Japan to offer more growth opportunities for startups

This is part of the government’s innovation drive, according to a draft growth strategy by a Cabinet task force.

The task force, discussing how to realise a new form of capitalism – a concept advocated by Prime Minister Fumio Kishida for fairer wealth distribution, will consider 14 measures, including expanding investments to venture capital firms such as through state-owned Japan Investment Corp, according to the draft.

It will also consider a way of utilising the Government Pension Investment Fund. In 2021, the government invested about 800 billion yen (US$6.2 billion) to promote emerging companies.

The plan of boosting investments in startups is one of the four key pillars of intensive investment in overall strategy to realise the new capitalism concept with the other focal areas being human resources, science, technology and innovation, and green and digital technology.

Unlike the Kishida administration’s promotion of aggressive wage hikes, the draft strategy stipulates that the government will compile by the end of 2022 a plan to prompt more individuals to shift their money to investments from savings to double the household asset incomes.

More than half of the Japanese household assets are cash and deposits. The envisaged plan includes considering a “drastic revision” of a small-lot, tax-advantaged investment programme known as the Nippon Individual Savings Account (NISA). 

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Other key measures in the four fields include plans such as requiring companies to disclose gender pay gaps as well as the government issuing so-called transition bonds, which are typically used to fund environment-related projects, according to Kyodo News.