In June, the Japanese Government made headlines proposing a four-day workweek. This came as a surprise for sure, as Japan is known for a corporate culture with a focus on time spent at work, rather than results.

The Cabinet officially announced the recommendation earlier in June, as part of the annual economical policy guidelines. The plans include ideas to “push” employers towards a four-day workweek. This is, however a “recommendation” that companies can feel free to choose whether to embrace or not.

Politicians hope to persuade company leaders that more flexible working hours and remote working can remain in place at the end of the covid19 crisis. One of the backgrounds of the initiative is to tackle Japan’s labor shortage and to keep the unemployment level low. The idea is that a four-day workweek will improve the work-life balance and enable:

• More time to take care of family members
• Further education, such as learning new IT skills.
• More time to take on a side hustle

On the other hand, workers and company leaders voice concerns regarding possible negative outcomes, such as salary reductions, or lower overall output due to less working time.

Microsoft in Japan has already tried this in 2019. Where staff worked in August for a four-day workweek, receiving their normal five-day salary. All staff was given a special paid leave. According to the company, the worker’s productivity exploded by +40%!

Except for Japan, many other countries have also similar ideas. Spain is launching a three-year similar project, with a voluntary 32-hour workweek experiment. Sweden had a two-year trial at a hospital with six-hour days, five days a week, with staff maintaining full salary. The project was not cheap, as more staff was brought in to cover the lost hours. On the other than, the project resulted in less sick leave, improved health, and higher productivity!

Japan’s well-known lack of space has opened the door for agritech and indoor farms. Agritech or Agricultural technology is the use of technology in agriculture with the aim to boost yield, efficiency, and profitability.

Agritech is mainly being used for conventional farming. However, for several years, indoor farming has also become increasingly popular. Especially in the case of Japan, where incentives are high to produce as much as possible per cubic meter.

In Japan, the train operator giant JR east is looking into the indoor farm business. They have invested in German startup Infarm, which has developed new indoor farm technology. Each “Infarm” has a controlled ecosystem with sensors that collect data on temperature, humidity, water level. The data are then sent to a cloud, where an AI program then controls the equipment remotely and makes sure conditions are optimal. Thus, reassuring optimal circumstances for growth.

JR East is looking to utilize its shopping complexes inside the actual train stations for indoor farming! Kinokuniya, a JR East supermarket subsidiary, has also built small indoor farms inside some of their stores.

*Like Tesla, we constantly update the software to improve cultivation efficiency” said Okuo Hiraishi, managing director of Infarm Japan.

Infarm has also partnered with Summit, a Japanese grocery store, to grow veggies using grow lights and sell on-site directly. Since the beginning of the year, a Summit store in Tokyo’s Adachi ward has grown lettuce and other vegetables inside the store premises.

Japan also houses the award-winning Spread, which is one of the worlds leading vertical farms. Its Keihanna Techno Farm in Kyoto is now achieving a stable production of 30.000 Lettuce heads/3 tons/day. The vegetables from Spread are protected from disease and dirt in a sealed room.

Another Agritech startup Farmship aims to supply a steady food supply system in Japan with AI technology. They are building what will be one of Japan’s largest vegetable factories.

Indoor farms have struggled with profitability due to high electricity and advanced tech. Factory-grown vegetables are chemical and pesticide-free but also more expensive than traditionally grown vegetables. Not being sensitive to Japan’s changing weather patterns, with more stable operational costs, the future looks bright for indoor farms.

“Agritech” market, $9 billion dollars in 2020, is expected to grow to over $22 billion in 2025 according to Juniper Research.

Did you know that Japan is the world’s No.1 when it comes to battery-related patents? There are already more than 2300 patents in this field! In 2019, Akira Yoshino was awarded the Nobel Prize for chemistry. Many of the portable electric devices we are using today are based on the prototype battery he developed. Read more about business in Japan here.

“The world’s highest-capacity” solid-state battery is being developed in Japan. Hitachi Zosen has created a solid-state lithium-ion battery with one of the world’s highest capacities. These types are safer and more efficient than current liquid electrolyte batteries. They can also operate between -40℃ and 100℃ and is a candidate for use in extreme environments, for example in satellites.

There are also startups in Japan racing to create a new global standard for high-performing batteries. AC Biode, a startup in Kyoto, is developing the world’s first standalone AC batteries. “Biode” is a new word minted by the company and has the characteristics of both an anode and a cathode. The company claims the AC battery is safer and about 30% smaller than a regular DC (Direct current) battery.

Japan’s Panasonic, has today a ~20% share of the automotive battery market. One of the strategies is to create cobalt-free batteries until 2023 to avoid sourcing issues. The electronics giant is also partnering with Tesla, one of the world’s best-selling electric car makers.

About ten years ago, Nissan became the first car maker to series produces a “Leaf”. Which run on batteries alone. and have sold over 500,000 vehicles.

Mitsubishi Fuso has also a small series production of the eCanter, an electric light-duty truck. The traction battery consists of six high-voltage lithium-ion battery packs with 420 V and 13.8 kWh each.

In recent years, cryptocurrency has been rising as a global phenomenon. This is also true in the case of Japan.

In April 2020, Japan’s Financial Services Agency(FSA) officially certified two cryptocurrency related organizations. Japan security token association (JSTA) and Japan Virtual Currency Exchange Business Association (JVCEA). Softbank Corps has confirmed joining JSTA, which also contains other large group companies such as Mitsui Trust and NTT Data as members. Not only large IT companies, but also crypto and blockchain member firms such as TokenSoft or Bitflyer (Japan’s largest cryptocurrency trading service) are also members.

A major player in Japan’s financial sector, JCB also recently announced that it would be working on a crypto-related project. The credit card giant said it has begun working with Cowry, a Tokyo-based payment, and blockchain startup. Together they will begin a demo experiment involving financial solutions.

The idea is to make use of existing cryptocurrencies and other block-chain networks on Cowrys block-chain platform. JCB and Cowrly said they have a technological solution that will allow their product to settle payments instantly by confirming a new transaction. This compared to the normal case, which is waiting for blocks to be mined. Another Japanese IT Giant Fujitsu is also joining the pilot project.

“From Super Mario to Pokémon and Final Fantasy, Japan is home to pioneering games that hold a lasting place in pop culture… We believe some of the world’s best blockchain games will come from the Japanese gaming industry, and we will be there to help them leverage this powerful technology to the fullest.”, said Enjin’s CEO Maxim Blagov.

The crypto Enjin Coin (ENJ), has gone through the Japan regulatory to become the first gaming cryptocurrency to pass by JVCEA. Crypto projects must pass through a “rigorous process” as Enjin did according to Seihaku Yoshida, Hashport’s CEO. The same company provided support to Enjin with their Accelerator, provided additional details on the approval process.

As Hong Kong faces an exodus of finance professionals, the Japanese government has developed a new strategy to turn the country into a large scale financial hub in Asia. New policy measures, such as tax breaks and more relaxed visa rules are now on their way to attract financial talents.

You can find the full column here at business-japan.jp. 

In Japan today, up to 55% inheritance tax is levied on domestic and foreign assets if a foreigner lives in Japan or has left Japan for less than 10 years. However, the 2018 tax reform introduced new measures to exclude workers with highly professional visas from inheritance tax.

In addition, the 2021 tax reform plans to expand the scope of total profit and loss related to financial products in order to make it easier for investors to invest in various financial products.

Also, changes to the visa system are underway. Workers with highly professional visas are granted five-year visas and have a shorter path to permanent residency.

Background to new tax-reliefs are that many financial professionals from overseas leave Japan after 10 years, partly due to today’s tax system. The message from Japan government is to want foreign professionals to live and work longer in Japan.