japan: promoting inclusive growth for an ageing society · japan : promoting inclusive growth for...

OECDOECD Economics

JAPAN : PROMOTING INCLUSIVE GROWTH FOR AN

AGEING SOCIETY

Research Institute of Economy, Trade and IndustryTokyo, 22 June 2018

Randall S. JonesHead of Japan/Korea Desk, OECD

• Japan’s economic outlook• Long-term challenges facing Japan• Achieving fiscal sustainability in the

context of an ageing and shrinking population

• Policies to increase productivity and encourage inclusive growth

2

Key messages on the economic outlook

• Global growth will be around 4%Investment and trade have rebounded

• Monetary and fiscal policies have been supportiveThree quarters of OECD countries are undertaking fiscal easing

• Job growth has been strongThe OECD unemployment rate will be at its lowest since 1980

• Risks loom large over the next few years: oil prices, trade tensions, financial volatilityRising interest rates will pose challenges for highly indebted countries, households and corporations.

• Now is the time to reform for sustainable and inclusive growthInvest in education, skills, digital infrastructure

3

Investment has rebounded

Contribution to investment growthOECD economies

Note: Gross fixed capital formation, in volume. Data are year-on-year growth rates. Projections for 2018 and 2019.Source: OECD Economic Outlook database; and OECD calculations. 4

-1

0

1

2

3

4

5

-1

0

1

2

3

4

5

2011 2012 2013 2014 2015 2016 2017 2018 2019

Business and public Residential OECD% pts % pts

Trade has recovered

Growth in global trade

Note: World trade is measured as goods and services trade volumes measured at market exchange rates in US dollars. Global Port Traffic is measured monthly through the RWI/ISL-Container-Throughput-Index, seasonally and working day adjusted. Projections for 2018 and 2019.Source: OECD Economic Outlook database; and RWI/ISL.

5

100

107

114

121

128

135

142

0

1

2

3

4

5

6

2012 2013 2014 2015 2016 2017 2018 2019

Index 2010 = 100% y-o-yGlobal trade growth (lhs) Global Port Traffic (rhs)

Note: The fiscal stance is calculated based on changes in the underlying primary balance as a percentage of potential GDP. Large fiscal easing is for a deterioration of the balance by more than 0.5% of potential GDP and small easing is for a deterioration by less than 0.5% of potential GDP. Large and small fiscal tightening are defined analogously. Chile, Mexico and Turkey are excluded due to the lack of data. Projections for 2018 and 2019. Source: OECD Economic Outlook database; and OECD calculations.

Change in fiscal stance in OECD countries

Fiscal policy is easing

0

4

8

12

16

20

24

28

32

0

4

8

12

16

20

24

28

32

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Large easing Small easing Small tightening Large tighteningNumber of countries Number of countries

6

Global stock market capitalisation

Source: World Federation of Exchanges; and OECD calculations.

Equity prices remain high despite a recent correction

40

50

60

70

80

90

40

50

60

70

80

90

2014 2015 2016 2017 2018

USD trillion USD trillion

7

Exports to other Asian countries have been strong despite a recent slowdown

8Source: Bank of Japan

Exports by region in volume terms

Capital investment by the business sector is gradually expanding in the context of high profits and rising capacity

shortages

9

Note: For capacity (firms reporting an excess minus those reporting a shortage), the value is reversed on the right axis. Facilities capacity and capital investment plans are for all industries excluding finance and insurance.

Source: Bank of Japan; Ministry of Finance.

Capital investment, profits and excess capacity Tankan survey of firms’ capital investment plans

The labour market continues to be tight

10Source: Ministry of Internal Affairs and Communications; Ministry of Health, Labor and Welfare.

While nominal wages are gradually rising, real wages have declined recently

11

Note: Three-month moving average of seasonally adjusted index for establishments with more than 30 employees. Real wages are calculated using the consumer price index excluding rent.（出典）厚生労働省

One factor limiting wage increases in the rapid rise in non-regular employment

12Source: Ministry of Internal Affairs and Communications.

Inflation remains well below the 2% target

13

Note: Excludes the effect of consumption tax rate increases in FY 2014 and FY 2019. Compared to the same period of the previous year. The core price index is the OECD definition, excluding food and energy prices. Shaded part is a projection.

Source: OECD Economic Outlook: Statistics and Projections (database); Ministry of Internal Affairs and Communications

1. Contribution to real GDP change rate.. 2. It is calculated from the total of the seasonally adjusted quarterly value of each year. 3. Consumer price index excluding food and energy prices. Source: OECD Economic Outlook, May 2018.

14

OECD projections for the Japanese economy

Global demand-supply balance and oil prices

Oil prices have risen significantly

Note: The global demand-supply balance measures the difference between global supply and global demand, both indexed to 100 in 2012Q3, 4 quarter moving average. Oil price refers to crude oil Brent price. The last point for oil prices is the last available daily value, as of 28 May 2018.Source: International Energy Agency; Thomson Reuters; and OECD calculations. 15

0

20

40

60

80

100

-1.5

-1.0

-0.5

0.0

0.5

1.0

2015 2016 2017 2018

Global demand minus supply (lhs) Oil price (rhs)USD per barrelIndex

Demand < supplyDownward pressure on prices

Demand > supplyUpward pressure on prices

A negative shock to trade would be more harmful than in the past

Global exports and imports

Note: Trade is the average of exports and imports in a given year. Both trade and GDP are measured in volumes in US dollars at market exchange rates.Source: OECD Economic Outlook database; and OECD calculations. 16

0

5

10

15

20

25

30

35

0

5

10

15

20

25

30

35

1990 1993 1996 1999 2002 2005 2008 2011 2014 2017

Advanced economies Emerging market economies% of global GDP % of global GDP

Reduce trade barriers to boost productivity and incomes

Note: Scenario in which tariffs are reduced by all G20 economies to the lowest level applied across them for each sector.Source: OECD METRO model simulations.

0

1

2

3

4

5

6

7

8

0

1

2

3

4

5

6

7

8

World United States European Union China

%%Imports Exports

Increase in trade from multilateral tariff reductions Estimated medium-term impact of lowering tariffs in all G20 economies

17




18

Japan's well-being record is mixed

19Source: OECD (2017a), How’s Life? 2017: Measuring Well-being, OECD Publishing, Paris, http://dx.doi.org/10.1787/how_life-2017-en.

Japan's per capita output growth has picked up

20

Source: OECD Economic Outlook: Statistics and Projections (database).

Per capita output growth (%), Japan and OECD average

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1990-2012 2012-2017

Japan OECD

Per capita output and labour productivity remain well below the top half of OECD countries

21

Note: Compared to the weighted average using population weights of the 17 OECD countries with highest GDP per capita in 2016, based on 2016 purchasing power parities (PPPs). The sum of the percentage difference in labour resource utilisation and labour productivity do not add up exactly to the GDP per capita difference, since the decomposition is multiplicative.Source: OECD (2018), OECD Economic Outlook: Statistics and Projections (database).

60

70

80

90

100

110

120

130

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Per capita income Labour productivity Labour inputs

Per capita income, labour productivity and labour inputs relative to top half of OECD (=100)

Productivity of small firms is low relative to large firms in Japan

22

Source: OECD (2016b), Entrepreneurship at a Glance, OECD Publishing, Paris, http://dx.doi.org/10.1787/entrepreneur_aag-2016-en.

0

10

20

30

40

50

60

70

80

90

100

IRL

HUN

TUR

ISR

MEX

JPN

GRC

CHE

CZE

USA

DNK

PRT

GBR

BEL

DEU

OECD PO

L

NLD

SVK

SWE

ESP

AUT

LVA

AUS

NOR ITA

SVN

FRA

FIN

EST

Value added per person employed in 2013 in firms with 10-49 workers relative to that in firms with more than 250 workers (firms with more than 250 workers = 100)

Small firms in Japan are old, suggesting a lack of economic dynamism

23

Source: Criscuolo et al. (2014).

Japan's population will remain the oldest in the OECD through 2050

24

0

10

20

30

40

50

60

70

80

MEX

TUR

CHL

KOR

ISR

SVK

IRL

LUX ISL

NZL

AUS

USA

POL

CAN

NOR

OECD CH

EHU

NCZ

ESV

NAU

TNL

DGB

RBE

LES

PES

TDN

KFR

ALV

ASW

EPR

TFI

NDE

UGR

C ITA

JPN

2015 2050

Population aged 65 and over as a percentage of the population aged 15-64

Source: OECD Demography and Population (database).

Japan faces a shrinking and ageing population

25

Source: OECD Demography and Population Statistics (database).

1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 20500

20

40

60

80

100

120

140 Millions

0

20

40

60

80

100

120

140Millions

Over 65 years

15-64 years (working-age population)

0-14 years

The wage gap between regular and non-regular workers is large

26

1. In June 2015, excluding overtime payments and bonuses.Source: Ministry of Health, Labour, and Welfare "Basic Survey on Wage Structure 2015".

0

20

40

60

80

100

120

140 Per cent

0

20

40

60

80

100

120

140Per cent

20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69Age group

RegularNon-regular

Wage as a percentage of the average wage of regular employees1




27

Japan’s fiscal situation has deteriorated considerably over the past 25 years

28

Note: OECD projections for 2016-17 for Japan and 2017 only for Greece.Source: OECD Economic Outlook: Statistics and Projections (database).

0

50

100

150

200

250

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Japan United StatesGreece OECD

Gross government debt as a percentage of GDP

Government projections show that the FY 2020 target for a primary surplus is out of reach

29

Note: January 2018 projections.Source: Cabinet Office of Japan (2018), Economic and Fiscal Projections for Medium to Long Term Analysis, Provisional Translation, Cabinet Office, Tokyo, http://www5.cao.go.jp/keizai3/econome/h30eiyaku1.pdf.

-4.0

-3.5

-3.0

-2.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Baseline (2% annual growth rate) High growth (more than 3% annual growth rate)

Primary balance (central and local governments) as a percentage of GDP on a fiscal year basis

Japan’s tax revenue tends to rely relatively more on direct taxes

30

Note: In the OECD approach, revenue sources include social security contributions. Source: OECD Revenue Statistics Database.

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

Taxes on property Taxes on corporate income Taxes on personal income Consumption taxes (includingVAT)

Social security contributionsand payroll taxes

Japan OECD

Structure of total tax revenues in Japan and the OECD in 2015

Japan has the third-lowest standard VAT rate in the OECD

31

Source: OECD Tax (database).

0

5

10

15

20

25

30

CAN

CHE

JPN

AUS

KOR

NZL

MEX

ISR

LUX

TUR

CHL

DEU

AUT

EST

FRA

SVK

GBR

BEL

CZE

LVA

NLD

ESP

ITA

SVN IRL

POL

PRT

FIN

GRC ISL

DNK

NOR

SWE

HUN

2018 2008

Standard VAT rates in the OECD in % in 2008 and 2018

Health and long-term care expenditures have risen rapidly in the last decade

32

Health and long-term care expenditures in Japan, % of GDP

Source: OECD Health Statistics 2017.

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Health spending (excluding LTC)Inpatient LTCDay LTCHome-based LTCLTC Social

Japan’s healthcare expenditure as a share of GDP is among the highest in the OECD

Healthcare expenditure as a share of GDP, 2016 (or nearest year)

33

Note: Healthcare expenditure includes health-related LTC spending and excludes investments. Australian expenditure estimates exclude all expenditure for residential aged-care facilities in welfare (social) services. Source: OECD Health Statistics 2017 for OECD countries, World Health Organization Global Health Expenditure Database for non-OECD countries.

0

2

4

6

8

10

12

14

16

18

USA

CHE

DEU

SWE

FRA

JPN

CAN

NLD

NOR

BEL

DNK

AUT

GBR

AUS

FIN

NZL

CRI

OECD ES

PPR

TIT

AZA

FIS

LSV

NCH

LGR

C IRL

KOR

HUN

ISR

CZE

COL

SVK

EST

LTU

POL

LUX

BRA

MEX

LVA

RUS

CHN

IND

TUR

IDN

Government/Compulsory Voluntary/Out-of-pocket

34

1. In days.2. Per 1 000 population.3. In hospitals.Source: OECD (2017f), OECD Health Statistics (database).

In 2014 or latest year available

Number of doctor

consultations per capita per

year

Share of private

expenditure on

outpatient care (%)

Average total

hospital stay1

Average hospital stay for

acute care1

Total number of hospital

beds2

Number of acute-

care beds2,3

Number of long-

term care beds2,3

Number of beds in

long-term care

facilities2

Japan 12.8 17.1 29.9 16.9 13.2 7.9 2.7 6.2

OECD average 6.8 33.3 8.3 6.4 4.7 3.6 0.6 7.3

Highest country 14.9 54.9 29.9 16.9 13.2 7.9 4.2 12.8

Lowest country 2.6 13.3 4.0 3.5 1.6 1.6 0.0 0.5

International comparisons show room for healthcare cost savings in Japan

Elderly-related social spending is projected to rise further

35

Note: Fiscal System Council estimates based on the current framework, following the method of the European Commission (2012)Ageing-related spending is defined as programmes where per capita expenditure differs by age, such as pensions.1. Public pension spending is based on the actuarial valuation by the Ministry of Health, Labor and Welfare (2014), Case C.2. Medical assistance in the Basic Livelihood Protection Program is included in “medical insurance”.3. The population over age 65 as a share of the total population.Source: Fiscal System Council (2015).

2020 2025 2030 2035 2040 2045 2050 2055 20600

10

20

30

40

50 Per cent of GDP

0

10

20

30

40

50Per cent of population

Medical insurance² (left scale)Long-term care insurance (left scale)Public pension¹ (left scale) Share of the elderly³ (right scale)

1. Commit to a more detailed medium-term fiscal consolidation path with specific spending cuts and tax increases to strengthen confidence in Japan's fiscal sustainability

2. Gradually raise the consumption tax rate.

3. Enhance equity by introducing an earned income tax credit.

4. Fully apply macroeconomic indexation as soon as possible.

5. Raise the pension eligibility age above 65.

6. Take long-term care out of hospitals and reduce long-term care insurance coverage for those with less severe needs and increase the use of generic drugs.

36

Key recommendations to ensure fiscal sustainability




37

Women are under-represented in management positions

38

Women’s share of management employment and female share of labour force, all ages, 2015 or latest available year (%)

Note: For Canada, Chile and the United States, the women’s share of managerial employment is for jobs classified in International Standard Classification of Occupations (ISCO) 88 category 1 (as legislators, senior officials and managers). For all other countries, the women’s share of managerial employment is for jobs classified in ISCO 08 category 1 (as managers). All data are for 2015, except for the United States (2013) and Australia and Canada (both 2014).Source: Based on OECD (2017g) The Pursuit of Gender Equality: An Uphill Battle, OECD Publishing, Paris, Figure 11.3, http://dx.doi.org/10.1787/9789264281318-en.

0

10

20

30

40

50

60

LVA

USA

HUN

POL

SWE ISL

SVN

AUS

NOR

CAN

GBR

CHE

MEX

IRL

FIN

PRT

BEL

ISR

FRA

ESP

SVK OE

…ES

TAU

TCZ

EDE

UDN

KIT

ANL

DGR

CCH

LLU

XTU

RJP

NKO

R

Women's share of managerial employment (↘) Women's share of the labour force

Japan is one of the most robot-intensive economies in the world

Industrial robot stock over manufacturing value added, millions USD, 2005 and 2015

39

Note: OECD calculations based on International Federation of Robotics data and the World Bank, Word Development Indicators Database, September 2017.Source: OECD (2017c), OECD Science, Technology and Industry Scoreboard 2017: The digital transformation, OECD Publishing, Paris. http://dx.doi.org/10.1787/888933617377.

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

KOR

JPN

DEU

CZE

SVN

SVK

ITA

HUN

OECD ES

P

EU28

SWE

USA

2015 2005

0.00

0.01

0.02

0.03

0.04

0.05

CHN

ZAF

BRA

IND

RUS

International collaboration in science and innovation is relatively low

40

Co-authorship and co-invention as a percentage of scientific publications and IP5 patent families, 2005-16

Note: The median is calculated across OECD countries plus non-members (Brazil, China, Indonesia, India, Russian Federation and South Africa).Source: OECD calculations based on Scopus Custom Data, Elsevier, Version 4, 2017 and OECD, STI Micro-data Lab: Intellectual Property Database, http://oe.cd/ipstats, July 2017. See OECD (2017c), OECD Science, Technology and Industry Scoreboard 2017: The Digital Transformation, OECD Publishing, Paris, http://dx.doi.org/10.1787/9789264268821-en.

AUS

AUT

BEL

CAN

CHL

CZE

DNK

EST

FINFRADEU

GRC

HUN

ISL

IRL

ISR

ITA

JPNKOR

LVA

LUX

MEX

NLDNZL

NOR

POLPRT

SVK

SVN

ESP SWE

CHE

TUR

GBR

USA

BRA

CHN

IDN

INDRUS

ZAF

0

10

20

30

40

50

0.0 25.0 50.0 75.0

OECD countries BRIICS

Inter

natio

nal c

o-inv

entio

ns (

%)

International co-authorship (%)Me

dian v

alue

Median value

41

Venture capital investments are low in Japan compared to other OECD countries

Note: For Israel and Japan, data are for 2014.Source: OECD (2018b), Financing SMEs and Entrepreneurs 2018: An OECD Scoreboard, OECD Publishing, Paris http://dx.doi.org/10.1787/fin_sme_ent-2018-en.

Venture capital investments as a percentage of GDP, 2016

0.00

0.01

0.02

0.03

0.04

0.05

0.06

0.07

0.08

0.09

0.10

KOR IRL

FIN

ZAF

SWE

CHE

FRA

ESP

NZL

LVA

EST

DNK

GBR

BEL

NOR

HUN

NLD

JPN

AUT

AUS

SVK

PRT

SVN ITA

POL

RUS

CZE

LUX

GRC

Seed/start-up/early stage Later stage venture Total

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

ISR

USA

CAN

The share of entrepreneurs in Japan is low, especially among women

Source: OECD (2016), Entrepreneurship at a Glance.

42

0

1

2

3

4

5

6

7

8

9 Per cent

NO

RJ

PN

ISR

US

AT

UR

ES

TG

BR

ISL

LU

XA

US

DN

KS

WE

CZ

ES

VK

FIN

SV

NF

RA

NL

DM

EX

IRL

OE

CD

LV

AB

EL

AU

TD

EU

ZA

FC

AN

BR

AP

OL

NZ

LH

UN

PR

TC

HE

KO

RE

SP

CH

LIT

AG

RC

A. Women

0

1

2

3

4

5

6

7

8

9Per cent

AU

SN

OR

JP

NL

UX

GB

RU

SA

SV

KS

VN

CZ

EB

RA

DN

KN

ZL

PO

LS

WE

ME

XE

ST

LV

AB

EL

NL

DO

EC

DIS

LT

UR

DE

UF

RA

FIN

ES

PIR

LC

AN

AU

TH

UN

PR

TC

HL

ISR

CH

EG

RC

KO

RZ

AF

ITA

B. Men

Promote second chances for failed entrepreneurs by making the personal bankruptcy system less stringent.

Views on entrepreneurship in Japan are negative

1. Share of adults who perceive good opportunities to start a business.2. Share of adults who are not involved in entrepreneurial activity and expect to start a business within three years.Source: Global Entrepreneurship Monitor (2015).

43

0

10

20

30

40

50

60 Per cent

0

10

20

30

40

50

60Per cent

Perceived opportunities¹ Perceived capabilities Fear of failure Entrepreneurial intention²

JapanOECD average

Barriers to trade and investment are high in Japan

44

Barriers to trade and investment indicator, 2013

Note: The OECD Indicators of Product Market Regulation (PMR) are a comprehensive and internationally-comparable set of indicators that measure the degree to which policies promote or inhibit competition. Empirical research shows that the indicators have a robust link to performance. The indicator, which ranges from 0 (most relaxed) to 3 (most stringent), is available for 35 OECD countries. The overall indicator is based on more than 700 questions.Source: OECD PMR Database.

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

NLD

BEL

AUS

FIN

GBR

LUX

HUN

POL

IRL

CHE

FRA

PRT

DEU

ESP

CZE

ITA

CHL

DNK ISL

GRC

USA

NZL

OECD SV

KNO

RAU

TSW

EES

TJP

NLV

ASV

NCA

NIS

RTU

RKO

RME

X

Japan has room to further reduce barriers to trade in services

OECD Services Trade Restrictive Index 2017, from 0 (least restrictive) to 1 (most restrictive)

45Source: OECD Services Trade Restrictiveness Index, http://www.oecd.org/tad/services-trade/services-trade-restrictiveness-index.htm.

0.0

0.1

0.2

0.3

0.4

0.5

0.6

Comp

uter s

ervic

es

Telec

ommu

nicati

on

Broa

dcas

ting

Motio

n pict

ures

Soun

d rec

ordin

g

Air t

rans

port

Mariti

me tr

ansp

ort

Road

freig

ht tra

nspo

rt

Rail f

reigh

t tran

spor

t

Cour

ier se

rvice

s

Distr

ibutio

n ser

vices

Carg

o-ha

ndlin

g

Stor

age a

nd w

areh

ouse

Freig

ht for

ward

ing

Custo

ms br

oker

age

Lega

l ser

vices

Acco

untin

g ser

vices

Comm

ercia

l ban

king

Insur

ance

Cons

tructi

on

Arch

itectu

re se

rvice

s

Engin

eerin

g ser

vices

Digital network Transport and distribution supply chain Market bridging and supportingservices

Physical infrastructureservices

Restrictions on foreign entry Restrictions to movement of peopleOther discriminatory measures Barriers to competitionRegulatory transparency Best practice

Japan has a low level of FDI stocks

46

Inward and outward stocks of direct investment as a percentage of GDP, 2016

Note: Inward/outward FDI not represented: Belgium (102/122), Ireland (276/276), Luxembourg (351/353), the Netherlands (107/180) and Switzerland (130/165).Source: OECD (2018), FDI stocks (indicator), http://dx.doi.org/10.1787/80eca1f9-en.

AUSAUT

CAN

CHL

CZE

DNK

EST

FIN

FRADEU

GRC

HUN

ISL

ISR

ITA

JPN

KOR

LVAMEX

NZL NORPOL

PRTSVK

SVN

ESP

SWE

TUR

GBR

USA OECD

0

10

20

30

40

50

60

70

80

90

100

0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100

Inwar

d in p

erce

ntage

of G

DP

Outward in percentage of GDP

Foreign-owned enterprises in Japan have low export intensity

Export intensity of foreign-owned enterprises

47

Source: OECD (2017j), Japan: Trade and Investment Statistical Note, OECD Publishing, Paris, http://www.oecd.org/investment/JAPAN-trade-investment-statistical-country-note.pdf.

0%

5%

10%

15%

20%

25%

Japan OECD medianExport Intensity

Government credit guarantees to SMEs are high

48

Stock of guarantees as a share of GDP in 2015

Source: Financing SMEs and Entrepreneurs 2017: An OECD Scorecard .

.

0

1

2

3

4

5

6

7

8

9

Per cent of GDP

0

1

2

3

4

5

6

7

8

9

Per cent of GDP

GBR MEX DNK CAN AUT TUR SVK NLD BEL CZEOECDUSA RUS ISR EST FIN FRA ITA ESP HUN KOR JPN GRC

49

Carbon intensity of Japan’s energy mix jumped after 2011 and remains high

Note: The IEA Energy Sector Carbon Intensity Index tracks how many tonnes of carbon dioxide are emitted for each unit of energy supplied (total primary energy supply).Source: IEA (2018), "Indicators for CO2 emissions", IEA CO2 Emissions from Fuel Combustion Statistics (database), http://dx.doi.org/10.1787/data-00433-en.

Energy sector carbon intensity, 1990=100

80

85

90

95

100

105

110

115

12019

90

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Japan OECD

Key recommendations to boost productivity for inclusive growth

1. Remove obstacles to female employment by increasing the capacity of childcare and improving work-life balance through a binding ceiling on overtime work.

2. Increase the productivity of SMEs by strengthening R&D links between firms and universities.

3. Facilitate the exit of non-viable firms by reducing the use of personal guarantees.

4. Promote second chances for failed entrepreneurs by making the personal bankruptcy system less stringent.

5. Implement the planned reform of the Credit Guarantee System to strengthen market forces and keep public guarantees of SME loans on a downward trend.

6. Break down dualism by relaxing employment protection for regular workers and expanding social insurance coverage and training for non-regular workers. 50

More information…

www.oecd.org/eco/surveys/economic-survey-japan.htm

OECDOECD Economics

Disclaimers: The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law.This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area.

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