1.Overview 2.Economic Policy 3.Public Finance  
4.Taxation 5.Monetary Policy and the Bank of Japan   6.Trade  
7.Employment   8.Finance   9.Business  
10.Energy   11.Transportation   12.Science & Technology  
13.Information Technology   14.Agriculture, Forestry, and Fishing Industries        
11. Transportation
In fiscal year 2001 Japan's volume of transportation consisted of 1.425 trillion passenger-kilometers of passenger traffic (same as previous year) and 581 billion ton-kilometers of freight traffic (up 0.5%). The greatest proportion of passenger traffic in 2001 was transported by passenger cars and buses (67.0% of domestic passenger-kilometers), followed by railways (27.0%), airplanes (5.7%), and ships (0.3%). One distinctive feature of Japan compared to other nations is its high degree of dependence on nationwide railroads. The proportion of domestic freight traffic carried by trucks in fiscal 2001 was 54.0%, followed by ships (42.0%), railways (3.8%), and airplanes (0.2%).(*1)

Motor Vehicle Transportation
In fiscal year 1960 Japanese individuals and companies owned 3.4 million motor vehicles. By 1975 this figure had risen to 29 million, and by 2003 it had increased to 76.9 million, a level second only to that of the United States. The number of passenger cars in 2003 was 54.5 million, an average of 1.10 automobiles per household.(*2)
Road construction has kept pace with the increase in the number of motor vehicles, with the first expressway opening to traffic in 1963. As of March 2002 there were 8,017 kilometers of arterial high-standard highways.(*3)
In 2003, the number of people who died in traffic accidents declined by 7.5 percent from the previous year to 7,702, falling below the 8,000 mark for the first time in 46 years, according to the National Police Agency.(*4)
Harmful effects of an automobile-dependent society extend to the environment as well. In addition to local pollution, the emission of carbon dioxide in exhaust fumes is said to contribute to global warming. In December 1993, a law was passed to curb nitrogen oxide emissions, which can also be hazardous. The "Law Concerning Special Measures for Total Emission Reduction of Nitrogen Oxides from Automobiles in Specific Areas" places restrictions on certain vehicles in Tokyo, Osaka, and other major urban areas affected by serious atmospheric pollution.



Rail Transportation

In April 1987, the government privatized the former Japan National Railways into six regional passenger companies and one freight company, known collectively as the Japan Railways Group. East Japan Railway Co. (*1) was listed on the Tokyo Stock Exchange (TSE) in October 1993, and West Japan Railway Co. (*2) in October 1997. TSE listing and the sell-off of the government-owned JR stocks are necessary to finalize privatization of the companies in the group and to enable them to repay their enormous, longstanding debt.

Shinkansen Services
The JR Group operates the Shinkansen "bullet" trains, which are second only to France's TGV (Train à Grande Vitesse) in terms of speed. Differing according to line, the maximum speed of the Shinkansen ranges from 270 to 300 kilometers per hour. The original line, opened in 1964, provided super-express service in 4 hours between Tokyo and Osaka, a distance of 515 kilometers. This line was extended to Fukuoka (Hakata Station)
in Kyushu in 1975. Newer trains covered the distance of 1,096 kilometers from Tokyo to Fukuoka in 5 hours and 49 minutes.
In April 1992 a special new Shinkansen train went into service on the Tokyo - Osaka run, reducing the time taken to cover the distance to 2 hours and 30 minutes. Several other Shinkansen lines have been completed since then, and new Shinkansen lines are now under construction.
In addition to the shorter local lines operated by the JR Group, as of July 2003 there are 74 private railways providing local services, according to the Association of Japanese Private Railways.(*3) Subways are also an important means of transportation in nine urban areas, including Tokyo, Osaka, and Nagoya. Tokyo's subway system has 286 kilometers of track, a network less extensive than those of London (408 km) or New York (371 km), but exceeding those of Paris, Moscow, Chicago, and Berlin respectively.

"Mag-Lev" train
Innovations in railway transportation technology are progressing steadily. Attracting worldwide attention is JR's "linear motor car" (a magnetic-levitation, or "mag-lev," train). An unmanned mag-lev train recorded a speed of 517 kilometers per hour on a test track in Miyazaki Prefecture in 1979, and a manned mag-lev managed to clock 400.8 kilometers per hour in 1987. In view of these successes, another test line, with a length of 42.8 kilometers, was completed in Yamanashi Prefecture in April 1997, and full-scale trials began with the goal of commercialization. In December 2003 a manned mag-lev recorded a speed of 581 kilometers per hour, the world's fastest speed ever for a manned train.
JR envisages commercialization in the early decades of the twenty-first century. If successful, the mag-lev will reach a speed of 500 kilometers per hour, allowing passengers to travel between Tokyo and Osaka in just one hour.

Maritime Transportation
In 2002 there were 130 Japanese-owned ocean-going vessels, down 0.5% from the previous year. Japan's cargo capacity in mid-2001 was 11.99 million tons on Japanese ships and 95.68 million tons on foreign-chartered ships. The former figure is about half the 1994 figure of 26.38 million tons. Japanese shipping companies have held down their capital spending since the mid-1980s due to declining earnings resulting from the rising yen and intense price competition from Asian rivals.
But the business environment has been improving strongly in recent years thanks to rising shipping fares and brisk demand for routes from China and other parts of Asia to destinations such as Europe and the US.



Air Transportation

The number of passengers entering and exiting Japan on international carriers stood at 46.9 million in fiscal year 2001, 1.5 times the level of 10 years before.(*1) As of October 2003 there were 68 Japanese and foreign carriers, representing 41 countries and territories, operating a total of 3,219 flights a week in and out of Japan.(*2) The volume of airfreight to and from Japan in fiscal 2001 was 1.0 million tons.(*3)
The three main passenger carriers in Japan are Japan Airlines Co. (JAL), All Nippon Airways Co. (ANA), and Japan Air System Co. (JAS). In October 2002, JAL and JAS merged their operations under a holding company Japan Airlines System Corporation. The group placed third in global sales ranking in fiscal year 2002, and its share of domestic passenger traffic exceeded that of ANA in the first fiscal-half ending September 2003. Although all three were originally established as private companies, JAL was made into a semi-governmental corporation in 1953 to cope with competition from foreign international carriers.
Under the protection and supervision of the government, JAL, the only firm of the three that operated a scheduled international service until 1987, grew into one of the largest airlines in the world. By the 1980s, however, JAL's management had become noticeably inefficient. To improve passenger service, the government privatized JAL in November 1987, introducing into the domestic airline industry the principle of free competition. Soon thereafter the other two Japanese carriers were allowed to begin international service.
As for domestic air transport, the takeoff-landing scale at Haneda Airport, the only large-scale civilian airport in Tokyo, was expanded in 1997, in response to which two new companies (Skymark Airlines and Hokkaido International Airlines, the latter commonly referred to as Air Do) entered the market in 1998. These were the first new entries into Japan's regular air transportation business in 35 years.
To further expand the capacity of Haneda, the government will start building the fourth runway in fiscal year 2004, with the goal of bringing the runway into service in fiscal year 2009. When work is completed, Haneda will be able to handle 40% more flights. Convenience will be greatly increased for both residents and businesses in the Tokyo area, and access to the capital city will become less complicated for people in other parts of the country. In addition, the completion of the expansion work is expected to accelerate Haneda's development as an international transportation hub.