Japan has unveiled a new action plan to attract more foreign investment and talent in an effort to boost economic growth and enhance its global competitiveness. The government aims to attract 100 trillion yen (approximately $750 billion) worth of foreign direct investment by 2030, which is more than double the 46.6 trillion yen of foreign investment recorded at the end of 2022.
The plan, which aims to capitalize on the country's weak yen to
attract foreign investment, also seeks to attract more foreign workers and
entrepreneurs, including remote workers commonly referred to as "digital
nomads." The move comes as the COVID-19 pandemic and Russia's war in
Ukraine highlight the need to strengthen supply chains and ensure national
security.
The action plan outlines strategic areas for investment,
including semiconductors, digitalization, green technology, and healthcare. To
achieve this, Japan will use funds and other resources and develop necessary
human resources through collaboration between the government, firms, and
academia.
Japan's Prime Minister, Fumio Kishida, considers digital and
green transformation as critical areas for investment, as he aims to achieve a
virtuous cycle of growth and redistribution. He says, "The action plan is
one that will make Japan more open to the world."
The project to build a Taiwan Semiconductor Manufacturing Co.
chip-making plant in Kumamoto Prefecture in southwestern Japan is an example of
the public and private sectors collaborating to attract foreign investment,
with the government providing financial assistance.
Japan has struggled to attract investment and talent from overseas compared to other countries, with outward investment in 2022 totaling 270 trillion yen, which is over five times the inward investment figure. The government intends to address this issue by allowing more foreign workers to enter the country and by simplifying the visa requirements for highly skilled professionals.
The government will consider ways to attract digital nomads who
travel while working remotely for companies, including those located overseas,
as the COVID-19 pandemic has prompted a fresh look at work styles. Although
Japan does not issue a visa specifically for such remote workers, dozens of
nations such as Iceland and Portugal do.
The action plan also envisages allowing entrepreneurs who want
to start a business in Japan to remain longer under a "startup" visa
that currently allows for a maximum stay of up to one year. A record 3 million
foreign nationals were living in Japan at the end of 2022, according to the
government. With labor shortages already acute and the working population
projected to shrink further, Japan is gradually opening its doors to foreign
workers.
In a rapidly changing global economy, Japan's ambitious plan to attract
foreign investment and talent marks a significant step towards enhancing its
competitiveness and securing its economic future. As the country opens its
doors to foreign workers and entrepreneurs, the question arises: Will this plan
prove successful in helping Japan achieve its target of $750 billion in foreign
investment by 2030? Only time will tell, but it's clear that Japan's vision for
a more open and connected economy is worth watching closely.
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