Press Conference by SUZUKI Shunichi, Minister of Finance and Minister of State for Financial Services

(Excerpt)

(Friday, January 19, 2024, 11:22 am to 11:34 am)

Q.

My question is about the new NISA program that started this January. The nontaxable investment limit has been significantly expanded and the period is now unlimited, which has encouraged many people to newly start the investments. In fact, there is a report that 100 billion yen has actually flowed into investment trust products, mainly overseas stocks, in a single day, showing its popularity. However, on the other hand, some point out that the outflow of funds to overseas stocks may be affecting the depreciation of the yen at the exchange market. I would like to ask the Minister's comment about the opinion that the investment in overseas stocks by the new NISA has contributed to the yen's depreciation. 

A.

With the new NISA program, which started this month, people are shifting from saving to investing, and from the perspective of diversified investment, I recognize that investment in not only domestic assets but also overseas assets is increasing.
With this background, regarding the relationship between the new NISA and the exchange rate, I am aware that there are views as you pointed out. However, the exchange rate is determined by various factors, such as economic and fiscal conditions at home and abroad, the international balance of payments, monetary policy trends, investor’s forecasts and sentiment. Therefore, I believe that it is difficult to generalize on the factors that cause this fluctuation, that is, to determine that such factors only result from the new NISA.
In any case, the government will closely monitor developments in the foreign exchange market.
It is also important to attract domestic and foreign investment into Japan and realize a virtuous cycle of growth and distribution. Therefore, we would like to promote efforts to realize Japan as a leading asset management center, including the establishment of an attractive financial and capital market in Japan as an investment target.

Q.

I would like to ask again, as I asked previously, about what the Compulsory Automobile Liability Council should be. The Compulsory Automobile Liability Council is the only council that discusses insurance matters, but the final report of the Sompo is not on the agenda at all even after it is released. I would like to ask the Minister's opinion about this. Car users are very angry that compulsory automobile liability insurance is used as a sales tool for the insurance industry. Another point is that in today's Council meeting, the secretariat said that compulsory automobile liability insurance is mandatory insurance with a high public nature, and that transparent discussion is necessary for proper operation. I believe that transparent discussion is exactly what the Council needs, and that you should not give certain direction through prior explanation to members. I would like to ask for your comments on these two points. 

A.

First of all, regarding the latter point, I am not aware of anything that the secretariat has said in advance.
Regarding the fact that the compulsory automobile liability insurance was used as a sales tool mentioned in the report as you pointed out, the Financial Services Agency is currently clarifying the actual situation while being fully aware of this problem, including what impact it had on this case, in the inspection and supervision response to Sompo Japan.
I understand that what you pointed out is that this issue should be discussed at the Compulsory Automobile Liability Council. However, the Compulsory Automobile Liability Council is supposed to deliberate on the appropriateness of the revision of the compulsory automobile liability insurance premium rate in response to a consultation from the Prime Minister based on the Automobile Liability Security Act, etc. According to the provisions of the law, I believe that the response to the fact you pointed out does not directly lead to the revision of the insurance premium rate. Therefore, I believe that it is not subject to deliberation of the Council.
However, with regard to the role and system of the Council, I think it is necessary to consider what to do for better management of the Council, and I would like to take this as one valuable opinion.

Q.

I would appreciate it if you would include the current issues in the discussion of the Council, please.