The Japan Research Institute, Limited ("JRI"; President: Shunichi Okuyama) and JTB Corporation ("JTB"; President: Takashi Sasaki) announce the establishment of a "Study Group for New Regional Strategies and Business Models" that will devise new strategies for regional revitalization involving the attraction of consumers from the "senior market" that will be generated as a byproduct of the "2007 Problem" (the dankai generation [Japan's baby boomers] will start reaching retirement age in large numbers in 2007) as migrants and permanent settlers, and provide support for the implementation of these strategies.

The Study Group will work closely with local governments around Japan that express an interest in this theme, with JRI devising business models based on collaboration between public and private sectors and supporting the commercialization of lifestyle-related services and JTB devising regional strategies that make the most of local resources, etc. and promoting the commercialization of services to attract visitors and migrants.

1. Background: the "2007 Problem" and the Coming of an Age of Population Decline

The year 2007 sees the start of a period during which some 10 million Japanese people, including the 6.8 million-strong dankai generation (some 5.4% of the total population and 8.6% of the working population) and the generations immediately preceding and following it, are due to reach retirement age. As Japan moves into an age of population decline, conventional economic stimulus measures are losing their efficacy and for local governments around the country, finding a way to attract the active and rich "senior market" that is about to come into being (chiefly in the Tokyo area and the Kansai region) to their own region will be a major step towards regeneration.

In addition to traditional tourist services, attracting the new "senior market" to visit or settle in a region, will require the creation of a new and diverse service base including lifestyle-related services to support extended stays that give visitors a taste of life in the region, seasonal migration or permanent settling, together with concierge-type services to handle the assembly, coordination and presentation of these services. All these could be described as "destination-led" services closely tailored to the individual region and capable of responding to customer needs rather than as conventional and standardized "point of departure-led" services.

For regions that, in spite of cutbacks to public works in conjunction with structural reform and the migration of industrial production to overseas bases, have been unable to break away from conventional measures for community revitalization and have suffered a decline, the "2007 Problem", which will present the opportunity to create a wide variety of service industries by attracting the "senior market" as visitors and settlers, is the chance of a lifetime in terms of regional regeneration.*2

2. Purpose: the Creation and Implementation of New Regional Strategies and Business Models

September 2005 saw the full-scale launch of two pioneering projects by the Hokkaido Agency - the "Project for the Promotion of Moving to the North" [Kita no Daichi e no Iju Sokushin Jigyo] and the "Project for the Creation of Migration-Oriented Businesses" [Iju Bijinesu Soshutsu Gyomu]. JRI and JTB are closely involved in these projects and have access to the collective "wisdom" of all the local governments pursuing concrete measures - promotion of settlement and community activities, promotion of tourism and migration, employment and "purpose-in-life" measures, impact studies, etc. - in anticipation of the "2007 Problem".

The Study Group will invite local governments that are considering such new measures to participate in its activities and, through the development of a consensus on the issues at stake and the exchange of information with local governments around the country, will seek and pursue the realization of solutions to common problems that would be difficult to overcome for a single local government working in isolation.

Specifically, by studying the individual products and services that make up the service base in collaboration with participating local governments, constructing business models involving a range of possible implementing organizations (including public-private sector consortiums), and sharing and networking the results of this work, the Study Group will seek to aid the creation of a base for the wider development of these projects and aim to commercialize them in collaboration with the private sector, taking local governments with a proactive stance as models.

3. The 3 Activities of the Study Group

In this first year, the activities of the Study Group will center on three areas: the establishment of "study groups" (at the implementation stage, these will become individual projects) led by participating local governments, the hosting of "seminars and symposiums" involving experts, etc. with first-hand experience in the field, the publication of a "newsletter" giving up-to-the-minute information on industry and administrative developments and presenting case studies of advanced projects in Japan and overseas. The Study Group will also seek to promote exchange of information between members.

To mark the establishment of the Study Group will host an "Establishment Commemoration Forum", at which the keynote speaker will be Haruo Shimada, Professor of Economics at Keio University and Special Advisor for Economic and Fiscal Policy to the Cabinet Office.

*1: "Decouverte" is the French for [self-]"discovery", and relates to the concept of "socio-cultural awareness" as used in tourism theory in Europe, namely, that it is only through acceptance and exchange with others that one becomes aware of one's own rich resources. (A well-known example is that of the people of Ireland who, through exchange with foreign visitors (tourists), gained a greater awareness of the resources of their own country and a stronger sense of identity.)

*2: By attracting senior citizens (as settlers), regions can expect to benefit from consumption expenditure (benefits due to direct creation of demand) well in excess of the compulsory expenses (cost of medical care for the elderly, nursing care costs, etc.) that they will eventually have to bear. Moreover, as the lifestyle-related services, etc. to be provided to senior citizens are labor-intensive, the community receives economic benefits in return, in the form of a substantial contribution to the creation of employment. The knock-on economic benefits, including the fresh employment generated by the projects created, the rise in revenue due to the sale and rental of housing in the Tokyo area, etc. and consumption expenditure by employees, are far in excess of the benefits due to direct creation of demand. For example, if a total of 3,000 elderly households whose head is not in employment were to move to the island of Hokkaido on reaching the age of 60 over the three years from 2007 to 2009 (1,000 households per annum), it is thought that they would bring knock-on economic benefits to Hokkaido of approximately ¥570 billion during their remaining lives (as compared with social security and other costs to the public sector of approximately ¥120 billion). On this basis, the knock-on economic benefits to the regions of attracting 6.8 million settlers from the dankai generation would be approximately ¥30 trillion per annum.

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