Top �� Speeches and Statements by Prime Minister

(Provisional Translation)

General Policy Speech by Prime Minister Junichiro Koizumi to the 156th Session of the Diet

January 31, 2003

(Opening) His Majesty the Emperor Akihito is currently under medical treatment. I, together with the people of Japan, extend my heartfelt prayers for His Majesty's speedy recovery. As Prime Minister of Japan, I believe that my duty at this point in time is to bring about a rebirth in the economy and society of our country. Under the basic posture that my Cabinet will advance structural reform without sanctuaries, I hereby would like to describe basic policies for the administration of our country to gain understanding and cooperation of the people of Japan. In the midst of the socio-economic transformation in a global scale, the Japanese economy faces stagnation due to complex structural elements, not merely from cyclical changes of the economy. The presence of "negative heritage" such as non-performing loans and fiscal deficits, and the continuation of a deflationary situation which has never been experienced in the post-war period have brought about a significantly negative impact on economic activity and the lives of the people. It is through advancing bold structural reform and creating a structure befitting the 21st century that we can overcome the current situation and make it possible to realize rebirth and greater development for Japan. We will remove the inefficient segments remaining in our economy and society, establish a foundation for taking up the challenges of innovating technology and launching new enterprises, and create an environment in which people can plan for their future feeling secure. We are steadily undertaking each one of these tasks encompassing such diverse areas. I will keep advancing on the course of no growth without reform. The reforms are on the way, and it will take some time to see that the results are clearly visible. Japan maintains a large foundation to support economic growth, such as high technological prowess, abundant personal assets and a stable society. In spite of the severe circumstances, many people, enterprises and communities are facing forward to take on the challenges that they face. I will materialize these efforts as quickly as possible through advancing reforms, thus leading to the development of our nation. In this session of the Diet, I will submit relevant bills in order to set the reform track that is underway, onto an even firmer course.

(Approach towards Economic Revival) In order to revitalize the Japanese economy, it is necessary to bring in all policy measures. Therefore we will accelerate the four reforms, namely government expenditure reform, tax system reform, financial system reform and regulatory reform. The Government, together with the Bank of Japan, will put all efforts into curbing deflation. In the formulation of the fiscal 2003 budget, under the situation that tax revenue is projected to be 42 trillion yen and there is no choice but to depend on a large amount of bond issuance of 36 trillion yen, we advanced the structural reform of expenditure and general expenditure is kept virutally below the level of fiscal 2002. Within this constraint, we have given consideration to amply establishing safety nets, and boldly have made prioritized budget allocations to areas that will lead to the creation of employment by bringing out the vitality of the private sector as well as areas that will provide the foundation for future development of our nation such as science and technology. Furthermore, we have made reviews on road-related ear-marked revenue and national treasury burdens of compulsory education costs. We will endeavour to pass the fiscal 2003 budget early, and together with the supplementary budget for fiscal 2002, respond to the current situation in a seamless manner. By the early part of the decade beginning 2010, we will aim to achieve a fiscal structure where the government will not rely on fresh borrowings for expenditure other than servicing the interest and principal of the past debt. With regard to tax reform, we have continued discussions since January last year towards building a " tax system as it should be" and decided to conduct a wide range of modifications as one package. In particular, as a concrete measure to mobilize personal financial assets amounting to 1,400 trillion yen, a non-taxable ceiling will be created for donations under a new scheme encompassing inheritance and donations, making gifts of up to 35 million yen tax-exempt when they are used to acquire housing. This measure will be retroactively applied to January 1 this year. Furthermore, in order to promote effective utilization of land, the land transaction tax will be drastically alleviated. In fiscal 2003, front-loaded tax cuts of 1.8 trillion yen in net terms will be advanced, and tax revenue will be neutralized over plural fiscal years. We will exert all our efforts to address the problem of non-performing loans, with a view to terminating the problem in fiscal 2004. We will establish a solid financial system through the steady implementation of the "Program for Financial Revival." There shall be no financial crisis. Through the establishment of the Industrial Revitalization Corporation and a fundamental review of the Law on Special Measures for Industrial Revitalization, efforts will be made towards industrial reorganization and early revival of businesses through maximum utilization of the wisdom and vitality of the private sector. We will strengthen safety nets, through measures such as expanded support measures for expeditious re-employment of people who are forced to leave their jobs, revision of the employment insurance system, and expansion of job-creation measures based on innovative ideas in each regional community. We will revise the system with a view to providing better matching between job offers and job applications, and allow workers to choose among wider modes of employment. We will pay full attention to respond to issues related to the financing of small and medium enterprises (SMEs). We will strengthen support measures for SMEs with viable technologies in their business creation and challenges for new areas of operations, including the securing of financing, technological development and fostering of human resources. With a view to accelerating a shift "from savings to investment," we will substantially lighten and simplify the financial and securities tax systems. Reform of the securities market will be advanced so that it is more accessible and trustworthy to individual investors, through measures such as making it possible to purchase securities at neighborhood financial institutions and by expanding and strengthening corporate auditing. The Fair Trade Commission will be expanded in terms of its organizational structure and will change its status into an agency under the Cabinet Office in April, with the aim of enhancing competition policy that is a key to a fair and free economic society. We will reform the justice system in a comprehensive and intensive manner towards realizing a society where people can have easy access to judicial services anywhere in the nation. Reform-related bills, including a bill for expeditious court proceedings with the aim of concluding the first trial within two years, will be submitted to the Diet.

("From the Public to the Private Sector" and "From the Central to the Local Government") I have been insisting that the most important challenge in administrative and fiscal reform is reform of the public sector, where special public institutions are undertaking business through the Fiscal Investment and Loan Program funded by postal savings and public pension premiums. Harmful aspects of these systems have now become apparent as they tend to bear down on private-sector businesses and leave public burdens in the future by operating on overly optimistic demand forecasts. The fundamental policy should be to put in the hands of the private sector whatever could be done by the private sector. Under this policy, by making a unified approach to reforms of postal services, the Fiscal Investment and Loan Program and special public institutions, we will advance reform towards a simple and efficient government of good quality. The Japan Postal Corporation will start in April. I believe that the Corporation will provide high quality services by introducing the private-sector way of management. Private enterprises will also enter into the postal service. Substantially, Japan's postal business has now made the first step towards privatization. I intend to make further reform efforts on the basis of discussions among the Japanese people. The Fiscal Investment and Loan Program no longer has privileged access to the resources of mandatory deposits of postal savings and public pension premiums, and organizations that have obtained loans now have to find their own methods of finance. The size of the Program has also been curtailed and the size in the initial plan for fiscal 2003 is approximately 40% smaller than the peak level of fiscal 1996. Out of a total of 163 special public institutions and others, we already have initiated reform of 118 organizations, including the abolition of Japan National Oil Corporation. Based on thorough review of their operations, some will be abolished, another will be privatized, and the other will be converted into Independent Administrative Institutions. In addition, efforts will be made so that transparency is increased and strict evaluation is applied. Through these measures, the existing organizations will be transferred to ones befitting the new age. As a result of the policy announcement that the Housing Loan Corporation will be abolished and new housing loans provided by the corporation will be scaled back, private-sector financial institutions have come up with many new, access-friendly housing loan products. As for the privatization of the four road-related public corporations, under the policy of basically respecting the opinions of the Promotion Committee for Privatization, efforts will be made to give concrete shape to the reform by lowering cost of construction and by making a distinction between roads to be constructed by the proposed new corporations and roads to be built by tax revenue. We will make good use of government financial institutions for the time being to ensure smooth financing for small and medium enterprises. After scrutiny of the necessary functions as the Government while monitoring the progress in normalization of the financial functions in the private sector, we will boldly reorganize and integrate these institutions. I believe these reforms in the public sector will facilitate reforms of the fiscal structure, the economic structure and the financial system, thus leading to the creation of substantial benefits in the future. Reform of the Public Servant System will be materialized in order to create an environment in which government employees as the servants for the entire population can devote themselves to administration with morale and sense of mission. The entire Government will make efforts towards increasing the retirement age of the executive public servants, thus correcting the negative aspects of so-called "amakudari" personnel administration (the re-employment of retired public servants in the private sector). We will also lower retirement allowances of public servants in line with the actual circumstances at private-sector firms. Concerning the relationship between the central and local governments, an initial step is earmarked under the fiscal 2003 budget. Based on the principle of "leaving to local governments what can be done by local governments," a reform plan in trinity for the allocation of financial resources, including state subsidies, local allocation taxes and the transfer of tax sources to local governments will be compiled by June as a targeted completion period. We will further promote mergers of cities, towns and villages.

(People's Trust in Politics) People's trust in politics is the very basis of reform. We take seriously the series of recent scandals related to political funds, including the court conviction of an incumbent Diet member for influence-peddling and the case of political donations accused of a violation of the Public Office Election Law. Given that in the previous regular session of the Diet, the revised law providing punishment for politicians who receive compensation for acting as go-betweens in arrangements between private parties and public officials as well as the law for the prevention of collusive bidding at the initiative of the Government agencies were passed, each and every politician should act with propriety under the law, so that he or she does not betray the trust of the people. I also intend to take a firm stance towards ensuring political neutrality of public servants.

(The Challenge Harnessing the Latent Potential of Japan) The awarding of the Nobel Prize to Mr. Masatoshi Koshiba and Mr. Koichi Tanaka was a wonderful event that encouraged the people of Japan. Last year, there were other awards in which Japanese earned global acclaim. Mr. Sumio Iijima, who discovered the carbon nanotube, and Mr. Shuji Nakamura, who first put the blue light-emitting diode (LED) into practical use, were awarded the 2002 Benjamin Franklin Medal, often referred to as "a gateway" to the Nobel Prize. Mr. Koji Nakanishi was honoured with the 2003 King Faisal International Prize, also known as "the Arab Nobel Prize," for his research in biologically-active natural products. Mr. Tadao Ando, an architect, was the 2002 recipient of the American Institute of Architects Gold Medal, the highest honour bestowed by the Institute. Such deeds go beyond scientific and technological fields. Under a severe business environment characterized by surging imports, three enterprises located in Imabari City, a center of towel production, were honored with grand prizes of international exhibitions held in the United States in recognition of their product planning savoir-faire. The artistic quality of the animated film "Sen to Chihiro no Kamikakushi (Spirited Away)" gained worldwide acclaim, garnering the Golden Bear for Best Film of the 2002 Berlin International Film Festival and the 2002 New York Film Critics Circle Award for Best Animated Film. Two Japanese women, Ms. Chie Imai and Ms. Fumiko Taniguchi, were crowned as Leading Women Entrepreneurs of the World. As such, Japan has been highly esteemed. Through the efforts of the entire Government, policy directions have been shown in key areas for the rebirth of Japan, such as science and technology, biotechnology, intellectual property, information technology (IT), urban renaissance, and special zones for structural reform. We will continue to steadily support the challengers in various areas.

(Science and Technology, and Environment) While maintaining strict curbs on general expenditure for FY2003, in order to achieve "a nation built on the platform of scientific and technological creativity," the budget for the promotion of science and technology is to be increased by 3.9% compared to the previous fiscal year and we will lend intensive support to research and development (R&D) projects such as those that will make possible individualized prevention and treatment of diseases on a genetic level. In addition, the Government will apply R&D and investment tax reductions up to the level of 1.2 trillion yen. Support for new technologies will lead to promotion of new industries. The number of venture enterprises in the field of biotechnology has been increasing rapidly and by the end of last year their number had exceeded 300. Decoding of the rice genome was completed in December 2002 under Japanese initiative. The public and private sector will unite in developing biotechnology. With the aim of establishing Japan as a nation built on the platform of intellectual property, we will enhance measures such as speeding up patent examinations, reform of the justice system in the area of patents, and reinforced measures against counterfeit and pirated copies. No time should be wasted in responding to the global warming. It is imperative that central and local governments, enterprises and the people tackle structural reform towards building a "society that exits from inducing global warming". The key to this is "coexistence of environment and the economy". We will promote world-leading environmental industries by promoting the utilization of science and technology. We will promote cultivation of healthy, diverse forests to absorb carbon dioxide emissions. "Green employment" will be promoted with the aim of creating jobs and securing personnel for forestry maintenance. We will make utmost efforts towards the early effectuation of the Kyoto Protocol and the formulation of a set of common rules in which all countries will participate. 70% of general official vehicles will be replaced with low-emission vehicles by the end of FY2003, and by FY2004 the Government fleet will have been switched entirely to low-emission vehicles. Moreover, the Government last year adopted as official vehicles the first fuel cell vehicles in the world (FCV) to be released on the market. Usage of fuel cell vehicles will be promoted through a full review of the regulations. The world's strictest emission regulations on diesel vehicles will be implemented in FY2005. At the same time, measures will be taken to support the development and dissemination of next-generation low-emission vehicles and fuels. Since assuming office, I have pursued the realization of a "zero waste" society. Various recycling systems for food, construction materials and vehicles have already been put in place. From now on, while showing a path towards creating a recycling society, we will take measures with the aim of eliminating illegal waste disposal. The disposal and recycling of waste will be further promoted through streamlining the system for disposing of computers, of which 3.5 million are thrown away every year. As a first-hand effort, recycling of raw garbage in canteens of Ministries and Agencies of the central government are underway. The public sector spanning from the Government will adopt environmental-friendly biomass products, such as eating utensils made from corn, with the aim of bringing them into people's daily lives.

(Rebirth of Japanese Charm) Japan abounds with culture and traditions that are rooted deep in history, and there are talented individuals and enterprises in all corners of the country. I will reconstruct Japan, harnessing the latent potential and charm of regional communities. While promoting 14 urban renaissance projects, we will support high-quality private sector urban development in the 44 areas around the nation designated for urgent improvement through urban renaissance. These are not restricted to large cities alone. In Wakkanai City, Hokkaido, a project is underway to make Wakkanai a city of international tourism and exchange, centering on its links to the Russian oblast of Sakhalin, while in Ishigaki City, Okinawa, town development is proceeding centered on its port. At Matsuyama City in Shikoku, a central theme of city development is the novel, "Saka no Ue no Kumo (Clouds Over The Hill)." We will support efforts that harness local wisdom and originality. Through holding "town meetings" in all areas and in a variety of forms, we will continue to maintain active dialogue with the people. April will herald the birth of the first of the Special Zones for Structural Reform. The second round of invitation attracted over 600 proposals from local governments and the private sector. We will enhance the system and aim to gain the participation of the private sector in hitherto regulated markets, including the participation of joint stock companies in the education field. Regulatory reform on a national scale will be advanced with the Special Zones as leverage. The entire Government will endeavor to promote tourism. While over 16 million travelers leave Japan to go overseas every year, the number of foreign visitors to Japan is no more than about five million per year. We are aiming to double this figure by 2010. Foreign direct investment in Japan will bring new technology and renovative management methods, and will also lead to greater employment opportunities. Rather than seeing foreign investment as a threat, we will take measures to present Japan as an attractive destination for foreign firms in the aim of doubling the cumulative amount of investment in five years.

(Human Resources Development) It is said that the work "Self-Help" by the British writer Samuel Smiles caught the imagination of many young Japanese in the Meiji era. The aspired youth of Japan applied themselves seriously to their studies, made diligent efforts and took the central role in developing the foundation for Japan as a modern nation. In any age it is always the young people with the spirit of self-help and self-discipline, concern for others, and high aspiration who pioneer to a new era. It is people who are the engine for reform. Whether it be a young man teaching mathematics and physics in the Republic of Malawi in Africa, or a woman employed in healthcare guidance in a village in the southern regions of Mexico, there are currently approximately 2,400 members of the Japan Overseas Cooperation Volunteers (JOCV) who, in harsh environments with different cultures and values to those of Japan, are contributing to the nation-building in developing countries. In order to cultivate the ability to face a new era with courage, the modalities for education will be drastically transferred from being uniform and passive, to being independent and creative. As for the revision of the Fundamental Law of Education, we will tackle the issues with firm commitment, based on nationwide discussions. We will advance reform of elementary and junior-high school education, aiming for solid academic prowess and rich minds, and the reform of universities in a manner befitting the mantel of the century of "wisdom". "It is expected that there is no household in a village, nor anyone in any household who has not had an education." Thus it was declared in the proclamation of the Grand Council of the State in 1872, guaranteeing the opportunity for education to all the people of Japan. Today, if a person has the desire, anybody can receive an education on his or her will and responsibility. On the other hand, a new situation has emerged in which children refusing to go to school are increasing. We will endeavor to provide a wide range of educational opportunities in a manner befitting the times. Efforts will be made to enrich the scholarship system, to ensure that the human resources that bear responsibility for tomorrow do not lose their opportunity to study. In Okinawa the concept of the establishment of a Graduate School of Science and Technology, which is open to the world and undertakes educational and research activities of the highest standard will be promoted.

(Structural Reform in Lifestyle) From the mid-1950s to the mid-1960s, washing machines, refrigerators and black and white televisions were called the "three sacred treasures" that symbolized the new lifestyle; from the mid-1960s to the mid-1970s they were automobiles, air conditioners and color televisions. Now, at the time when some are claiming "there is nothing they want", sales of products which befit the new age such as camera-equipped mobile phones, thin-shaped televisions and dishwashers are increasing. The number of people using their free time to polish their skills or take part in goodwill activities is steadily increasing. The eagerness of the people to improve their quality of life remains intact. We will press forward with the structural reform of lifestyle to build a society that allows people to plan their future, free of worry. We will support women as they venture into new fields of employment with a view to the formation of a society in which men and women jointly participate that is in no way inferior to other developed countries. In order to support reconciling work and child-raising, we will continue the campaign for "a zero waiting list for nursery schools" with the goal of increasing the number of children in nursery care by a further 100,000 by FY2004. We will prepare after school clubs for elementary school children and places where child-raising parents can gather to talk and exchange information. In order to reverse the trend towards a declining birthrate, bills to bring together households, local communities and firms to support child-raising will be submitted to the Diet. As for the pension system, we finalized a direction and points for debate last year towards deliberations on reform to be carried out in FY2004. Concerning the medical care system, we recently undertook sweeping reform to ensure universal health insurance coverage so that the people can continue to enjoy efficient medical care with high-quality into the future. With a view to establishing a sustainable social security system, we will continue to advance reform by squarely addressing the modalities of benefits and burdens, on the basis of open and public discussion. Fees for high-speed Internet services in Japan have come down over the past three years from 8,000 yen per month to 2,500 yen per month, and are now at the lowest level in the world. With the high penetration of high-speed Internet and mobile phones, a variety of information services as well as lifestyle-oriented services such as remote medical care and distance education have emerged. The IT revolution is steadily filtering into people's lifestyles. We will formulate a new IT strategy that emphasizes the user's perspective and will make Japan the world's most advanced IT nation in 2005. We will move ahead with e-government and e-municipalities which will be close at hand, convenient and will allow administrative processes to be completed at one site, as well as promote digitalization of broadcasting which will become the basis of household IT. As the legislation that serves as a foundation for the IT society, we will revise and resubmit the Bill on the Protection of Personal Information, with the aim to be approved by the Diet in this session. . We will make utmost efforts to ensure the safety of nuclear power and work to restore confidence. At the same time, we will take appropriate measures to ensure the stability of energy supply. We will pay full attention to ensuring food safety through establishing a structure to respond to emergencies, enacting the Basic Law on Food Product Safety and establishing a Food Safety Committee to evaluate safety on a scientific basis. In order to accelerate reform of agriculture and rural areas, we will promote reform of rice policy and enlargement and corporatization of agricultural management, and we will intensively support "highly motivated and capable enterprises." Exchange between cities and rural communities endowed with ample natural resources will be promoted. We aim to regain Japan's status as "the safest country in the world" by improving the worsening situation in which a large number of heinous incidents occur and a number of people are having concern about the deterioration of public safety. . Measures against organized crimes committed by foreigners living illegally in Japan and hi-tech crimes will be strengthened. While strongly promoting firefighting and disaster prevention measures for large scale earthquakes, we are fully committed to supporting victims and measures for recovery and reconstruction. Last year, the number of fatalities from traffic accidents was down to half of about 17,000 of the worst year on record, 1970. We aim to reduce the number of traffic accident fatalities by half again over the next ten years and to make Japan the safest country in the world for road traffic. A new human rights redress system will be established to provide effective remedy for victims of human rights violations, who are in vulnerable positions. Measures will be taken to extend barrier-free to all areas of society - not just in buildings and public transport but in the systems and consciousness of society as a whole - with a view to establishing a society in which people can live comfortably, regardless of age or disability.

(Crisis Management and Efforts towards Stability in the International Community) As a member of the international community, Japan will continue to make efforts for prevention and eradication of terrorism. We will work to improve the state of preparedness against emergency situations, including incidents of unidentified armed vessels and large-scale terrorism, and aim at the passage of the emergency bills in the current session of the Diet, that have been carried over from the previous session. In order to enhance information gathering capabilities necessary for security and crisis management, we will advance final preparations towards the launch of Japan's first information-gathering satellite at the end of this fiscal year. In order to transform the resolve for international peace into concrete actions, we will actively make efforts towards the "consolidation of peace and nation building", including the promotion of peace negotiations, assistance for refugees and removal of anti-personnel landmines, the restoration and creation of infrastructure and educational assistance. The International Conference on Reconstruction Assistance to Afghanistan that was held in Tokyo in January last year was highly evaluated by the international community. Japan will continue to contribute to peaceful nation building in various regions, including the Democratic Socialist Republic of Sri Lanka and Aceh in the Republic of Indonesia.

(Foreign Policy) In order to ensure peace, security and prosperity of Japan, I will build relationships of mutual trust with the leaders of other countries, and proactively tackle challenges that are facing the international community. We will be active in promoting a wider knowledge of our culture and tradition in other countries, as well as cultural and intellectual exchanges, so that we will develop mutual understanding and wide-ranging cooperative relations. Concerning North Korea, based on the Japan-DPRK Pyongyang Declaration, we will work towards the normalization of diplomatic relations. In close consultation with the United States of America and the Republic of Korea, and in cooperation also with the People's Republic of China, the Russian Federation and others as well as international organizations, we will strongly call upon North Korea to abide by the Nuclear Non-Proliferation Treaty (NPT) and to dismantle the development of nuclear weapons. Giving due consideration to the position of the abductees and their families, we will make maximum efforts towards a total resolution of the abduction issues. It is my intention to strenuously persuade North Korea that the choice that would benefit it most is to become a responsible member of the international community. Recently I paid an official visit to the Russian Federation, with the desire to breathe new life into Japan-Russia relations. As a result, President Vladimir Putin and I agreed on the Japan-Russia Action Plan and were able to deepen our mutual trust. With the aim of concluding a peace treaty through the resolution of the issues of where the four islands, which are an integral part of Japan's sovereign territory, belong, I will develop relations with Russia in a broad range of areas, including politics, economy and culture as countries sharing the same two fundamental values of democracy and market economy. The issue of Iraq's weapons of mass destruction is one that is a threat to the entire international community. It is important for Iraq to cooperate totally and proactively with inspections, and to comply with the relevant resolutions of the United Nations Security Council, including the disposal of weapons of mass destruction. Japan will continue to make substantive diplomatic efforts concerning this issue. This year marks the 150th anniversary of the arrival of the "black ships" of the United States in Uraga, led by Commodore Matthew Perry. The alliance with the United States will continue to be the basis for peace and prosperity of Japan. In addition to making efforts to elevate the credibility of the Japan-U.S. security arrangements, we will continue to have close partnership and dialogue in the political and economic as well as other areas, and will build a solid Japan-U.S. relationship. Furthermore, we will strive for the implementation of the Final Report of the Special Action Committee on Okinawa (SACO), including the relocation and return of Futenma Air Station to ease the burden on people in Okinawa. Moreover, we will provide assistance for the economic independence of Okinawa, taking advantage of its regional characteristics. In order to further develop future-oriented, friendly relations with the Republic of Korea, which became an even closer neighbour to Japan through the success of co-hosting the FIFA World Cup Korea/Japan 2002, I will closely cooperate with the new administration of President Roh Moo Hyun that will be inaugurated in February. This year marks the 25th anniversary of the conclusion of the Treaty of Peace and Friendship between Japan and the People's Republic of China. Based on understanding and trust between the people of the two countries, in order to realize peace, stability and prosperity for the Asian region and also for the world as a whole, we will further promote cooperative relations with China in a wide range of areas. Japan's initiatives proposed last year in January towards a new era in Japan-Association of Southeast Asian Nations (ASEAN) relations, are coming steadily to fruition. Activities have already been implemented for the Japan-ASEAN Exchange Year 2003. Through such events as the Japan-ASEAN Commemorative Summit, planned for the end of this year for the first time in Japan, cooperative relations with the ASEAN members will be further developed. We will build an even closer relationship in wide ranging areas with Europe, the influence of which on the international community is becoming ever greater. In order to promote trade liberalization and strengthen the multilateral trade system that will be to the benefit of all countries including developing countries, Japan will promote the new round of trade negotiations at the World Trade Organization (WTO). We will make active efforts towards economic partnership with the United Mexican States, ASEAN and the Republic of Korea. Through a series of international meetings, such as the Third World Water Forum scheduled for March in the Kansai region, the G8 Evian Summit, and the Third Tokyo International Conference on African Development (TICAD III) scheduled for the end of September, Japan will play a major role towards the resolution of important issues including sustainable development, poverty and infectious diseases in developing countries. In addition to efforts to improve the efficiency and transparency of Official Development Assistance (ODA), it will be extended strategically, with a priority on human security, including such areas as stability and growth in Asia, post-conflict consolidation of peace, and the environment. Based on the sustainable use of marine resources founded on a scientific perspective, we will exert diplomatic efforts on global fishery issues.

(Conclusion) Thirty years have now passed since my first election as a member of the Diet. Immediately after my first election, the Fourth Middle East War broke out, and Japan faced an age of rampant price confusion - within the space of a year commodity prices in Japan rose by more than 20 per cent. This was a period when the greatest political challenge was to control inflation. Through the course of two oil shocks, and then the shock due to rapid appreciation of the yen, over the course of thirty years, Japan has weathered a number of crises that have shaken the economy and the lives of the people of Japan to their very core. However, Japan has leveraged these crises, to develop an even stronger and dynamic economy, through efforts by the entire society for energy conservation, as well as efforts on the part of enterprises for enhancing international competitiveness by intensive energy saving and by making their products highly value added. In the current environment of structural stagnation, for the first time in post-war history, Japan is facing a situation called deflation. Now is the time to recall our experience in overcoming numerous crises and the vigor of Japan that has supported us on previous occasions. What is important is not to avoid failure, but to turn today's failure into tomorrow's success. What is important in your life is, in facing difficulties, not to get discouraged, but rather to stand up and fight once again. In the tumultuous times of the Meiji Restoration and in the confusion in the wake of defeat in the Second World War, our predecessors boldly faced adversity and created the Japan of today. New challenges will not arise from pessimism. Although we are indeed in a severe economic situation, we have within us by far abundant stock as compared to the stock in the previous times and great potential which stems from the stock. Learning from the past, and looking forward with courage and hope, should we not now build a new Japan? In this, I ask from my heart for the understanding and cooperation of the people of Japan and the distinguished members of the Diet.