In January 2020, world leaders gathered in Davos to discuss the economic outlook for the year. The heads of governments and global corporations agreed that the world economy would recover in 2020, thanks in part to good policies. As we know, the recovery didn’t happen. The world was hit by a pandemic and spent the year in severe economic crisis.

A crisis exposes the weaknesses of a society. In Japan, a delay in digitalization became evident. Amid the turmoil, the Yoshihide Suga administration, which has emerged as an emergency rescue cabinet during the crisis, immediately announced the creation of a Digital Agency, which is expected to be enacted in the parliamentary session of 2021 and launched within the year.

The Japanese economy is slowly recovering. In the second quarter of 2020, GDP growth rate was a grim -28%. The third quarter showed a recovery of 23%, but there are still many problems. Unemployment and bankruptcies have been kept under control for now, but that effort is barely being supported by government subsidies and benefits, and there are concerns that they will expand rapidly in the future. In light of this situation, the government announced a massive economic stimulus package on Dec. 8. Some of the measures include new ideas that have never been seen before, such as a ¥2 trillion Green Fund, mainly for environmental measures and a Digital Fund for digitalization. The government also may issue emergency restrictions in the Tokyo region as soon as possible.