The Japanese government has approved a plan to create a second capital besides Tokyo. Why is it needed

Japanʼs parliament has approved a bill to create a second capital that could ensure the countryʼs governmentʼs operations are uninterrupted in the event of a natural disaster. In particular, the capital could be moved to Osaka, the countryʼs second largest city.

Nikkei writes about this.

The Japanese bill says the government will provide tax incentives to encourage businesses to move to the second capital and open government offices there. Tomoya Mori, a professor at the Kyoto Institute of Economic Research, believes there is no benefit to locating the second capital in Osaka. He added that artificial intelligence will allow businesses to work with fewer people and reduce the need for multiple offices, which will make corporate activity “inevitably concentrated in Tokyo”.

Osaka is home to Kansai International Airport and is a hub for the Shinkansen bullet train, which connects Tokyo with southern Japan. However, the media added that in 2025, 149 companies moved to Osaka, while 226 companies left. This is the 44th consecutive year that the city has seen a net outflow of companies. At the same time, 24.3% of the companies that left Osaka were located in Tokyo.

The media reported that the bill was passed thanks to an agreement reached in October between the ruling Liberal Democratic Party and the Japan Innovation Party. The political forces agreed on a concept for a second capital focused on decentralization and moving some government functions outside Tokyo.

• Japan is vulnerable to natural disasters due to its geographical location, the most common of which are earthquakes, tsunamis and typhoons. On March 11, 2011, the country suffered a triple disaster: one of the most powerful earthquakes, a tsunami and the accident at the Fukushima-1 nuclear power plant. The disaster killed more than 20 000 people in the country and displaced another 470 000.

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