Why the Japanese government is offering families thousands of dollars

Why the Japanese government is offering families thousands of dollars to leave Tokyo BBC News

January 21, 2023

Japanese couple smiling with baby in their arms

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The intention of the Japanese government is to bring young families to the country’s less populated provinces

The Japanese government will begin providing 1 million yen (over BRL 40,000) per child for each family relocating from the populous capital of Tokyo to one of the country’s provincial communities.

The new amount which represents an addition of about 700,000 yen to the grant currently given to families for resettlement will be granted from April, according to several local media outlets including Tokyo Shimbun newspaper and Kyodo news agency.

According to Japanese media, the government wants to revitalize the provinces outside the capital, where the population is aging rapidly.

In fact, Japan has the highest per capita rate of people over 65 in the world.

However, the measure’s second objective is to reduce population density in Greater Tokyo, which is home to almost a quarter of Japan’s total population: more than 37 million people, making it the most populous city in the world.

And although Tokyo’s population shrank last year for the first time in 25 years, the capital is still seen as a powerful magnet for the country’s younger residents, according to the latest demographic report.

This has left some regions trapped in a spiral of depopulation, with schools falling into disrepair and, in some cases, entire villages being abandoned.

Government officials told the Kyodo news agency that the offer applies to families living in one of the 23 districts in the Japanese capital and in the neighboring cities of Saitama, Chiba and Kanagawa.

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Tokyo is considered one of the most populous cities in the world

And to get the subsidy, they’ll have to move out of this urban conglomerate, although authorities have made it clear they can also reside in some rural areas on the outskirts of the Japanese capital.

High density

The problem, as journalist Leo Lewis of Britain’s Financial Times points out, is that Tokyo remains very attractive to the people who live there, as demand for housing continues to rise.

Despite the COVID19 pandemic and remote working opportunities, the median price for a new apartment in Tokyo has passed its peak during Japan’s 1989 real estate bubble, according to the Real Estate Economic Institute.

And the increased state incentives that have now been announced also have a deeper reason. According to their own statements, only around 2,400 people used the grants offered to move out of the capital in the past financial year.

That’s just 0.006% of the nearly 38 million people who live in the capital.

For Tokyobased British journalist Justin McCurry of Britain’s The Guardian newspaper, the main reason the government’s stimulus program hasn’t worked as expected is that it has certain requirements that prevent it from being very popular.

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Japan has one of the highest aging rates in the world

“Families who elect this benefit must have lived in their new home for at least five years and one family member must be working or planning to open a new business,” the correspondent noted.

“Anyone who moves before the age of five must return the money in cash.”

Japan’s public broadcaster NHK has begun airing a series of reports touting the benefits of life outside the big city to encourage families living in the capital to pack their bags.

“We saw this show and of course you think about it,” Erika Horiguchi, who lives in Tokyo with her husband and daughter, told the Financial Times newspaper.

“But we have no plans to change. There is a reason why Japanese people come to Tokyo and I don’t think the government can change that,” he added.