Unit 04 Kick-off Paper: Issues facing Japan’s Tourism Strategy towards 2020 and Considerations regarding the Easing of Tourism-related Regulations to Stimulate Regional Revitalization
―Orientations for the Promotion of Tourism and the Revitalization of Regional Areas
as Japan seeks to Attract 30 Million Foreign Tourists per Year―
the Faculty of Tourism and Community Studies, Atomi University
In 2013, the Japanese government realized its much-desired goal of achieving a figure of 10 million foreign visitors to Japan (inbound tourists). 19.73 million visitors were recorded in fiscal 2015, and it appears that the 20 million mark will be broken in 2016. The total amount of spending in Japan by foreign tourists also displayed a sharp increase to 3.4771 trillion yen in 2015, the highest-ever figure and the first time that the amount had exceeded three trillion yen in a year. This represented a 71.5% increase against the figure of 2.278 trillion yen for the previous year. Positioning tourism as part of its strategy for regional revitalization and economic growth, the government has now announced a new goal, raising its target for the annual number of foreign visitors to Japan to 30 million. However, the easing of existing tourism-related regulations and innovation in Japan’s readiness to accept foreign tourists, looking towards increasing the depth of tourism in the nation, will be essential for a tourism strategy which seeks to compete with other countries around the world. This kick-off paper will provide an overview of relevant issues and present certain proposals. For the papers in this edition of SPACE NIRA themselves, we have requested experts on the concept of Japanese-style DMOs, which will offer a foundation to boost regional revitalization and tourism in Japan to a new level, and on the issue of minpaku, which is attracting controversy in relation to the easing of accommodation regulations against the background of a chronic shortage of hotel accommodation in Japan’s large metropolitan areas, to provide us with suggestions towards concrete policy orientations in both areas.
１．Tourism in Japan: Status and Issues
According to international balance of payments statistics for Japan, the travel balance recorded a surplus in fiscal 2014. The rapid increase in foreign visitors to Japan became a talking point, but what we should focus on here is the decline in the amount of travel expenditure by Japanese tourists. The figure declined by around two trillion yen in 2014. A major factor in this decline was a rapid shift in the type of travel undertaken by Japanese tourists from the traditional group tour type, in which tourists travel to a variety of destinations, to individual travel focused on experience, which tends to see the traveller staying at a specific destination. Innovation in domestic tourism products in response to this change is severely delayed. The tourism industry in Japan grew with a central focus on domestic demand, and now faces a major turning point. It must turn away from a model in which tourist areas have been developed and tourists catered for based on traditional group-oriented tourism, towards the restructuring of Japanese tourism in its entirety, while also bringing overseas tourists into its purview. The issue here will be to promote the easing of tourism-related regulations and boost the floating population of Japan’s regions with the tourism industry as the central axis. I believe that this will function as a driving force for regional revitalization.
２．Issues towards 2020
2.1 Creation of Japanese-style Destination Marketing/Management Organizations (DMOs) as a Foundation to Boost Regional Revitalization and Tourism to a New Level
Rapid population decline in Japan’s rural areas is resulting in increasing contraction of regional economies. Against this background, increasing the vitality of regional areas by boosting the non-resident population, i.e., promoting regional development by increasing tourism, is an important policy issue in relation to regional revitalization. Attention is being focused here on the launch of Japanese versions of DMOs, tourist organizations which are standard features of advanced tourist regions such as Europe and the US. This issue is discussed in detail in “Creation of DMOs to promote Inbound Tourism: Methods and Issues” by Professor Yoshitaka Mizoo. The concept for the Japanese-style DMOs being advocated by the government is “independently-operated organizations established with the aim of marketing and promoting (branding) tourist areas (regional tourism resources), possessing functions for management of the quality (safety) of services for the acceptance of tourists, the formulation of tourism strategies, and the management of business planning,”*1) which work to assist in regional revitalization. One major issue is promoting a higher proportion of visits to regional areas by foreign tourists. The functioning of these DMOs in regional tourist areas and their ability to newly create environments allowing the acceptance of foreign tourists, and to concretely set in place measures for the cultivation of the necessary human resources and to functionally implement them in regional areas, represent two major factors in successfully increasing visits to regional areas by overseas tourists.。
*1) An excerpt from "Outline of Japanese-style DMO (in Japanese)" (Japan Travel and Tourism Association).
2.２ New Directions in Accommodation Facilities in Japan: Discussion is increasing around the Minpaku Issue
To recap issues discussed in detail by Professor Kumiko Tomikawa in “Towards the Relaxation of Regulations on Minpaku in Japan,” there is a chronic shortage of hotel spaces in large metropolitan areas in Japan, in particular Tokyo and Osaka. This is considered to be due to the doubling of the number of overseas tourists visiting Japan in the two-year period from 2013. In Tokyo, where a 75% hotel occupancy rate was previously considered good, occupancy rates are in excess of 90%, and there is an ongoing inability to ensure accommodation for business travellers. Looking towards 2020, an even greater shortfall in accommodation facilities is looming, but spiralling construction costs mean that it will be difficult to ensure a sufficient number of rooms to respond to the expected demand. Overseas, there is an active sharing economy. The Airbnb website, which connects people seeking to rent accommodation with people needing accommodation, already covers more than 800,000 rooms, etc. located in 33,000 cities in 192 countries.
However, because rental contracts of less than 30 days’ duration are subject to restrictions based on the Hotel Business Act, and it is not possible to offer short-term rentals without satisfying conditions required of accommodation facilities, for example having a reception desk, the use of this sharing economy is not allowed in Japan.
In order to break through this particular “bedrock regulation,” the government is allowing the offering of accommodation for less than 30 days by private individuals or businesses which are not registered as hotels, termed “minpaku” in Japanese, in special zones in which the restrictions of the Hotel Business Act in this respect do not apply. As pioneering examples of these strategic minpaku zones, Tokyo’s Ota Ward and Osaka City have formulated independent regulations and will commence fully-fledged operation from 2016. The regulations provide measures for the prevention of illegal residence for purposes of crime or terrorism, to respond to complaints from neighbours regarding noise or garbage, etc.
Aiming towards increasing the annual number of overseas visitors to Japan to 30 million, the government has also decided to significantly ease regulation on small-scale renting in the Hotel Business Act as a second approach towards stimulating minpaku. As a third approach, it is also considering the expansion of the special strategic zones in which the restrictions of the Hotel Business Act on minpaku do not apply to the entire country.
This paper has considered issues facing Japan’s tourism strategy towards 2020 and looked at the easing of tourism-related regulations for the promotion of regional revitalization. However, while the goal of making Japan a tourism-oriented nation and realizing a significant increase in the annual number of overseas visitors from a base of 20 million in 2016 to 30 million by 2020 is an important one, we must be careful not to merely prioritize the achievement of the target figures. It would be desirable to see comprehensive discussion of the positioning of the tourism industry in Japan covering aims such as what type of people from which countries we seek to attract, for which purposes, and whether we seek to encourage single or repeat visits; these discussions should also encompass concrete measures for the revitalization of tourism demand among the Japanese themselves. We must promote the development of tourism as a new engine of regional revitalization and growth in the Japanese economy which will become a major pillar of economic reform.
* I would like to express the deepest appreciation to Professor Hiroyuki Yasujima of Atomi University for his great help and generous support in pushing forward this study.
- Ministry of Land, Infrastructure, Transport and Tourism ‘Kanko wo meguru genjo to kadai toh ni tsuite (Current status and issues of Tourism in Japan (in Japanese)),’ Document submitted by Keiichi Ishii, Minister of Land, Infrastructure, Transport and Tourism, for the first meeting of ‘Asuno Nihon wo sasaeru kanko bijon kohsohkaigi (Committee for designing visions for tourism to support future Japan),’ November 9, 2015.
- the Prime Minister of Japan and His Cabinet ’Asuno Nihon wo sasaeru kanko bijon kohsohkaigi (Committee for designing visions for tourism to support future Japan (in Japanese)),’ November 9, 2015.
- Masuda, Hiroya (2015) “Tokyo Shometsu: Kaigohatan to chiho-ijuh (Disappearing Tokyo: Nursing Care Bankruptcy and Emigration to the Local Regions) (in Japanese),” Chuko Shinsho.
- Ozawa, Wataru and Machida, Ryuma (2015) “Chuko apahto / manshon ga umarekawaru: Airbnb Akishitsubukken katsuyojutsu (Regeerating used appartments/condominiums: Utilization of vacancy properties by Airbnb) (in Japanese),” Gentosha Media Consulting.
- Kaneko, Isamu (2016) “Chiho-sosei to shometsu no Shakaigaku (Sociology on Regional Revitalization and Disappearance) (in Japanese),” Minerva Shobo.