• Bloomberg, Kyodo

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Japan is set to experiment with opening its borders to small groups of vaccinated foreign tourists as soon as this month, Fuji News Network reported Friday, in a potential lifeline for the country’s ailing travel industry.

Those wishing to visit must have undergone three COVID-19 vaccination shots and be part of a package tour with a fixed itinerary, FNN said, citing multiple government officials. The limited resumption of inbound tourism will be treated as an experiment and, if infections do not spread, the program will be expanded, it said.

Japan is also looking at doubling the daily entry cap to 20,000 and accepting overseas tourists from June, the Nikkei newspaper reported, citing unnamed sources. That report said a decision could come by the end of this month.

The reports came a day after Prime Minister Fumio Kishida said in a speech in London that he planned to relax pandemic-related border restrictions starting in June, in line with other wealthy democracies. He later added a note of caution, telling reporters he needed to look at the state of infections after the Golden Week holiday period, which wraps up this weekend.

Border easing would be welcomed by Japan’s tourism industry, which has been urging the government to allow in more overseas visitors to take advantage of the weakening yen. Until the pandemic, inbound travel was a rare bright spot for Japan’s economy as the number of foreign visitors expanded fivefold between 2011 and 2019. Due to the nation’s strict border measures, the number of foreign visitors slumped from nearly 32 million in 2019 to 250,000 in 2021. Countries including South Korea and New Zealand have recently reopened to tourists, although China’s borders are effectively sealed as the country pursues a “COVID zero” strategy.

“As soon as June, based on the opinions of experts, we will review coronavirus regulations, including border policies, in stages,” Kishida said late on Thursday. “We are still in a period of transition back to normal life.”

While Kishida didn’t mention masks, the government advises using them and the overwhelming majority of Japanese people continue to wear them, both indoors and out.

Several tourism-related stocks gained on the news. Japan Airlines Co. climbed as much as 4.5%, while Japan Airport Terminal Co. surged 6.8%. Travel agency HIS Co., a sector bellwether, erased a morning loss and rose as much as 2.7%.

“Japan was very slow in the economic recovery compared to the U.S. on ‘living with the virus,’ so in that sense, the reopening of Japan will help to boost expectations for inbound recovery,” said Ayako Sera, a market strategist at Sumitomo Mitsui Trust Bank Ltd.

The impact of opening up may be muted by the fact that China, the largest source of tourists before the pandemic, has effectively closed its borders.

Kishida slammed Japan’s borders shut to nonresident foreign nationals in November, a move that polls showed was widely supported by the public as the omicron variant spread rapidly.

While new entry is now allowed for foreign students and businesspeople, he has retained a cap of 10,000 arrivals from overseas per day and until now excluded tourists. His cautious stance — which he credits for helping keep Japan’s virus death rate low — has helped bolster his public support ahead of a key Upper House election set to be held in July.

Calls have been growing in business circles for easing the travel restrictions. Members of a government panel recently said the country’s travel controls should be normalized “as soon as possible.”

Kishida was in Britain on the final leg of his eight-day tour that also took him to Indonesia, Vietnam, Thailand and Italy.

Prior to his meeting with British Prime Minister Boris Johnson, Kishida called for investment in Japan as he aims to rejuvenate the Japanese economy.

“Invest in Kishida,” the Japanese leader told an audience at the City of London, or London’s primary financial district.

To achieve his goal of creating a new form of capitalism, Japan’s revival as an international financial center is needed, Kishida said, pledging to boost investment in human resources, innovation, startups along with green and digital technology.

“I will promote bold monetary policy, flexible fiscal policy and growth strategies that would trigger private-sector investment,” he said.

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