Overview of ’s Economy Tokyo is the Hub of ’s Economic Activity

Population Land Area Number of Employed Persons １27,094,745 377,972㎢ 59,611,589 2015 2016 2010

Number of Establishments Number of Enterprises Ratio of Small and 5,541,634 1,750,071 Medium Enterprises 2014 2014 99.7％ 2014

Number of Foreign- Number of Enterprises Capitalized at 1 Billion Yen or More Affi liated Companies 3,158 5,919 2016 2014

Gross Domestic Product (Nominal) Prefectural income per capita (all prefectures total) 532.2 trillion yen 3,065 thousand yen FY2015 *2011 average FY2013

Loans Outstanding of Banks (Domestically Licensed) 474.0 trillion yen end of December2016

Number of Foreign Visitors 24.0 million 2016( preliminary)

Number of Factories Value of Manufactured Goods Shipments Value of Exports Value of Imports 393,391 287.3 trillion yen 70.4 trillion yen 66.0 trillion yen 2011 2011 2016( revised) 2016( preliminary)

Number of Establishments Annual Product Sales (Wholesale, Retail) Number of Universities Number of Research (Wholesale, Retail) 777 Number of Students Institutes for National Sciences 1,407,235 478.8 trillion yen 2,873,624 2014 2014 FY2016 5,641 2014 *including establishments owned by national and local governments

Ratio of Tertiary Industry Persons Engaged in Work Gross Prefectural Product Number of Establishments (Service Activities) (all prefectures total) (Information and Communications) 70.6％ 99.8 trillion yen ６6,236 2012 FY2013 2014

[Sources] ・ MIC “Population Census” ・ CAO “Annual Report on National Accounts” ・ MOF “Trade Statistics of Japan” ・ Geographical Survey Institute, MLIT “Land Survey of Prefectures, Shi, Ku, Machi and Mura” ・ CAO “Annual Report on Prefectural Accounts” ・ METI “Census of Commerce” ・ MIC “Economic Census for Business Frame” ・ BOJ “Deposits and Loans Market” ・ MEXT “School Basic Survey” ・ Small and Medium Enterprise Agency ・ JNTO materials ・ MIC “Employment Status Survey” “White Paper on Small and Medium Enterprises in Japan” ・ MIC / METI ・ Toyo Keizai, Inc. “Foreign Affiliated Companies in Japan: A Comprehensive Directory” “Economic Census for Business Activity: Tabulation of individual industries (Manufacturing Industry)”

2 Industry and Employment in Tokyo - A Graphic Overview 2017 Tokyo is the Hub of Japan’s Economic Activity Tokyo is the Hub of Japan’s Economic Activity

Population Daytime Population Land Area Number of Employed Persons (based on workplace) 13,515,271（10.6％） 15,576,130 2,191㎢（0.6％） 8,174,194（13.7％） 2015 2010 2016 2010

Number of Establishments Number of Enterprises Ratio of Small and Medium Enterprises （11. 8％） （15.6％） 653,819 272,754 99.0％ 2014 2014 2012

Number of Foreign- Number of Enterprises Affi liated Companies Capitalized at 1 Billion Yen or More 2,419（76.6％） 2,964（5 0.1％） 2016 2014

Gross Prefectural Domestic Product (Nominal) Prefectural income per capita 95.4trillion yen 4,508 thousand yen（147.1％） FY2015( preliminary) ※ 2005 average FY2013

Loans Outstanding of Banks (Domestically Licensed) 201.2 trillion yen（42.4％） end of December 2016

Number of Foreign Travelers to Tokyo 11.9 million 2015

Number of Factories Value of Manufactured Value of Exports Value of Exports ( of Tokyo, Goods Shipments , and Narita Airport) ３4,879（8.9％） (Port of Tokyo, Haneda Airport, and Narita Airport) 8.9trillion yen（3 .1％） （21.7％） （34.2％） 2011 2011 15.2 trillion yen 22.6 trillion yen 2016( preliminary) 2016( preliminary)

Number of Establishments Annual Product Sales (Wholesale, Retail) Number of Universities Number of Research (Wholesale, Retail) 137（17.6％） Institutes for National Sciences 167.9 trillion yen（3 5.1％） （26.0％） （11. 2％） Number of Students 746,397 889（15.8％） 157,968 2014 FY2016 2014 2014 *including establishments owned by national and local governments

Ratio of Tertiary Industry Gross Prefectural Product (Service Activities) Number of Establishments Persons Engaged in Work (Information and Communications) （19.2％） 81.5％ 19.1 trillion yen 22,590（3 4.1％） 2012 FY2013 2014 Percentage in parentheses represents the proportion to the national total. [Sources] ・ MIC “Population Census” ・ TMG “Annual Report on Prefectural Accounts, preliminary and estimated” ・ Tokyo Customs materials ・ Geographical Survey Institute, MLIT “Land Survey of Prefectures, Shi, Ku, Machi and Mura” ・ CAO “Annual Report on Prefectural Accounts” ・ METI “Census of Commerce” ・ MEXT “School Basic Survey” ・ MIC “Economic Census for Business Frame” ・ BOJ “Deposits and Loans Market” ・ TMG Bureau of Industrial and Labor Affairs materials ・ MIC “Employment Status Survey” ・ TMG Bureau of Industrial and Labor Affairs research ・ MIC / METI ・ Toyo Keizai, Inc. “Foreign Affiliated Companies in Japan: A Comprehensive Directory” “Economic Census for Business Activity : Tabulation of individual industries (Manufacturing Industry)”

Industry and Employment in Tokyo - A Graphic Overview 2017 3 Overview of Tokyo’s Economy While Forming a Huge Economic Base, Tokyo Faces

1 Tokyo’s Economy is Comparable to a Country’s Economy

Gross domestic product (nominal) by country Gross prefectural product (nominal) and prefectural (worldwide, 2014) income per capita by prefecture (nationwide, FY2013)

(100 billion US dollars) 180 173.5 (Trillion yen) Prefectural income (1,000 yen) 120 per capita (right axis) 5,000 160 4,508 140 100 120 93.1 4,000 103.5 3,579 100 80 3,019 80 2,859 3,000 2,995 2,972 60 60 46.1 40 38.7 29.9 28.3 24.2 2,000 21.4 20.5 18.6 17.8 20 14.5 14.1 13.8 12.9 40 37.3 8.8 8.6 8.0 35.4 30.2 0

UK 20.7 19.8 Italy 1,000 USA India Brazil

Spain 20 China Tokyo Japan Russia Turkey France Mexico

Canada Gross prefectural product (nominal) Australia Germany Netherlands South Korea 0 0 Aichi Chiba Tokyo Osaka

Note: The above comparison is for 2014 (calendar year), except Tokyo (from April Saitama

1st, 2014 to March 31st, 2015) and Australia (from July 1st, 2014 to June Kanagawa 30th, 2015). The gross prefectural product in Tokyo is converted to US dollars by using the 12-month simple average of the monthly average value of the interbank spot central rates at the Tokyo Foreign Exchange Market (1 US dollar = 109.92 yen). Note: Top 6 prefectures in gross prefectural product are listed. Source: TMG “Annual Report on Prefectural Accounts” Source: CAO “Annual Report on Prefectural Accounts”

4 Establishments Mainly in “Information and 5 Number of Small and Medium Enterprises Communications” are Concentrated in Tokyo (SMEs) Accounts for 99% of All Enterprises Number of establishments and percentage in the whole country by industry (Tokyo, 2014) Number of enterprises by industry and enterprise size, and percentage of SMEs (Tokyo, 2012) (10,000 establishments) (%) 30 Percentage in the whole country 40 Large enterprise Medium enterprise Small enterprise (right axis) (10,000 enterprises) (%) 14 99.6 99.7 99.2 99.6 99.5 99.5 99.7 100 34.1 35 99.2 98.7 Others 98.5 25 12 99.0 Percentage of 98 9.9 10 SMEs (right axis) 97.2 Company 30 97.0 96 8 96.1 20 94 Individual proprietorships 6.0 25 6 4.8 4.9 92 15.8 4 3.7 3.6 3.5 15 18.8 20 2.4 2 1.7 1.6 90 1.1 0.9 16.1 0.4

0 . 88 12.8 15 10 11.8 11.4 10.8 11.0

9.9 t services 13.0 8.2 10.1 11.2 9.3 10 12.2 6.2 and leasing Construction

4.9 4.8 4.8 Manufacturing drinking services 5 4.2 4.3 4.0 Services, n.e.c All industries total

5 and technical services 2.3

1.6 1.8 Living-related and personal 1.1 Finance and insurance Wholesale and retail trade Medical, health care and welfare Scientific research, professional services and amusemen Real estate and goods rental Education, learning support Transport and postal activities Accommodations, eating and 0 0 Information and communications

Note: The industrial divisions which have 1,000 or more small and medium enterprises are listed. SMEs and small enterprises are defined in accordance with the

Construction definitions in the Small and Medium-sized Enterprise Basic Act. Excludes Manufacturing

Services, n.e.c. the establishments which are unable to classify to whether the business All industries total rental and leasing and technical services establishments of SMEs or large enterprises because either industrial

and drinking services classifications, number of regular employees or capital size is unknown. The Living-related and personal Real estate and goods Finance and insurance

Transport and postal activities number of medium enterprises is equivalent to the number of deducting small Accommodations, eating Information and communications Scientific research, professional Wholesale and retail trade enterprises from SMEs. The percentage of SMEs = number of SMEs/number of Medical, health care and welfare services and amusement Education, learning support all enterprises×100. Note: Industry divisions which have 10,000 establishments or more are listed. Source: MIC, METI “Economic Census for Business Activity” reorganized by TMG Source: MIC “Economic Census for Business Frame” Bureau of Industrial and Labor Affairs

4 Industry and Employment in Tokyo - A Graphic Overview 2017 Tokyo's Economic Base and Characteristics Acceleration of Demographic Aging

2 Growth of Gross Prefectural Domestic Product in Tokyo 3 Tertiary Industry Accounts For About 90% of is Expected to be Negative for Three Consecutive Years Gross Prefectural Domestic Product in Tokyo

Gross prefectural domestic product in Tokyo Gross prefectural domestic product (nominal) by economic year-on-year growth rate activity and percentage of the tertiary industry (Tokyo) (Real, Chain-linked method) (Tokyo) (Trillion yen) (%) Percentage of tertiary industry (right axis) 110 87.9 88.7 88.7 90 (%) 100.2 3 100 95.0 95.5 80 6.4 90 Producers of government services 5.9 5.9 2.1 2.0 70 2 19.9 80 20.0 20.4 1.2 Service activities 60 70 1 0.4 0.5 11.3 60 Information and communications 11.6 11.8 50 0 Transport 50 11.2 40

Tertiary industry Real estate 12.3 12.4 -0.3 40 11.7 30 -1 -0.7 Finance and insurance 9.0 8.9 -1.1 30 20 20.9 Wholesale and retail trade -2 20 18.8 18.4 -2.7 10 10 Construction -3 7.8 Manufacturing 6.5 6.3 0 2007 08 09 10 11 12 13 14 15(FY) 0 Agriculture, forestry and fishing Mining -4 -3.8 Manufacturing Construction Electricity, gas and water supply Wholesale and retail trade Finance and insurance Real estate -5 Transport Information and communications 2007 08 09 10 11 12 13 14 15 16(FY) Service activities Producers of government services Producers of private non-profit services to households

Note: Taxes and duties on imports, and deduction of consumption taxes for gross capital Note: Figures for FY2015 are preliminary and fi gures for FY2016 are estimates. formation are excluded. Figures for FY2015 are preliminary. Source: TMG “Annual Report on Prefectural Accounts”, “Annual Report on Prefectural Source: TMG “Annual Report on Prefectural Accounts”, “Annual Report on Prefectural Accounts, preliminary and estimated” Accounts, preliminary and estimated”

6 As Demographic Aging Progresses, Population 7 Compared with Other Countries in the World, Composition by Age Drastically Changes Rate of Aging is High in Tokyo

Population pyramid by age and sex (Tokyo) Population aging rate by country and region (worldwide)

90 years old Male and over Female （％） 85-89 40 2040 80-84 Estimates (Estimates) 36.1 75-79 35 年齢別・男女別人口ピラミッド（東京） 70-74 31.3 男性 90歳以上 26.6 Japan 女性 30 30.8 65-69 85～89 29.3 2040年 60-64 80～84 Germany （推計） 22.7 Tokyo 26.0 55-59 25 75～79 24.6 2015 70～74 23.8 50-54 65～69 23.8 21.9 45-49 20 60～64 Sweden 55～59 40-44 2015France年 50～54 35-39 45～49 USA 15 UK 30-34 40～44 35～39 China 25-29 10 30～34 20-24 South Korea25～29 5.7 15-19 20～24 5 15～19 1980 10-14 1980年 3.8 10～14 5-9 5～9 0 0～4 0-4 1960 65 70 75 80 85 90 95 2000 05 10 15 20 25 30 35 40 75 35 0 0 35 75 75 35 0 0 35 75 （万人） (10,000 persons) Note: Population aging rate is the percentage of the population aged 65 and over in the total population. Figures for Japan and Tokyo before 2015 are the actual values based on the“Population Census”. Figures for Tokyo from 2020 and later are estimates by the Offi ce of the Governor for Policy Planning of TMG. Figures for Japan from 2020 and later are estimates by using the results of “Population Census 2010” as the standard population and do not link to the Note: Figures before 2015 are actual values based on the "Population fi gures in 2015. All fi gures of the other countries are estimates. Census". Figures for 2040 are estimates by the Office of the Source: MIC “Population Census”, National Institute of Population and Social Security Governor for Policy Planning of TMG. Research “Population Projection for Japan”, TMG “Tokyo 2020 action plan”, Source: MIC“Population Census”, TMG“Tokyo 2020 action plan” UN “World Population Prospects”

Industry and Employment in Tokyo - A Graphic Overview 2017 5 Overview of Tokyo’s Economy Both People and Products Mingle and Globalization is

1 Tokyo Attracts Foreign-Affiliated Companies 2 Companies in Tokyo are Actively Expanding Overseas

Number of foreign-affiliated companies by nationality of Number of overseas affiliates by its parent company (nationwide, 2016) located region (nationwide)

(Companies) Composition ratio of number Composition ratio of number of foreign-affiliated companies of overseas affiliates (%) 1,400 by prefecture (2016) by prefecture (FY 2014) Others Chiba Others 19.8 1.4 7.2 (%) Shizuoka 3.0 1,178 Total in Tokyo Japan 1,200 Hyogo 2.5 (1,000 companies) Kanagawa 4.9 50.4 24,011 Osaka 3.9 Aichi 9.2 30 Osaka 1,000 Kanagawa 12.7 8.5 Total in Japan Tokyo 25 23.9 24.0 3,158 76.6 800 2.1 2.1 2.8 2.8 20 Other Asia Other s 3.2 3.2 600 15.0 Europe 1.4 15 1.4 1.3 2.7 2.7 2.4 North America 400 357 10 2.7 NIEs 3 4.0 4.2

220 Asia 203 1.9 ASEAN４ 200 169 146 107 5 2.6 87 7.8 7.6 China 3.6 0 0 2004 05 06 07 08 09 10 11 12 13 14(FY) UK USA China France Note: Figures are as of each FY end. ASEAN4: Malaysia, Thailand, Indonesia, Germany Philippines. NIEs3: Singapore, Taiwan, South Korea. “Overseas affiliate” Switzerland Netherlands South Korea is the collective term of an overseas subsidiary (a foreign company with at least 10% investment from the Japanese investors) and an overseas sub- subsidiary (a foreign company with at least 50% investment from overseas subsidiaries with at least 50% investment from the Japanese investors). Note: In case there are more than one parent companies, all of them are counted. Source: METI “Basic Survey on Overseas Business Activities”, Prepared by TMG Top 8 countries are listed. Bureau of Industrial and Labor Affairs based on RESAS (Original data: Source: Toyo Keizai Inc. “Foreign Affi liated Companies in Japan: A Comprehensive Reorganizing and processing METI “Basic Survey on Overseas Business Directory” Activities”)

3 Exports and Imports Value at Port of 4 Total Exports and Imports Value at Port of Tokyo Turns to Decline Tokyo is the Second Largest in Japan

Exports and imports value by country Exports and imports value by port (nationwide, 2015) and region (Port of Tokyo)

(Trillion yen) (Trillion yen) (Trillion yen) 12 10 8 6 4 2 0 0 2 4 6 8 10 12 14 5.0 2006 7.0 12.6 Export Import 12 11.4 11.5 5.6 07 7.7

5.4 08 8.0 10 8.9 Export Import 3.6 09 6.6 8 7.5 4.6 10 7.5 6.2 6 5.6 5.4 5.3 5.0 4.7 11 8.1 4.6 4 3.9 3.6 4.7 12 8.5 3.3 3.4 2.4 2.7 5.5 13 10.0 2 1.6 1.0 0.6 6.1 14 11.0 0 6.2 15 11.4

5.8 16 10.6 Narita Airport Port of Tokyo

USA EU China Asia (except China) Middle East Others Port of Osaka Kansai Airport Port of Mikawa Port of Kawasaki

Note: Values for 2016 are preliminary. Hong Kong is not included in China. Note: Top 10 by exports and imports value are listed. Source: MOF“Trade Statistics of Japan” Source: MOF“Trade Statistics of Japan”

6 Industry and Employment in Tokyo - A Graphic Overview 2017 Tokyo's Economic Base and Characteristics Expanding in Tokyo

5 In Recent Years, Number of Foreign 6 Tokyo Wards Area Hosted 6th Highest Number Visitors to Japan is Drastically Increasing of International Meetings in the World

Number of foreign visitors to Japan Number of international meetings by city (worldwide) by country and region (nationwide)

(10,000 persons) (Meetings) 2,600 1,000 2,403.9 2,400 900 2,200 398.0 Australia 1,973.7 800 2,000 Singapore 736 1,800 Thailand 333.4 124.3 700 665 183.9 1,600 600 Brussels 103.3 1,400 416.7 152.4 500 494 1,200 Tokyo wards area 367.7 Paris 1,000 400 363 362 Vienna 509.0 308 733.4 Hongkong 316 800 300 USA 298 Seoul 249 160.6 400.2 242 600 Others Barcelona 81.7 200 215 400 130.9 Geneva 187 Taiwan 637.3 Berlin 499.4 100 172 200 211.7 South Korea 58 81.2 China Bangkok 0 2006 07 08 09 10 11 12 13 14 15 16 0 2006 07 08 09 10 11 12 13 14 15

Note: Top 7 countries and regions in 2016 are listed. Figures for 2016 are estimates. Note: Top 10 cities by number of international meetings in 2015 are listed. Source: JNTO materials Source: JNTO materials

7 At Haneda Airport, Number of International Flight Passengers and Volume of Air Handled are Increasing Every Year

Number of passengers and volume of cargo handled (Haneda Airport) Composition ratio of number of passengers and Number of passengers Volume of cargo handled volume of cargo handled by airport (nationwide, 2015) (Million persons) (10,000 tons) (%) 80 0 20 40 60 80 100 75.3 120 Number of passengers 72.7 108.8 International flights Kansai 70 103.5 Narita International 66.8 73 Million International 17.4 6.4 5.9 6.8 100 Persons 38.2 22.1 60 Chubu International

80 Domestic flights Other airports 72.0 50 204 Million Haneda 30.6 9.0 8.1 7.8 34.0 62.5 75.6 7.1 Persons 62.2 76.6 40 60 New Chitose Osaka International

65.0 (%) 30 0 20 40 60 80 100 Volume of cargo handled Domestic flights 40 Domestic flights 71.4 Kansai 20 International flights Narita International 58.2 International 9.5 4.9 33.2 3.50 million tons 19.9 20 5.1 10 26.9 International flights International flights 10.6 12.8 0.6 0 1.8 0 Domestic flights Naha Fukuoka 2007 08 09 10 11 12 13 14 15 2007 08 09 10 11 12 13 14 15 Haneda 41.7 13.9 1.81 million tons 12.3 11.3 10.9 7.2

Note: For the composition ratio, top 6 airports are listed. Source: MLIT“Airport Management Report”

Industry and Employment in Tokyo - A Graphic Overview 2017 7 Overview of Tokyo’s Economy As Finance and R&D Support Functions are Accumulated,

1 Deposits and Loans are Accumulated in Tokyo 3 Universities and Research Institutes are Accumulated in Tokyo

Composition ratio of deposit and loan Composition ratio of institutes related to research and by prefecture (nationwide, 2016) intellectual property by prefecture (nationwide)

（％） (%) 0 20 40 60 80 100 0 20 40 60 80 100

Number of Aichi universities 17.6 7.1 6.4 4.8 Others 59.3 Osaka 777 Deposits Tokyo 35.0 8.3 4.9 Others 42.7 764.4 trillion yen 5.3 3.8 Hyogo 4.8

Number of scientific Ibaraki Kanagawa Saitama and development Kanagawa 4.9 research institutes 17.2 7.4 59.8 6,633 5.9

Hokkaido 4.8

Loans 42.4 7.9 4.0 3.8 38.1 2.6 Number of Osaka 474.0 trillion yen 3.8 patent attorneys Tokyo 54.9 15.1 7.2 5.1 15.1 10,890

Aichi Fukuoka

Note: Number of universities is as of May 1st, 2016. Number of scientific and Note: Figures for deposits and loans are as of end of December (in domestic development research institutes is as of 2014 (including establishments banking books). Resolution and Collection Corporation and Japan Post owned by national and local governments). Number of patent attorneys is as Bank are excluded. Offshore accounts are not included. Deposits include of end of 2015. negotiable certifi cates of deposit. Top 5 prefectures are listed. Source: MEXT “School Basic Survey”, MIC “Economic Census for Business Frame”, Source: BOJ “Deposits and Loans Market” Japan Patent Offi ce “Annual Report”

2 Tokyo is Ranked No.5 in the World as 6 IT Related Businesses Account for About 60% Global Financial Centre of Investment Destinations of Venture Capitals Global International Financial Centres Index (worldwide) Investment of venture capitals by industry sector (persentage of overall investment) 850 (nationwide, FY2015)

806 800 London 795 (%) 794 787 New York Products and Services 750 Hong Kong 752 748 734 Singapore 720 16.4 719 700 697 Boston Industrials / Tokyo Energy / 15.7 673 San Francisco Other industries 650 57.9 IT related

625 10.0 621 608 Biotechnology / 600 2007 08 09 10 11 12 13 14 15 16 Medical / Healthcare

Note: Top 7 cities in 2016 are listed. Figures are as of September each year. This is an index taking the related data and the results of hearing investigation to financial market participants into account, with regard to the five fields: “Business environment”, “Development level of financial industry”, “Infrastructure”, “Human capital” and “Reputation”. Source: Z/Yen Group “Global Financial Centres Index” Source: VEC“VEC YEARBOOK2016”

8 Industry and Employment in Tokyo - A Graphic Overview 2017 Tokyo's Economic Base and Characteristics As Finance and R&D Support Functions are Accumulated, Tokyo Can Be Expected to Collaborate with Growing Sectors

4 Japan is No. 2 in the World in Terms of Number 5 R&D Expenditures of Japan is No. 3 in the World of International Patent Applications by Residents

Number of PCT international patent applications Gross domestic spending on R&D by applicants' country of residence (worldwide) and ratio to GDP (worldwide, 2014)

(1,000 applications) (billion dollars) (%) 70 500 5 Ratio to GDP (right axis) 450 432.6 4.3 60 57.4 400 4 3.6 344.6 50 350 USA 3.0 300 46.9 44.2 2.7 3 2.9 40 250

Japan 200 2.3 1.7 2 2.0 159.2 30 29.8 1.3 24.9 150 China 99.6 1.2 100 72.8 1 20 Germany 54.3 16.0 18.1 41.5 38.2 50 30.2 25.4 South Korea 14.6 0 0 10 France

8.5 UK Italy USA China Japan Russia 5.3 France

2.5 UK Germany 0 2005 06 07 08 09 10 11 12 13 14 15 South Korea Chinese Taipei

Note: Top 7 countries in 2015 are listed. Figures for 2015 are estimates. Note: Top 10 countries are listed. Figure in 2013 is used only for USA. Source: WIPO “Patent Cooperation Treaty Yearly Review” Source: OECD “Gross domestic spending on R&D”

7 Corporate R&D Expenditures in the Fields 8 Small and Medium-sized Manufacturers of Life Science, Information Technology and (SMM) are Expected to Expand Their Communications are High Businesses to Fields of Medical Care, Welfare and Nursing Care, Environment and Energy Expenditure on R&D by selected objective (nationwide) Business fields where SMMs desire to enhance or expand their businesses (Tokyo, 2015) (%) (100 billion yen) 0 10 20 30 35 Medical care, welfare and 28.2 nursing care related

30.3 Environment and energy 30 27.4 28.0 Life science related Agriculture, food and 18.0 25 biotechnology related Information technology 23.5 Health and sports related 13.8 20.9 20 Robot related 13.2

15 Infrastructure development 11.6 and maintenance related Environmental science and technology 12.0 Energy 10.6 Aerospace related 11.3 10 8.9 10.0 8.8 Nanotechnology Risk management and 7.7 7.7 disaster prevention related 5 Oceanology 5.3 2.4 Space exploration 2.6 Nanotechnology related 1.0 1.2 Others 20.3 0 2005 06 07 08 09 10 11 12 13 14 15 (FY)

Note: R&D expenditures spent within organizations by enterprises with the capital Note: Multiple answers allowed. Only answers from companies who intend to of 100 million yen or more, nonprofit organizations and public institutions, enhance their businesses or extend those to new business fields were universities, etc. aggregated. Source: MIC “Survey of Research and Development” Source: TMG “Current Status of SMEs in Tokyo (Manufacturing Industry Edition)”

Industry and Employment in Tokyo - A Graphic Overview 2017 9 Overview of Tokyo’s Economy and Tokyo during 2016 as Seen

1 Indexes of Business Conditions has been Improving since October

Indexes of business conditions (nationwide) （2010 ＝100） 125 120 114.8 115 110 105 100 95 90 85 80 75 2000 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16

Note: CI: coincident index. The shadowed areas indicate recessions. December 2016 revised release. Source: CAO “Indexes of Business Conditions”

2 Real GDP Growth Rate has been Changing toward Positive

(%) GDP growth rate by quarter (nationwide) 10 Real

5 1.6

0 1.2

-5 Nominal

-10

-15

-20 Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ 2006 07 08 09 10 11 12 13 14 15 16

Note: Quarterly Estimates of GDP for Oct. - Dec. 2016 (The 2nd preliminary). Figures are seasonally adjusted annual rates. Changes from the previous quarter. Source: CAO “SNA (National Accounts of Japan)”

3 Nikkei Stock Average Turned Upward Over the Year End

(1,000 yen) Nikkei stock average (nationwide) 22 20.87 20 19.11 18

16

14

12

10 Closing price 8

6 2006 07 08 09 10 11 12 13 14 15 16

Note: Figures for the period from January 2006 to December 2016 are listed. Figures are daily closing prices. Source: Nikkei Inc. materials

10 Industry and Employment in Tokyo - A Graphic Overview 2017 Economic Trends of Tokyo in 2016 through Data

4 Production Indices Showed Decline for 5 Sales of Departmentstores Turned Downward 2 Consecutive Years

Production index Sales of departmentstores and supermarkets (Tokyo wards area) and convenience stores (greater Kanto area), the number of new vehicles sold (Tokyo)

105 (%) 30 (Percentage changes from the previous year / from the same month of the previous year) 2016 2016 (2010 average = 100) 23.1

100.6 20

100 Convenience stores 99.9 98.3 10 Number of new 97.6 vehicles sold nationwide 4.1 97.8 97.6 3.5 3.7 3.1 4.0 95.2 1.7 3.0 0 - 0.5 95 1.7 0.2 0.0 -1.6 -2.1 -2.1 -1.2 94.3 Tokyo Departmentstores Supermarkets -10 2012 13 14 15 16 Jul Oct Jan Feb Apr Jun Dec Sep Mar Nov Aug May

90 2012 13 14 15 16 Jul Oct Jan Feb Apr Jun Dec Sep Mar Nov Aug May

Note: Figures for departmentstores and supermarkets are sales value of existing establishments, fi gures for convenience stores are of all establishments. The greater Kanto area consists of one metropolis (Tokyo) and 10 prefectures (Ibaraki, Tochigi, Gunma, Saitama, Chiba, Kanagawa, Niigata, Yamanashi, Nagano and Shizuoka). The number of new vehicles sold is the total number of passenger cars, compact cars, medium-duty trucks, small trucks and buses sold, and does not Note: Monthly values are seasonally adjusted. Values for Tokyo in December and include special vehicles, trailers and others unable to classify. 2016 represent preliminary fi gures. Source: METI “Monthly Report on the Current Survey of Commerce”, Japan Automobile Source TMG “Indices of Industrial Production”, METI “Indices of Industrial Production” Dealers Association materials

6 Trade Balance Recorded a Surplus for the 7 Number of Visitor Arrivals Exceeded First Time in 6 years 24 Million

Trade value (nationwide) Number of visitor arrivals and Japanese overseas travelers (nationwide)

(Percentage changes from the previous year / from the same month of the previous year) (%) (%) 60 20 (Percentage changes from the previous year / 52.0 3.8 from the same month of the previous year) 10 5.4 45 34.4 Visitor Arrivals 0 30 Value of exports 15.6 -2.7 -12.9 21.8 -10 -7.4 -2.6 15 8.8 5.6 3.3 8.0 -15.9 -20 -17.8 0 Value of imports -30 -15 Japanese overseas travelers

(10,000 persons) 2016 Visitor Arrivals (10,000 persons)

Value of exports 2,500 2,404 Japanese overseas travelers 250 (Trillion yen) 2016 (Trillion yen) Value of imports 6.7 205 90 7 2,000 200 6.0 6.0 1,849 185 1,712 75 70.7 70.0 5.4 6 63.7 66.0 5 1,500 146 150 60 128 4 45 1,000 100 3 836 Annual total Monthly value (right axis) 30 2 500 Annual total Monthly value (right axis) 50 15 1 0 0 0 0 2012 13 14 15 16 2012 13 14 15 16 Jul Jul Oct Oct Jan Feb Apr Jan Feb Apr Jun Jun Dec Sep Dec Sep Mar Nov Aug Mar Nov Aug May May

Note: The fi gures of visitor arrivals for December and 2016 are estimates. Note: The value of imports for 2016 and December are preliminary fi gures. Source: Japan National Tourism Organization (JNTO) “Visitor Arrivals & Japanese Source: MOF “Trade Statistics of Japan” Overseas Travelers”

Industry and Employment in Tokyo - A Graphic Overview 2017 11 Overview of Tokyo’s Economy Business Environment of the enterprises in Japan and Tokyo during 2016 as Seen through Data

1 Consumer Price Index Remained Almost 2 Corporate Goods Price Index Turned Upward Negative Compared with the Same Month of since November Services Producer Price the Previous Year Index has been on Upward Trend

Consumer price index Corporate goods price index and Services producer price index (nationwide) (%) 2.5 2.2 (Percentage changes from the same month 100.6 of the previous year) 101 2.0 2.2 1.5 100 2010-Base 2015-Base 1.0 99 Corporate goods price index 0.5 (2015 average =100) Nationwide -0.2 98 0.0 97.1 -0.5 Tokyo wards area 97 -1.0 -0.6 96 101.0 (2015 average = 100) 95

100.5 Services producer price index (Consumer price index) (2010 average = 100) 104 103.5 Tokyo wards area 100.0 99.8 103 99.5 102 99.5 Nationwide 102.2 99.5 99.4 101

99.0 100 Jul Jul Jul Jul Oct Oct Apr Apr Oct Oct Apr Apr Jan Jun Jan Jun Jan Jun Jan Jun Mar Mar Feb Feb Mar Mar Feb Feb Nov Dec Nov Dec Aug Sep Aug Sep Nov Dec Nov Dec Aug Sep Aug Sep May May May May →2015 →2016 →2015 →2016

Note: Fresh food is excluded. Source: BOJ “Monthly Report on the Corporate Goods Price Index”, “Monthly Report Source: MIC “Consumer Price Index” on the Services Producer Price Index”

3 Business Conditions Among SMEs Have been 4 Number of Corporate Bankruptcies has been alternating between growth and decline on the Decline Business conditions DI for Number of corporate bankruptcies SMEs by industry (Tokyo) Business conditions DI for (Percentage changes from the previous year / SMEs by industry (Tokyo) (%) from the same month of the previous year) 20 Tokyo 10 Manufacturing Wholesale trade Retail trade 1.5 -1.4 5.1 Services Total 0 -4.1 0 -6.3 -10 -4.7 -8.0 Nationwide -10 -20 -22.5 -30 -20 -21 -22

-30 -30 -33 (Cases) (Cases) -33 -36 15,000 Annual total 2016 (right axis) 1,200 -40 -39 -39 12,124 -46 1,000 -50 10,000 800 8,446 675 710 -55 600 -60 Nationwide 5,000 400 -70 2,470 2012 13 14 15 16 1,654 143 Tokyo 145 200 0 0 2012 13 14 15 16 Jul Oct Apr Jan Jun Mar Feb Nov Dec Aug Sep May Note: DI is calculated by the percentage of companies who answered that business conditions are “favorable” minus that of companies who answered Note: Bankrupt companies with liabilities of 10 million yen or more. “unfavorable”. “Total” is the total of the four industries. Source: TMG “Enterprise Bankruptcies in Tokyo” (researched by Tokyo Shoko Source: TMG “Business Conditions of Small and Medium Enterprises in Tokyo” Research, Ltd.)

12 Industry and Employment in Tokyo - A Graphic Overview 2017 Economic Trends of Tokyo in 2016 Employment environment of Japan and Tokyo during 2016 as Seen through Data

1 Unemployment Rate Continues to Improve 2 Active Job Openings-to-Applicants Ratio is on the Rise

Unemployment rate Number of active job openings and job applications, active job openings-to-applicants ratio

(Times) Active job openings-to-applicant ratio 2.5 (%) 2.01 Tokyo 2.06 2 1.90 5 Nationwide 1.43 1.5 1.08 1.29 4.5 1 0.80 1.36 0.5 0 4.3 4 Number of active job openings (Tokyo) 3.8 2016 Tokyo Number of active job applicants (Tokyo) (10,000 persons) 3.2 40 37.1 3.5 3.3 36.7 35.8 35

3 3.1 Nationwide 30 25.6 2.9 25 23.7 20 18.3 18.9 18.0 15 10 2 5 Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ 0 2012 13 14 15 16 2015 16 2012 13 14 15 16 Jul Oct Apr Jan Jun Mar Feb Nov Dec Aug Sep May

Note: Monthly values are seasonally adjusted. Source: MIC, TMG “Labour Force Survey” Source: MHLW, Tokyo Labour Bureau “Report on Employment Service”

3 Total Cash Earnings Tend to Move Almost 4 Total of Non-scheduled Working Hours are Changing Positive from the Previous Year within the Negative Scale from the Previous year Monthly total cash earnings Monthly non-scheduled hours worked

(Percentage changes from the previous year / (Percentage changes from the previous year / (%) from the same month of the previous year) (%) from the same month of the previous year) 3 6 2.1 3 1.0 2 0.4 Nationwide Nationwide 0 0.5 -0.8 -2.8 1 -3 -1.0 -1.8 -0.2 0.1 -4.3 0 0.1 0.0 -6 -5.8 -0.1 -9 -1 Tokyo Tokyo -1.1 -12 -2

(10,000 yen) (Hours) 2016 2016 80 14 70.8 Tokyo 12.0 Tokyo Nationwide Nationwide 12 11.3 11.2 11.0 11.2 10.5 11.2 60 10.0 54.7 10

41.2 40.7 8 40 34.3 31.7 31.4 6 26.9 4 20 2 0 0 2011 12 13 14 15 2011 12 13 14 15 Jul Jul Oct Apr Jan Jun Oct Apr Mar Feb Jan Jun Nov Dec Aug Sep Mar Feb May Nov Dec Aug Sep May

Note: Establishments with 5 employees or more. Note: Establishments with 5 employees or more. Source: MHLW, TMG “Monthly Labour Survey” Source: MHLW, TMG “Monthly Labour Survey”

Industry and Employment in Tokyo - A Graphic Overview 2017 13