Press Conference by Minister Nishimura (Excerpt)

*Note: This is a provisional translation for reference purposes only.

9:16-9:32 a.m.
Friday, December 9, 2022
Press Conference Room, METI Main Building

Opening Remarks

Visit to Hyogo

I would like to say one thing.
I will visit Hyogo Prefecture on the 11th. I will visit facilities at Kawasaki Heavy Industries, where industrial robots and various examples of their applications are displayed. I will also inspect demonstration equipment of the so-called DAC (Direct Air Capture) technology, which separates and recovers CO₂ from the atmosphere, one of the most advanced technologies in Japan.

Question-and-Answer Session

Semiconductors

Q: I have a question about semiconductors. The Taiwanese semiconductor manufacturer TSMC revealed in an interview that it is considering constructing a new plant in Japan after the one in Kumamoto. Please tell us your views on this and your intentions to provide support.

A: I am aware that TSMC's executives mentioned in a news program the possibility of building a second plant in Japan. First, I would like to welcome the fact that they are discussing and considering it. We are currently promoting investments in the semiconductor sector by Japanese companies and have prepared support measures. In addition, because the yen has depreciated recently, we have also been approached regarding investments by overseas companies. METI welcomes such investment projects and will promote them as much as possible. We welcome investments in Japan, whether by domestic companies or overseas companies.
Regarding TSMC’s plan to construct a second plant, we will consider what kind of support we can provide as the investment plan becomes more concrete. However, the first new plant in Kumamoto, which I personally visited, is still under construction, although it is progressing very quickly. It is important that it has a steady launch first. To this end, we will provide solid support.

Securing Defense Funds

Q: A hike in corporate taxes was being talked about within the ruling parties to secure funds to cover the increase in defense spending. Although the effective tax rate has been lowered to enhance corporate lending and competitiveness, there are concerns about the impact of a tax hike on businesses. Please tell us your views as the METI Minister on the current direction of discussions.

A: I understand that the ruling parties will discuss funds for defense spending, mainly at their Tax Commissions, based on the discussions at yesterday's Liaison Conference of the Government and Ruling Parties. I expect that they will have balanced discussions based on the concept that all of the citizens will bear the burden, as the Study Group of Experts on Defense Capabilities indicated.
In addition, at yesterday's public-private forum for increasing domestic investment, Chairman Tokura of the Japan Business Federation (Keidanren) indicated an outlook for a level of investment equivalent to 100 trillion yen per year in FY2027, a record-high level comparable to that of the bubble era. We have received very positive and ambitious views and proposals from participants and organizations from different areas.
At the same time, there were also some opinions that no measures should be taken to put a damper on their willingness to invest or raise wages for the sake of securing funds for defense spending.
I have experience participating in the Council on Economic and Fiscal Policy and working as the Minister of State for Economic and Fiscal Policy, so I fully understand the importance of achieving medium- to long-term fiscal soundness. However, when I was Minister of State for Economic Revitalization, as I wrote twice in economic white papers, I believe that now is the last chance to revitalize Japan's economy.
In particular, the business community has shown that it is willing to make the highest levels of investment in history over the next five years, and many companies are showing that they are eagerly working to increase wages. I recognize that under these circumstances, we must work with the belief that the next five years really are our last chance.
This year's tax revenues are projected to reach a record 68 trillion yen. The supplementary budget will switch on investments, increased wages, and increased incomes. As I said before, a positive cycle of investment, innovation, and increased income must be achieved for the next five years. I think now is the time to achieve a growth trajectory ultimately leading to a further increase in tax revenues.
As we are about to switch on bold investments, I believe that we should be cautious about raising taxes at this time so as not to put a damper on or obstruct these investments. I have been telling this to the rest of the government.
Lastly, I recognize that the business community is willing to invest, innovate, and raise wages for the next five years, which will be our last chance, and now is the time for everyone to work together toward building that positive cycle.