Like many developed economies, Japan is facing an ageing society, with demographic shifts away from the countryside towards a small number of cities and their surrounding regions. However, in Japan, the shifts have been more dramatic than in most societies, and the consequent challenges are currently greater than those facing most developed economies.

These major shifts in Japan’s society have left large swathes of the country, and smaller cities, increasingly depopulated as economic and social activity concentrates around a small number of major metropolises and surrounding districts. This poses major challenges for both the growing metropolises and the depopulated regions. The metropolises must manage rapid urban expansion and increased demand across ever larger geographies, while dealing with constrained budgets and workforces. For the depopulated regions, the challenge is even more severe. They must support hollowed out populations that are disproportionately ageing, with far smaller workforces, reduced economic activity and shrunken local tax bases. In some regions, the proportion of the elderly has reached 65%.

In response, the Japanese Government has launched the Super Cities Initiative (SCI). The SCI is a national strategy for regulatory transformation and integration of the latest digital technologies to address Japan’s structural economic and demographic challenges. These technologies include AI, Big Data and IoT.

Early Realisation of Future Society

The Government has officially designated the project as the “Early Realisation of Future Society”, with a target date of 2030 for realisation.

In addition to providing a national mechanism for funding transformation of cities and regions, the SCI provides a legal foundation under the “National Strategic Special Zone Law (NSSZL)”. This is a legislative framework that grants designated municipal areas the authority to bypass traditional bureaucratic procedures.

The primary function of the NSSZL is to expedite comprehensive regulatory reform simultaneously across multiple ministerial jurisdictions, removing long-standing administrative impediments that have hampered digital transformation efforts. This approach positions the SCI as a regulatory sandbox strategy. It recognises that legacy regulatory friction, such as the problem of siloed agencies and fragmented jurisdictions, can be more obstructive than a lack of technology and must be resolved before large-scale digital innovation can succeed.

Society 5.0 National Testbeds

The SCI establishes national testbeds to serve as laboratories for the national strategic vision, known as Society 5.0. Society 5.0 envisions blurring the frontier between cyberspace and physical space to transform the Japanese way of life and economy.

The SCI’s designated cities are intended as vanguards for this transformation. They are intended to prove that sophisticated technology and comprehensive deregulation can combine to solve acute societal problems. To qualify for designation, cities must commit to deploying cutting-edge services across at least five of nine essential sectors of civic life, including Mobility, Healthcare and Nursing Care, Education, and Administration. The initial primary pilot projects, designated in April 2022, are Tsukuba City in Ibaraki Prefecture and Osaka City/Osaka Prefecture.

The Government of Japan allocated $225 million in FY2025 through the Cabinet Office to promote advanced smart city technologies. This funding supports core SCI activities and related initiatives, such as related healthcare modernisation projects in designated Digital Garden Healthcare Special Zones.

The SCI is managed primarily by the Cabinet Office (CAO), Government of Japan. Oversight falls specifically under the Cabinet Office’s Secretariat for Promotion of Regional Revitalisation. This organisational structure, placing the initiative under the highest executive coordination body (the CAO) rather than a single sector ministry, aims to ensure the initiative carries the necessary political authority to enforce horizontal cooperation across traditionally siloed ministries, which is vital for enabling cross-sectoral data linkage and regulatory change.

While the CAO leads the strategic direction, implementation involves multiple agencies. The Ministry of Internal Affairs and Communications (MIC) and the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) are among the ministries engaged in supporting the advancement of smart city technologies in each city and region.

City Operating Systems

A central component of the SCI vision is the data linkage platform, often referred to as a “City Operating System” (City OS). This standardises how data is collected, shared, and used across siloed city departments, central government entities, companies, and citizens.

The platform concept implicit in the SCI strategy standardises the method of data governance across designated zones, intending to create a national technical standard that allows technologies and services developed in one Super City to be implemented in other municipalities with minimal modification. This mechanism ensures system interoperability and maximises the scalability of solutions across Japan.

Society 5.0 Smart Mobility

Modernisation of transport, which falls under the mobility sector, is mandatory for SCI designation. The initiative supports the development and deployment of autonomous vehicles and personal mobility solutions. In the Tsukuba City pilot project, regulatory reform has focused on use of personal mobility vehicles on sidewalks. Current policy limits the maximum speed to 6 km/h. The SCI proposal seeks to ease this restriction to 10 km/h, contingent upon the implementation of digital technology-based safety measures, such as speed control verified by location and proximity information.

The Tsukuba sidewalk regulatory reform typifies the SCI’s approach of employing quantifiable data provided by smart technology to overcome the risk-averse nature of traditional administrative decision-making.

Digital Garden Health Zones

Healthcare and nursing care constitute another mandated areas, directly targeting the consequences of the ageing population. Implementation focuses on expanding “Health and Life” through data utilisation. Key services include Online Medical Care, accessible “whenever, wherever”, typified in the Tsukuba City pilot project.

The government has also established “Digital Garden Health Special Zones” under the NSSZL framework. These are zones specifically tasked with using digital technology and regulatory reform to solve local health and medical issues, streamlining the application of telemedicine and remote care solutions.

The SCI mandates that service realisation must be achieved “from citizen’s perspectives and with citizen participation”. The Government has characterised its policy in this area as “Leave No One Behind.” Under this policy, digital inclusion is paramount, especially since the primary beneficiary population is frequently the elderly. Services deployed must explicitly address the challenge of social isolation in urban areas.

Digital transformation in public services includes high-impact changes such as “Internet Voting”, allowing online election voting “anytime, anywhere”, which has been proposed in Tsukuba City.

Addressing labour shortages under this policy is integrated through technology, such as the use of “Avatar Robots” in Tsukuba, intended to provide “Freedom to work anywhere,” aiming to mitigate geographic barriers and labour constraints. Education is also a core mandated sector.

Testbeds reflect a Diverging Japan

Two distinct areas have been designated as Super City-type National Strategic Special Zones: Tsukaba City and Osaka. The two reflect the different city experiences of a diverging Japan, split between provincial depopulation, ageing and growing strains on healthcare, and rapid urban expansion and strained city infrastructure. Tsukaba City represents the first type, while Osaka represents the second face of Japan’s demographic and societal crisis.

Tsukuba City, located in Ibaraki Prefecture, has a population of approximately 259,014 residents. Building on its position as a world-class science and technology hub, the “Tsukuba Super Science City Initiative” is planned as a citizen-centred testbed aiming to solve societal problems by combining academic knowledge with technological deployment.

Tsukuba functions primarily as the R&D and policy blueprint model for the Initiative. Projects include the Tsukuba Smart Mobility initiative and implementation of Internet Voting and Online Medical Care.

The city’s consortium, the Tsukuba Smart City Consortium, is a public-private platform bringing together universities, research institutions, businesses, and government agencies. Academic and research partners include the University of Tsukuba (which partners with the SMBC Group for proof-of-concept projects) , the Japan Aerospace Exploration Agency (JAXA) Tsukuba Space Centre, and several national research institutions focused on land, infrastructure, and disaster resilience. Industry partners include Hitachi and Sompo Japan Insurance.

Osaka City and Osaka Prefecture comprise a high-density, high-impact metropolitan area with a population of 8,772,171 residents. Osaka’s vision focuses on enhancing the city’s competitiveness and improving residents’ quality of life, mainly through intensive data utilisation in healthcare and mobility.

Osaka is focused on scaling and commercial viability. Its core infrastructure project is the Osaka Regional Data Exchange Network (ORDEN), built to realise data linkage across field data, regional data, and business data. Osaka is employing green-field development sites, such as Yumeshima (the venue for Expo 2025 Osaka, Kansai, Japan), and Umekita Phase 2, to quickly implement cutting-edge services.

Osaka’s academic ecosystem includes the new Osaka Metropolitan University, formed by merging Osaka Prefecture University and Osaka City University, tasked with establishing a joint platform to leverage public data analysis to solve urban challenges.

The selection of these two distinct sites, Tsukuba as the R&D and policy blueprint testbed and Osaka as the scaling and economic integration model, are aimed at enabling the government to validate rigorously the SCI mechanism across very different urban environments before nationwide deployment.