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Sep 27 / 2016
PM's Cabinet Office

Action 85. Regenerate Regions through Industry, Tourism, Service, and Agriculture – Consider the Case of “Namennayo, Ibaraki-ken”

In a ranking of Japan’s most attractive prefectures, the “Ibaraki Prefecture” brand came last. The prefecture’s slogan was “Namennayo, Ibaraki-ken” (Don’t mess with Ibaraki prefecture). In fact, though, Ibaraki boasts the sixth highest incomes in the country, the highest average home floor area, and the second highest agricultural output. And as for attracting companies, it is number-one in Japan in three categories: number and floor area of factories and number of companies from outside the prefecture. So though provincial, it’s a prosperous prefecture. This “Namennayo, Ibaraki-ken,” which is the writer’s home prefecture and has the lowest brand value in the country, can provide some hints concerning regional economic revitalization.

1. Industry: Step up the establishment of industrial clusters centered on universities, research institutes, and private-sector companies
Ibaraki prefecture contains a number of industrial clusters. These are Tsukuba, which is centered on the National Institute of Advanced Industrial Science and Technology and Tsukuba University; Tokaimura, which mainly comprises nuclear-power-related facilities; Hitachi, which is a center for the electronics industry and related small and medium enterprises (SMEs); and Kashima, which is the site of petrochemical and steel plants. To grow regional economies, it is essential to utilize the intellectual resources that are already concentrated in each area and strengthen alliances between industry, local governments, and national governments. The keys are things like commitment from the national government and transportation infrastructure.
2. Tourism: Utilize private-sector knowledge, improve access, and take full advantage of tourism resources in each area
The fact that Ibaraki Airport got into the black so soon after it was opened is testament to the success of the government’s provision of hard infrastructure. In the town of Oarai, the municipal government has collaborated with the anime series Girls und Panzer, which is set in Oarai, organized events involving J-League teams, and so on. These initiatives, which have attracted large numbers of young people, were the ideas of a young entrepreneur who volunteered to make them a reality. In both hard and soft infrastructure, collaboration between government and the private sector, and the demarcation of roles between them, is vital.
Apparently, the loss of annual consumption caused by the departure of one permanent resident can be made up for by 24 tourists staying for a single night or seven tourists from overseas. Each region therefore needs to leverage its own distinctive appeal and give full play to its tourism resources.
3. Agriculture: Liberalize entry into the sector, increase the size of farms, and deregulate distribution
Ibaraki prefecture ranks number two in Japan, after Hokkaido, for the value of its farm output. The prefecture has exploited geographical advantages that include proximity to the huge market of Tokyo, logistical arteries such as the Joban Expressway, and location on the vast Kanto Plain, where high-value-added crops can be produced.
Ibaraki prefecture has been the first in the country to implement a farmland regeneration program that involves the liberalization of entry into the sector and increasing the size and efficiency of farms. And in the area of distribution, it has started providing assistance with exporting overseas in conjunction with JETRO’s Ibaraki office, which opened recently. It is no mistake to say that turning agriculture, which is the main industry in many regions, into a growth sector is the key to regional regeneration. Policies such as these are essential: (1) liberalization of entry, (2) larger and more efficient farms, and (3) deregulation of distribution.
4. Service industry: Enhance productivity through the formation of compact cities; further develop managerial personnel
To revitalize regional economies, it will be essential to make the service sector, which accounts for around 70% of Japan’s GDP, more competitive. The keys to this will be to enhance productivity and achieve renewal through the formation of compact cities and to develop managerial personnel. Many of the executives supporting regional economies are the second- or third-generation operators of family businesses. After the Tohoku earthquake, GLOBIS opened the Sendai Campus and began training local leaders who can spearhead reconstruction. When you meet such people, you notice that they haven’t had the opportunity to study management until now. The number of young executives with a strong desire to study management is surprisingly high, and that attitude is an asset to their regions. Since 2016, the writer has been implementing the Central Mito Revitalization Project in conjunction with the city of Mito. Local entrepreneurs should be able to contribute to their hometowns. When executives study, they transform their businesses, broaden their horizons, and strengthen the local economy.

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