The representative director of the New Economic Alliance, Hiroshi Mikitani (Rakuten), announced his New Year's message on the 1st, expressing a sense of crisis regarding the declining international presence of the Japanese economy. The alliance has clarified its policy to aim for fundamental transformation of the economic structure through policy proposals centered on regulatory reform and tax system review.
In 2025, the New Economic Alliance expanded its activities with a focus on policy proposal activities and member exchanges. The anniversary event 'JX Live!2025' held in October saw over 550 participants, the highest number ever, indicating a growing momentum for change in Japan. In January of the same year, the DE&I community was launched, providing a forum for discussions on the utilization of diverse human resources.
The decline of Japan's economic international standing has become clear.
The Japanese economy is facing structural challenges. According to IMF statistics, it recorded the only negative nominal GDP growth rate among G7 countries over the past 20 years. By 2026, it is expected to be surpassed by India in nominal GDP, falling to 5th place in the world. This is a decline in rank that occurs just two years after being overtaken by Germany in 2023 to become 4th.
Economic analysts point out not only the impact of the weak yen but also the decline in real growth potential. It is predicted that by 2030, Japan will fall to 9th place even in GDP based on purchasing power parity, indicating that a more serious economic stagnation is progressing beyond exchange rate fluctuations.
"Policies for a turnaround" are being proposed.
The New Economic Federation is presenting concrete reform proposals as "policies for a turnaround" to break this situation. First, in terms of regulation, it calls for the prompt review of existing regulations that hinder the social implementation of new technologies such as digital utilization, AI, and blockchain. There is a recognition that excessive regulation is a barrier to innovation.
In terms of taxation, it proposes lowering the highest tax rates for income tax, corporate tax, and inheritance tax. The aim is to prevent the outflow of human resources and capital while attracting investment from both domestic and foreign sources to achieve a "virtuous cycle of tax and growth." The tax reform proposals for the fiscal year 2026 presented a model of a virtuous cycle of economic revitalization and increased tax revenue through tax rate reductions.
As a human resource strategy, it advocates for the strategic utilization of international talent based on strict residency management. Furthermore, it encourages a shift from 'work style reform' centered on labor time management to 'work engagement reform' that emphasizes worker autonomy and expanded choices. The improvement of productivity through the utilization of AI is also positioned as a key policy measure.
The Federation is an economic organization with participation from a wide range of industries, including construction and manufacturing, centered around IT companies such as Rakuten Group and CyberAgent. More than half of the approximately 50 directors and secretaries are founders, and they are engaged in policy proposals that emphasize an entrepreneurial spirit. The representative director, Mr. Mikitani, emphasized the need to create an environment where the private sector can maximize its potential and showed a commitment to continuing dialogue with the government.