Political Pulse

Suga Takes the Wheel in Drive to End Japan’s Ban on Ride-sharing

The Yomiuri Shimbun
Visitors to Japan line up at a cab stand at Tokyo Station.

By Michitaka Kaiya / Yomiuri Shimbun Staff Writer

10:51 JST, November 4, 2023

In some countries, paid ride-sharing is a system in which private drivers transport passengers in their own cars. Japan is not one of those countries, as the system is banned here.

But within the Japanese government and the Liberal Democratic Party, debate over lifting the ban is intensifying. Former Prime Minister Yoshihide Suga, a reform-minded leader, is leading the charge, and the idea of lifting the ban is gaining momentum.

The government has taken a cautious stance due to safety concerns, but Prime Minister Fumio Kishida said in his policy speech at plenary sessions of both houses of the Diet on Oct. 23 that he acknowledged that the shortage of local transportation providers is a serious problem. He stated, “We will address the issue of ride-sharing.”

The debate began in August when Suga gave a speech in Nagano City. Suga said: “As a practical matter, there is a shortage of cabs. Many tourist spots are crying out for more taxis.” When asked by the moderator if he was open to lifting the ban on ride-sharing, he replied: “I think so. I would like to discuss it [within the party].”

Suga is a native of Akita Prefecture and has served as a member of the Yokohama city council. He has a deep interest in revitalizing local communities. Suga is also known as a standard-bearer for regulatory reform. When he was chief cabinet secretary in the administration of Prime Minister Shinzo Abe, he pushed through the relaxation of visa issuance requirements for entry to Japan over the objections of the Justice Ministry and the National Police Agency, which were concerned about the potential deterioration of public safety. The number of inbound tourists to Japan increased significantly, especially from Southeast Asia.

Visitor numbers, which plummeted amid the coronavirus pandemic, are clearly recovering. The estimated number of foreign visitors to Japan in August reached about 2.16 million, more than 80% of the pre-pandemic level of the same month in 2019. On the other hand, the number of corporate cab drivers in fiscal 2021 was about 220,000, down by more than 120,000 from a decade ago.

Suga sees the growing shortage of cabs as a big problem. Tourists are waiting in long lines for cabs at airports and tourist attractions. With the number of tourists increasing again, he decided that it was essential to lift the ban on ride-sharing, a mode of transport that has become prevalent in the United States and other countries.

In contrast, Chief Cabinet Secretary Hirokazu Matsuno has been cautious, saying, “I recognize that there are various issues from the perspective of ensuring safety and protecting users.”

Also, the LDP Taxi and Hire Lawmakers’ Federation, which advocates for the taxi industry, has taken a stance against lifting the ban. Masahito Moriyama, the group’s secretary general, said at a meeting on Oct. 17: “We cannot easily allow ride-sharing. We are a parliamentary group to protect the industry, but we are not just doing this for the industry alone.” Moriyama, who is also the education minister, stressed the importance of being aware of the issue of how to supply safe and secure cab services for the benefit of users and the public.

However, Suga emphatically told those around him: “I’m serious about this. We will take various measures.”

In response to this stance, a senior government official said, “We have to think about how to gradually allow ride-sharing.”

The government cannot ignore the debate because it sees the risk of the issue turning into a political situation if it is left unaddressed. In addition to Suga, former Environment Minister Shinjiro Koizumi and current digital minister Taro Kono support lifting the ban on ride-sharing. Koizumi and Kono are close to Suga, and all three men were elected from constituencies in Kanagawa Prefecture. In the 2021 LDP presidential election, Suga and Koizumi backed Kono, who ran against Kishida.

Koizumi has told those around him: “Many people do not yet know the real picture of ride-sharing, so the safety debate is heated among those who are cautious. If we strengthen the dissemination of information, understanding will increase.”

Kono hopes to accelerate discussions toward lifting the ban at the Digital Administrative and Financial Reform Council, which has jurisdiction over the issue. At the first meeting of the council, on Oct. 11, the introduction of ride-sharing was positioned as one of the priority areas for reform.

Of course, in discussing the lifting of the ban, there are many issues to be considered, such as how to deal with cases involving crimes and how compensation should be provided in the event of an accident. Suga seems to have stolen a march on Kishida, who is concerned about stability.

Speaking on TV Tokyo on Oct. 24, Kishida said: “What is the appropriate way to engage in ride-sharing in Japan? A system that fits the national character is required. We hope that a system that is suited to Japan will be considered as soon as possible.”

Later, responding to questions at the Budget Committee of the House of Representatives on Oct. 27, he said it was “necessary to think about the system in earnest.”

The final decision on whether the prime minister will move to lift the ban and whether a Japanese version of ride-sharing will be introduced will be closely watched. It will also show the future of power relations in the political world.

Political Pulse appears every Saturday.