News On Japan

Japan to count sharing economy in official GDP

Aug 23, 2019 (Nikkei) - Japan will include sharing activities like Airbnb-style vacation rentals in gross domestic product calculations as early as fiscal 2020, Nikkei has learned, as the government seeks a better picture of the growing sector.

The Cabinet Office estimates that 80 billion to 100 billion yen ($751 million to $939 million) in such activity currently slips through the cracks.

The missing amount pales beside the overall nominal GDP of around 550 trillion yen. But the sharing economy is expected to continue growing in coming years.

GDP, which represents the total value created in a country over a set period, is a crucial metric of economic health. Certain aspects of the sharing economy, such as the roughly 50 billion to 60 billion yen in transaction fees paid to operators of flea market or room-sharing apps, appear to be already factored into GDP through the companies.

But this excludes value created by individuals. In the case of a private room rental -- minpaku in Japanese -- that would be the room's rate minus fees and other costs, such as for cleaning. Home-sharing legislation that took effect last year has given the government easier access to data on minpaku sales and other figures needed to capture the sector in GDP calculations.

The Cabinet Office has estimated Japan's sharing economy overall at about 630 billion yen 670 billion yen in 2017, up roughly 50% in a year. Such consumer-to-consumer flea market apps as Mercari, which has struggled to catch on abroad but is a major player in Japan, have shown particularly striking growth.

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