Last Updated 8/14/2020
In order to adequately adjust to the morphing landscape, it is crucial to stay informed on the latest developments affecting businesses and the general public. With the Japan COVID-19 Report, it is our goal to help you do just that. This will be regularly updated as new changes occur.
Government to adopt flexible budget limits to aid recovery
- Prefectural governors request increased grants, warn against Bon travel
Okinawa and Aichi independently declare states of emergency
Tokyo government mulls new state of emergency, issues new requests to businesses
Government requests 70% work from home
COVID-19 in Numbers:
Based off data available on the Ministry of Health, Labour and Welfare (MHLW) website, as of 12:00pm on August 13, Japan has:
- Conducted 1,085,322 PCR Tests
- 51,147 positive cases
- 1,063 deaths
Based off data available on the Tokyo Metropolitan Government website for COVID-19, as of 8:00pm on August 13, Tokyo has:
- Conducted 291,786 PCR Tests;
- 16,680 positive cases;
- 338 deaths.
Despite a slight decline in the number of cases over the last couple of days, Japan has experienced a period of increased transmission over the past several weeks. The pandemic has spread to areas previously thought beyond the virus’ reach. In one instance, 91 people from the same high school in Shimane prefecture, 88 of whom were on the soccer team, tested positive for the coronavirus, drawing increased attention to the risks posed by schools, dormitories and club activities.
While prefectures like Aichi and Okinawa have independently declared states of emergency, the national government remains largely opposed to another shutdown, which would hit Japan’s ailing economy. Members of the Cabinet, including Chief Cabinet Secretary Suga Yoshihide, Revitalization Minister Nishimura Yasutoshi and Prime Minister Abe Shinzo, have all made it clear that the government does not believe the current situation warrants a second nationwide emergency declaration. Juxtaposed with increased activity by prefectural governors, the national government’s lack of a coherent plan or clear messaging has contributed to growing disapproval of the Abe administration.
In that vein, PM Abe has faced growing criticism in recent weeks for his absence from the public sphere and for what many consider a lackluster response to the pandemic. The Cabinet’s approval rating has fallen to 34%, its lowest point since the start of the second Abe administration in 2012. With a second emergency declaration remaining popular with the public, the government continues to find itself trapped: refusing to enter lockdown may cause the number of cases to balloon past a manageable point, but declaring a state of emergency has the potential to cause major economic harm.
If the number of cases remains at or exceeds current levels and the national government continues to drag its feet, it is likely that it will face a greater backlash, resulting in an untenable political position for Abe and the ruling Liberal Democratic Party. At present, widespread disapproval of PM Abe has yet to translate into similar levels of disapproval for the ruling party. While the opposition’s continued inability to form an effective, unified front gives the LDP some breathing room, it may not be long before Abe and the LDP will need to take decisive action by reconvening parliament, declaring a state of emergency or calling an election.
Government to adopt flexible budget limits to aid recovery
- In addition to extending the deadline for budget requests, the Ministry of Finance has announced that government ministries and agencies can request funds for the upcoming fiscal year that are not subject to a cap. Funds exceeding budget allocations from last year will need to be related to the coronavirus pandemic or related economic recovery efforts.
- The Cabinet has approved the use of ¥1.13 trillion ($10.6 billion) of government reserves to combat the economic downturn caused by the pandemic. A large portion of the newly allocated funds will be used for stimulus payments to small- and medium-sized businesses which have been hit especially hard by the drop in consumer spending over the past several months.
Prefectural governors request increased grants, warn against Bon travel
- The governors of Japan’s 47 prefectures have petitioned the national government to increase emergency grants and funds for bolstering medical infrastructure and bailing out restaurants and other establishments hit by the pandemic. The governors also warned against interprefectural travel during the Bon festival, a period during which it is customary to visit family and hometowns — often by traveling across prefectural lines.
Specialist panel emphasizes hospital occupancy rates in emergency declaration discussions
- As discussions about a possible second national state of emergency continue, the government’s advisory panel proposed a new set of indices that includes hospital occupancy rates to evaluate the state of the pandemic and the need for another declaration. The panel has set out a four-stage framework with specific numerical criteria for each stage.
Tokyo government mulls new state of emergency, issues new requests to businesses
- Tokyo Governor Koike Yuriko has revealed that she may redeclare a state of emergency should the rates of infections continue to grow, but has not offered any numerical thresholds that would trigger such a decision. She insisted that her administration is doing everything possible to avoid that scenario.
- The Tokyo governor also reassured the public that a Tokyo CDC-like institution will be established in August, and be fully operational in October. Tokyo’s conceived CDC would work with the Metropolitan Government to expedite reports of cases, expand testing capacity and streamline the government’s pandemic measures.
- With the capital still under red alert and the central government’s guidelines, crowds both indoors and outdoors are limited to 5,000 people until the end of August. Restaurants and karaoke bars serving alcohol have been asked to close at 10 p.m., and they will receive ¥200,000 if they comply.
Okinawa and Aichi independently declare states of emergency
- After a spike in infections originated in U.S. military bases, the Okinawan government quickly called its own state of emergency on July 31. The state of emergency was to last until August 15, but the governor extended it to at least August 29. Residents will be asked to avoid nonessential outings within the prefecture and travel outside of Okinawa. Restaurants in the prefectural capital, Naha, will be requested to limit their operations from 5 a.m. to 10 p.m. Governor Tamaki Denny told reporters that he thinks a state of emergency should be declared nationwide.
- Having recorded more than 100 cases daily for over a week, Aichi joined Okinawa in declaring a prefectural state of emergency that will be in effect from August 6 to August 24. Governor Omura Hideaki requested that residents refrain from interprefectural travel, nonessential outings and large social gatherings. Governor Omura also decided to request the temporary closure of certain establishments in downtown Nagoya that have been identified as the source of cluster outbreaks.
Government Requests 70% Work from Home
- Minister Nishimura Yasutoshi said the government will urge companies to have 70% of their staff work from home. For those that cannot work from home, the government will request that companies impose staggered commuting times and refrain from hosting large social gatherings like parties and similar events.
Government eyes penalties for those not following shutdown requests or lockdown orders
- The Japanese government is mulling a package of legislative amendments with the aim of strengthening the central and prefectural governments’ ability to fight the pandemic. The revisions will be included in the Special Measures Law and the Quarantine and Immunization Laws.
- The new measures will likely include penalties for businesses and individuals not following business suspension requests or lockdown orders. Individuals not following requests to follow quarantine orders in the airport would also be subject to fines.
- While penalties are still under discussion, new revisions would also give the central government the power to give instructions regarding the nationwide implementation of PCR tests in health offices.
- Minister Nishimura is discussing the constitutionality of the amendments with the Cabinet Legislation Bureau. If accepted, the revisions will be submitted to the Diet during next year’s ordinary session, as no extraordinary session has been set for the fall.
Foreign Ministry increases re-entry requirements for foreign residents entering from virus-free countries
- The Ministry of Foreign Affairs has increased the requirements and entry procedures for foreign residents re-entering Japan from Peru, the Philippines, Pakistan and Bangladesh. Notably, they will need to submit negative PCR test results before departure, along with documents proving they can re-enter Japan. This documentation will be required of all non-Japanese residents coming from anywhere from September 1. Japanese nationals will be able to return without such documentation. Everyone entering Japan will need to take a PCR test upon arrival and self-quarantine for two weeks.
- The Foreign Ministry will gradually ease restrictions on the rest of foreign visitors through a three-stage process. It will first allow entry for people travelling for business purposes and researchers, followed by international students to meet private sector demand for part-time workers. The third stage will involve allowing entry to international tourists.
- The ministry will gradually allow entry to countries based on their diplomatic relations with Japan and the countries’ infection rates.
- No timeframe has been yet set for the three-stage process.
- Workers and educators who live in Japan will be among the first eligible for re-entry, with the first permissions granted to business operators based in Japan from the U.S. and Europe. Expatriates and long-term residents will have to undergo a 14-day quarantine either at home or a designated location. They will also need to report their health condition via LINE to health authorities and install a COVID-19 tracing app that will retain GPS data for 14 days.
- Eligible business travellers from Singapore and Japan will be exempted from a 14-day quarantine, if they give a detailed itinerary to immigration officers, avoid crowds and public transportation.
Go To Travel campaign goes forward without Tokyo
- The Tourism Ministry has moved ahead with an initiative to encourage domestic tourism from July 22 without Tokyo prefecture — travel by the capital’s residents and trips to and from Tokyo prefecture will not be eligible for government subsidies. The government pushed forward with the program despite the recent surge in coronavirus cases and against the advice by the head of an advisory committee.
- Governors have called for the campaign to be postponed until August, although some, like Shimane Governor Maruyama Tatsuya, oppose it all together. In an online meeting, governors asked the central government to consider excluding more prefectures from the program. They also urged the government to extend the campaign period because many prefectures are unable to properly welcome tourists as they deal with the impact of flooding earlier this month.
- The “Go To Travel” campaign consists of government subsidies for accommodation and transportation to incentivize tourism and consumer spending.
- LDP Policy Chief Kishida Fumio revealed that the Cabinet is considering issuing compensation to those cancelling travel arrangements through the Go To Travel program due to Tokyo’s exclusion. Tourism Minister Akaba Kazuyoshi, on the other hand, wants to incorporate Tokyo at a later stage if the rate of infections decreases.
Minister Nishimura doubts government will ease crowd limits until end of August
- Economic Revitalization Minister Nishimura revealed that the government is reconsidering its plan to relax attendance limits for major events, indicating the government may not ease restrictions next month because of the increasing rate of COVID-19 infections. The limits on attendance for major events and concerts were expected to be scrapped from August 1. The government recently relaxed attendance restrictions, allowing up to 5,000 people to gather at indoor venues so long as they remained below 50% capacity. A committee will meet to discuss the crowd limits.
Japan's major airports may open coronavirus testing centers in September
- Authorities will probably start operating coronavirus testing centers in large cities and airports from September because of easing entry restrictions.
- The objective is to carry out at least 9,000 PC tests per day on travellers in Haneda, Narita and Kansai airports, as well as within the Tokyo and Osaka metropolitan areas. After improving the capabilities of quarantine stations, the government is confident that it can increase daily PCR tests to 13,000 per day.
- Authorities are already trying to reduce testing times and the time required to deliver results through the introduction of more advanced testing kits. The government is also looking at whether to test people leaving the country at airports. Anyone who tests negative at PCR centers will be issued a certificate.
Japan to include employment support measures for foreign technical trainees
- On July 14, the government rolled out employment support packages for foreign technical trainees who lost their employment as a result of the pandemic with the aim of attracting more foreign workers. The policy package, which was revised last year, was amended to include pandemic-related issues. However, the support for foreign technical trainees will only apply to the 14 industries covered by the scheme prior its expansion in April 2019.
- The government also moved forward with the creation of a certified Japanese-language teacher status and the expansion of an online residence application framework.
Government mulls asking prefectures for business closure requests
- The Japanese government is considering asking the prefectures of Tokyo, Kanagawa, Saitama and Chiba to request business closures if the situation worsens. Economic Revitalization Minister Nishimura urged governors to invoke Article 24 of the newly revised Special Measures Law if needed, which allows regional governments to issue business suspension requests.
- Most of the new infection cases have reportedly originated around nightlife establishments, although new infection clusters have also been identified in nurseries, hospitals and offices. However, the government wants to focus on nightlife establishments not following guidelines, such as encouraging the use of masks and ventilating venues. Minister Nishimura has stressed the need to continue to avoid the three Cs: closed, crowded and close-contact areas. Additionally, the minister has highlighted that he plans to have employees of the nightlife industry take PCR tests.
- The Chiba Prefectural Government on July 13 issued closure requests to hostess bars, host clubs and other nightlife special services facilities, which have not taken adequate prevention measures. Saitama has also issued requests for business closures on July 12.
- The Osaka Prefectural Government has asked its residents not to visit nightlife establishments which have not taken adequate measures. On July 12, the Osaka government raised its warning level to yellow, a step below the red level that comes with the regional government issuing its own state of emergency.
New government subcommittee on new coronavirus holds first meeting
- A new government subcommittee focused on the coronavirus, which replaced the panel of infectious disease experts that had advised the government until now, held its first meeting on July 6. The meeting offered a chance for officials to reconsider their positions and clearly lay out their responsibilities. It is composed of 18 members from both the public and private sectors.
- The goal of the subcommittee, as highlighted by Economic Revitalization Minister Nishimura Yasutoshi, is to come up with measures that balance public health and the economy. The previous panel focused exclusively on public health.
- Participants discussed current pandemic infection rates, vaccinations, routes of transmission and measures to prevent a future pandemic, but the core focus was the alarming situation in Tokyo. The panel is seeking feedback on easing restrictions and collecting data.
- The importance of the committee is expected to grow as infections in Tokyo mount.
Immigration Services Agency resumes issuing certificates of eligibility
- Japanese immigration authorities have resumed processing visa applications in a bid to again allow foreign nationals back into the country. Visa operations will be expanded gradually, and only a limited number of visa applicants will be permitted at first. From June 26, the Immigration Services Agency (ISA) resumed issuing COEs (certificates of eligibility), a document required for all work visa applications. COE applications received between October 2019 and January 2020 will receive priority. Re-entry so far has been limited to foreign residents wishing to come back on humanitarian grounds. The Foreign Ministry and the ISA still have to decide on a timeline for the entry of all foreigners. The ISA will use the new system until May 2021.
Bank of Japan expands support to businesses hit by pandemic
- After a biweekly policy meeting on June 16, the Bank of Japan (BOJ) has expressed its intention to continue and expand its campaign supporting businesses hit by the virus. The BOJ will increase corporate support measures to ¥110 trillion ($1 trillion) from ¥75 trillion.
- The continued support by the BOJ is aimed at preventing companies from running out of cash, while keeping regional economies stable. However, there is widespread recognition at the BOJ that economic recovery will take time, meaning it will continue to provide low interest rates and equity purchases.
- The central bank also maintained its 2% inflation target. In the policy meeting, only one member of the board called for additional interest rates cuts.
Labor Ministry wants to pay unemployment benefits to workers on leave
- The Ministry of Health, Labour and Welfare wants to implement the deemed unemployment system used in disaster areas after the earthquake in March 2011. That means that the government can pay employees taking leave the same amount provided by regular unemployment benefits, as long as the state of emergency lasts.
- Workers will have to submit a streamlined application to their local unemployment office to receive an instant payment. Payments will be capped at ¥15,000 per day, but amounts will vary depending on the employee’s income and how long they have paid unemployment insurance.
- This still requires government approval and a subsequent parliamentary amendment to current law. The government hopes to use this measure to help workers in financial difficulty, even if they were not formally dismissed by their employer.
Government to inject capital in medium- and large-sized corporations
- The central government will inject cash in medium and large-sized corporations struggling with the effects of the pandemic. These will add to the already ongoing government support through low-interest loans and subsidies. Cash injections, however, for large corporations, will remain as a safety net should their negative economic outlook continue or worsen.
- The government plans to introduce subordinated loans through the Development Bank of Japan and the Japan Finance Corporation. Purchase of stocks with no voting rights for companies whose finances have decreased rapidly, will also be considered by the government.
- These measures will be funded by the second supplemental budget. Necessary amendments will be introduced into law so as to allow the injection of public capital to help private financial institutions beyond the current deadline of March 2022.
Government to inject capital in troubled SMEs
- The government will establish a program to directly finance SMEs severely hit by the current economic crisis. The Regional Economy Vitalization Corporation, a public-private partnership, will distribute up to ¥1 trillion to financially troubled companies where loans would not be sufficient.
- The scheme allows for an injection of up to ¥10 billion per company. Eligible companies will be SMEs that are important to local and regional economies, have at least ¥1 billion worth of annual sales and a minimum of 50 employees. About 10% of SMEs in Japan are expected to meet those requirements. Most recipients will be in the hotel, logistics, tourism and retail industries, as well as subcontractors of large companies. Companies that were struggling before the effects of the pandemic on the economy are not eligible for funding.
- The goal is to avoid bankruptcies that would deal a severe blow to regional economies. Additional measures will be discussed if they are believed to be necessary to support local businesses.
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