billion in public infrastructure projects such as airports to management by private investors. Targets tripling the value of projects financed through public-private partnerships by 2022 from $39 billion in 2012. - Targets doubling annual foreign direct investment to nearly $345 billion by 2020. Japan's inbound direct investment is the lowest among OECD countries at 3.5 percent of GDP. CORPORATE GOVERNANCE: - The Tokyo Stock Exchange will compile by mid-2015 a Corporate Governance Code to bring oversight of listed companies into line with international standards. The plan calls for banks to have at least one outside director; this is weaker than previous recommendations from within Abe's party to have multiple outside directors for all listed companies. TAX: - Does not mention Abe's call for reforming corporate taxes. Many in his party are pushing to cut the tax rate below 30 percent from the current 35.6 percent, but fiscal hawks are pushing to force more companies onto the tax rolls to offset the loss of revenue.

GPIF: - Does not detail Abe's plans for the $1.26 trillion Government Pension Investment Fund, the world's biggest pension fund. Abe's government is pushing GPIF to buy more stocks and invest less in government bonds; asset allocations are to be worked out in the coming months. TRADE: - Free trade, a prominent issue in last year's growth strategy, does not appear in the new draft. This may reflect that Japan and the United States have not reached a trade deal, which will be key to an ambitious 12-nation Trans-Pacific Economic Partnership.

LABOUR: - Pledges to boost employment of older workers and young people, but many politically sensitive issues are marked as still under debate. Unresolved issues include whether the government will make it easier for companies to dismiss workers. - A section entitled "the use of foreign human resources" remains blank, indicating the sensitivity of expanding a foreign trainee programme in a country long averse to wide-scale immigration. 'WOMENOMICS': - Targets raising the proportion of women corporate managers to 30 percent by 2020 from last year's 7.5 percent. Requires listed companies to disclose their women-in-management ratios. Targets expanding places at Japan's day-care centres by 400,000 by 2017. ENERGY: - Pledges to reform the electricity market by 2020, ending monopoly control by utilities. Promotes import of U.S. liquefied natural gas. Reiterates Abe's plan to restart nuclear power plants that pass tougher safety checks imposed after the 2011 Fukushima disaster. CASINOS: - Abe's push to legalise casino gambling, a high-profile attempt to attract investment and tourism, is not in the draft. Parliament is expected to begin debating a casino bill next week, but supporters hope it will also be in Abe's growth strategy, signalling that it is a policy priority. HYDROGEN FUELLING STATIONS: - Vows to ease curbs on hydrogen fuelling stations. Toyota Motor Corp is preparing to launch a hydrogen-powered car in the United States, Japan and Europe in 2015, a major bet on fuel-cell technology by Japan's top automaker. ROBOTICS: - Promises a "robotic revolution" forum in a bid to boost productivity. By 2020, Abe wants a 20-fold increase in the use of robots in agriculture and a doubling in manufacturing. AGRICULTURE - Does not address whether corporations will be allowed to own farmland, considered key to opening up Japan's cosseted farm sector. (Reporting by Takaya Yamaguchi; Writing by Antoni Slodkowski; Editing by William Mallard and Ron Popeski)

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