600 Trillion Yen GDP TargetSTI Policies for Moving Toward

Society 5.0!

Yuko HarayamaExecutive Member

Council for Science, Technology and Innovation(CSTI)

Cabinet Office

Translation by Foreign Press Center Japan (FPCJ)

Japan’s Growth Strategy

06/07/20162

Society 5.0

600 TrillionYen GDP

• Comprehensive Strategy on Science, Technology and Innovation 2016 (May)– Council for Science, Technology

and Innovation• Japan Revitalization Strategy 2016 (June)

– Council for IndustrialCompetitiveness

• “Basic Policy on Economic and Fiscal Management and Reform (June)– Council on Economic and Fiscal Policy

Fourth Industrial Revolution

A Brief Overview of the Current Situation in Japan

06/07/20163

Labor Productivity Trends

06/07/20164

-3

-2

-1

0

1

2

3

4

5

6Japan

Annual growth rate Trend growth

OECD Compendium of Productivity Indicators 2016

Contribution to GDP Growth

06/07/20165OECD Innovation Imperative (2016)

Total economy, annual percentage point contribution, 1995-2013

Trends in Working-Age Population, the Limiting Factor

06/07/20166OECD Innovation Imperative (2016)

Working-age population (15-74) in relation to total population 1990-2060

Share of ICT Investment in GDP

06/07/20167

0.00

1.00

2.00

3.00

4.00

5.00

KOR IRL AUS DEU FIN CAN ESP PRT AUT ITA GBRDNKSWE BEL JPN FRA USA CHE NLD NZL

2014 1995 2001 2007

OECD Compendium of Productivity Indicators 2016

Contribution of ICT capital to labour productivity growth

06/07/20168

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

AUSAUT BEL CANCHEDEUDNK ESP FIN FRA GBR IRL ITA JPN KORNLD NZL PRT SWEUSA

1990-1995 1995-2000 2000-2005 2005-2009 2009-2014

OECD Compendium of Productivity Indicators 2016

Why the Interest in STI?• To reach the target of 600 trillion yen GDP・・・

– Investment in STI ➡ Economic growth– Also・・・

• Addressing social and global challenges• As a source of industrial competitiveness• Driver of regional development• ・・・

• Mainstreaming of STI policies (in public policy, particularly economic policy)

OECD, The Innovation Imperative (2015)➡New challenges:

• “Science and technology policies” AND “innovation policies” AND “economic policies”

• Participation by diverse stakeholders➡Role of the government?

06/07/20169

10

Japanese Science and Technology Indicators 2015*兆円=trillion yen *Funding is nominal amount.*日本:Japan, 米国:U.S., ドイツ:Germany, フランス:France, 英国:U.K, 中国：China, 韓国:ROK

Trends in Upstream R&D Funding

06/07/2016

Proportion of Government Funding for R&D

11

Japanese Science and Technology Indicators 2015 *日本:Japan, 米国:U.S., ドイツ:Germany, フランス:France, 英国:U.K, 中国：China, 韓国:ROK

06/07/2016

12

1.75兆円 1.85兆円 1.85兆円 1.89兆円 2.10兆円 2.28兆円 2.36兆円 2.40兆円 2.35兆円 2.39兆円 2.40兆円 2.46兆円 2.63兆円 2.75兆円

2.22兆円 2.22兆円 2.45兆円 2.55兆円2.76兆円 2.88兆円 3.10兆円 2.97兆円 2.63兆円 2.37兆円 2.50兆円 2.40兆円 2.33兆円 2.21兆円

0.66兆円 0.66兆円 0.75兆円 0.80兆円0.87兆円

0.95兆円1.05兆円 1.07兆円

1.01兆円 1.01兆円 1.01兆円 0.97兆円 1.07兆円 1.19兆円

0.33兆円 0.39兆円0.56兆円 0.61兆円

0.73兆円0.78兆円

0.88兆円 0.94兆円0.86兆円 0.89兆円 0.83兆円 0.87兆円 0.95兆円 0.99兆円

0.75兆円 0.79兆円0.84兆円 0.84兆円

0.87兆円0.93兆円

1.01兆円 1.00兆円0.95兆円 0.94兆円 0.99兆円 0.96兆円

1.03兆円 1.06兆円

0.33兆円 0.35兆円0.24兆円 0.31兆円

0.33兆円0.33兆円

0.32兆円 0.31兆円0.34兆円 0.33兆円 0.32兆円 0.38兆円

0.38兆円 0.35兆円

[9.37兆円][9.30兆円][9.01兆円][8.80兆円]

[9.01兆円][9.13兆円]

[8.81兆円]

[8.67兆円]

[7.70兆円][7.77兆円]

[7.91兆円][7.80兆円]

[8.28兆円][8.92兆円]

90

95

100

105

110

0兆円

5兆円

10兆円

15兆円

20兆円

平成13年度平成14年度平成15年度平成16年度平成17年度平成18年度平成19年度平成20年度平成21年度平成22年度平成23年度平成24年度平成25年度平成26年度

その他

宇宙開発/海洋開発分野

エネルギー分野

物質・材料/ﾅﾉﾃｸﾉﾛｼﾞｰ分野

環境分野

情報通信分野

ライフサイエンス分野

国内総生産(右軸)

(22,058) (18,468) (29,663) (28,608) (22,201) (23,204) (26,908) (21,558) (18,572) (19,223) (16,248)(17,276) (16,250) (19,676)

79.1兆円 83.72兆円4th Science and Tech.Basic Plan2nd Science and Tech. Basic Plan 3rd Science and Tech. Basic Plan

15.4兆円 15.6兆円 15.7兆円15.8兆円

16.7兆円

17.3兆円

17.5兆円 17.4兆円

15.8兆円 15.7兆円16.0兆円 15.9兆円

16.7兆円

17.5兆円

出典：内閣府国民経済計算確報及び総務省統計局科学技術研究調査より内閣府作成

角括弧[ ]内の数字には資本金1,000万～1億円の企業の使用研究費を含む *兆円＝trillion yen小括弧( )内の数字は非営利団体、公的機関、大学等、企業、の機関数の合計使用研究費のうち複数の分野にまたがる研究については、重複して計上されている

研究

費

国内

総生

産（平

成13

年度を

100として指

数化）リーマンショック

R&D Funding Used by Field（All sectors including NPOs/Public Agencies, Universities, Businesses)

06/07/2016

Japan’s Potential for Growth （１）

06/07/201613OECD STI Scoreboard 2015

Top 10% most cited documents and scientific leading authorship, 2003-12 As a percentage of all documents, whole counts

Japan’s Potential for Growth （２）

06/07/201614OECD STI Scoreboard 2015

Female scientific authors in selected fields, by country, 2011 As a percentage of corresponding authors, estimated shares

Japan’s Potential for Growth （３）

06/07/201615OECD Innovation Imperative (2016)

Start-up rates have declined across countries Percentage of start-ups in all businesses

Fifth Science and Technology Basic Plan and Society 5.0

06/07/201616

Where we stand today• Consider the times

– Period of Great Change• Connectivity, Openness, Inclusiveness• Beyond existing frameworks ➡ Co-production, Co-creation,

Co-…• Data-driven innovation, Social innovation, Platform economy,

Shared economy, …➡ Unpredictable, Unforeseeable, Transformational, Disruptive• Global perspective

– Preparedness is the key• Keys for Science, Technology, and Innovation?

– Fundamentals– Social experiments＋learning– Creativity– Social acceptance of “difference”– Co-creation beyond existing frameworks

2016/07/0817

5th Science and Technology Basic Plan （2016-2020）

• Three Pillars– Lead this period of great change➡ Preparing the next: Future industry and society

• Proposed and implemented by various stakeholders, in particular young leaders of the next generation

– Preemptive action against economic and social issues➡ Addressing economic and social challenges

– Increase potential, which enables efforts to respond to uncertain changes➡ Development and enhancement of fundamentals

• People that act based on deep knowledge, observational skills, and leadership

• Continually create diverse, excellent knowledge assets• Initiatives

– More open and dynamic innovation systems– More inclusive innovation

06/07/201618

Preparing the next: Future industry and society

• Exploring game changers➡Places for debate, discovering ideas

• New approaches– System of Systems approach– (Global) Value Chains approach➡By promoting specific projects

• Investing in technologies that provide a common platform➡Enabling technologies (IoT, AI, Big Data, …)

• Society 5.006/07/201619

Society 5.0

06/07/201620

Hunting & GatheringIn symbiosis with Nature

AgricultureOrganization ➡

Nation states

IndustryMastering of power➡

Mass production

InformationIntangible assets + network➡

added value

Learn from History

1. Hunting & Gathering Society➡ Sustainability

2. Agricultural Society➡ Inclusiveness

3. Industrial Society➡ Efficiency

4. Information Society➡ Power of intellect

Society 5.0– Full use of STI– People as the core– Participation by all– Shared values

• Sustainability• Inclusiveness• Efficiency• Power of intellect

06/07/201621

In Other Words・・・• Super Smart Society

– A society where the necessary goods and services are provided to the people who need them at the right time and in the right amounts, regardless of age, gender, location, language or other limitations, for a fulfilling and comfortable lifestyle where everyone can receive high-quality service

• Coexistence of people and robots/AI• Made-to-order services• Elimination of service inequality• Increased opportunities for game changers

06/07/201622

Improvement of Fundamental Technologies

• Cyberspace– Cybersecurity– Software base– Big data analysis– Artificial intelligence– Devices to process

large-scale data at rapid speeds with low power consumption

– Networks

• Real World– Robotics and actuators– Sensors and

optical/quantum technology

– Biotechnology (biointerfaces, etc.)

– Human interfaces using augmented reality (AR) and haptic engineering

– Materials and nanotechnology

06/07/201623

Society 5.0 Platform

24

○Cybersecurity

Shared Base Functions

○System to Promote Use of Data○Linked Open Data System ○Unified Data Format

○Global IP Standards

○System/Regulation Reforms ○Training Human Resources

Base TechnologiesAI, Big Data Processing, etc. Image

DataImproved

DataExchange

PositionData

Database

3D MapData

GlobalEnvironment

Data

NewServices

EnergyValueChain

IntelligentTransportSystem

MonozukuriSystem

Smart Production

System

SmartFood Chain

System

IntegratedMaterial R&D

System

HospitalitySystem

RegionalInclusive Care

SystemInfrastructureMaintenance

System

DisasterReduction

SystemGlobalEnvironment

DataPlatform

2016/06/27

Comprehensive Strategy on STI 2016• Acting to Create New Value for the Development of Future

Industry and Social Transformation– Database construction– Promoting valuable uses of data– IP strategy and creation of global standards– System and regulation reforms, and fostering social acceptance– Skill development, training of human resources

• Enhancing Fundamentals of STI– Increasing human resource capabilities

• Training and opportunities for young researchers, opportunities for women, more flexible movement of human resources

– Funding reforms• Reforms for base costs, reforms for public funding, integrated reforms for

national universities and research funding• Creation of a Virtuous Cycle for Human Resources, Knowledge,

and Funding to Create Innovation– Improvement of systems to promote open innovation– Improve creation of SMEs and start-ups for new business areas

• Improve Capabilities for Promotion of STI06/07/201625

What’s next!• The Advisory Panel on Artificial Intelligence and Human

Society (May-)• Under Minister of State for Science and Technology Policy

– Ethics, law, regulations, economy, social impact➡issues and planned direction

• Committee for Promotion of Economic Society and Science, Technology and Innovation (June-)

• Under Council on Economic and Fiscal Policy and Council for Science, Technology and Innovation

– Fundamental system reforms (systems for training and exchange of human resources, employment conditions, funding distribution, accounting, etc.)

– Transparency and evidence for STI policies– STI ➡ Economic stimulus policies and increased annual

expenditure efficiency, etc.

06/07/201626