$628 bln green energy market central to Japan growth strategy
Japan will aim to create a 50 trillion yen (USD628 billion) green energy market by 2020 through deregulation and subsidies to promote development of renewable energy and low-emission cars, a draft of the government's growth strategy showed.
The government will also work with the Bank of Japan to ensure the country exits deflation and achieves stable price growth, according to the draft obtained by Reuters. The draft states that clean technologies will be central to the government's efforts to revive the economy over the next eight years.
"The government hopes the BOJ maintains powerful monetary easing to beat deflation," the draft said.
"We will also continue to monitor currency market moves carefully and act appropriately as needed," it said, warning that excessive currency volatility would hurt Japan's economy.
The government is in the process of crafting a long-term strategy to boost Japan's growth potential and seek new areas of growth, and hopes to finalize it by the end of this month.
The target is expected to focus almost exclusively on renewable energy sources such as wind, solar, and geothermal energy, after last year's Fukushima disaster prompted the government to shelve plans for new nuclear reactors.
Reuters also reported that the focus on green energy is likely to lead to further support for the development of low and zero emission vehicles.
With the government also edging forward with plans for a carbon pricing mechanism, the growth strategy would entrench Japan's position as one of the world's most attractive markets for green businesses and low carbon infrastructure developers.
The news also comes just weeks after the government approved one of the world's most ambitious renewable energy subsidy regimes, which will provide feed-in tariff incentives to renewable energy developers that are far in excess of those currently offered in European markets such as the Germany and the UK.
The government has said the feed-in tariff regime should allow the country to increase its renewable energy capacity by around 13 percent over the next year, a trend it is now keen to continue over the next decade.