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The Fast Train to Kanazawa

The expanding national network of Shinkansen lines continues to boost local economies.

Since the Tokaido Shinkansen line began operations between Tokyo and Osaka in 1964, other lines connecting cities throughout Japan have been developed. The Shinkansen lines are a very important part of the basic infrastructure and are a stimulus to Japan’s economy. For example, the number of passengers on the Tokaido Shinkansen line was about 11 million in the first year of its operation and after ten years it exceeded the 100 million mark. As the number of businesspeople making day trips between Tokyo and Osaka increased sharply, the Tokaido Shinkansen line provided a backbone for Japan’s high economic growth.

The Shinkansen network continues expanding. In 1975, the entire route of the Sanyo Shinkansen line (Shin-Osaka to Hakata) opened. In June 1982, the Tohoku Shinkansen line opened. In March 2011, the entire route (Hakata and Kagoshima-Chuo Stations) of the Kyushu Shinkansen line (Kagoshima route) opened. In March 2015, the Hokuriku Shinkansen line opened between Nagano and Kanazawa Stations. Most recently, in March 2016, the Hokkaido Shinkansen line opened between Shin-Aomori and Shin-Hakodate-Hokuto Stations. More than 2,000 km, from Kagoshima-Chuo Station in Kyushu to Shin-Hakodate-Hokuto Station in Hokkaido, is now connected by Shinkansen lines.

With the extension of the Hokuriku Shinkansen line to Kanazawa, the travel time between Tokyo and Kanazawa is 2 hours and 30 minutes at the shortest. In the first year of the Hokuriku Shinkansen line’s operation, 9.26 million passengers used the line from Nagano Station to Kanazawa, which is about three times the number of passengers (3.14 million) when limited expresses on the regular railway were used. The economic ripple effect is said to have been 67.8 billion yen in one year.

“Among the nine regions of Japan, we think that the Hokuriku region (Toyama, Ishikawa and Fukui Prefectures) has the second best economy after the Tokai region (Shizuoka, Aichi, Gifu and Mie Prefectures). The first reason is the impact from the opening of the Hokuriku Shinkansen line. The second reason is the concentration of companies there increasing production due to growing domestic and global demand for electronic parts, devices for smartphones and generic drugs,” says Hironobu Matsuo, chief manager of the Kanazawa Branch of the Bank of Japan. “The economic impact of the Hokuriku Shinkansen line is huge. Tourism since the Hokuriku Shinkansen line’s opening in 2015 has grown at record high levels of 15.6% in Toyama, 15.8% in Ishikawa and 12.3% in Fukui, although the Hokuriku Shinkansen line still is not connected to Fukui Prefecture. The growth rate was slightly lower in the second year, but remained higher than before. We believe that positive growth will continue in the Hokuriku region.”

The number of overseas tourists to the three prefectures in the Hokuriku region has been increasing rapidly. Those that stayed there increased to 674,000, up 41.9% in one year, in 2015, and to 785,000, up 24.5%, from January to November 2016. In 2016, JR East and JR West started to issue the Hokuriku Arch Pass (a discount, unlimited-ride train pass for travel from the Tokyo Metropolitan area and Osaka area to the Hokuriku region) for foreign tourists. Because of it, the number of foreign tourists to the Hokuriku region is expected to increase further.

Following this trend, new hotels are currently being constructed rapidly in the three prefectures of the Hokuriku region. In particular, since the capacity of hotels in Kanazawa has already reached its limit, new hotels are planned and the number of rooms in Kanazawa will increase by 20%. In a certain hot spring resort, a local inn has been renovated with capital from outside the region. At the Ohmicho Market in the center of Kanazawa, which sells local fresh food, the number of tourists has also been increasing rapidly since the opening of the Hokuriku Shinkansen line.

“The economic effect of the opening of the Hokuriku Shinkansen line is now in its second phase, during which a variety of construction investments and M&A investments have begun,” says Matsuo. “The Hokuriku region is currently attracting attention in terms of the BCP (Business Continuity Plan) as an area where the risk of major disasters is low compared with the Pacific side of Japan. Some companies have already started moving part of their headquarters or production bases.”

The opening of the route between Kanazawa and Tsuruga (Fukui Prefecture) of the Hokuriku Shinkansen line is scheduled for 2023. The Hokuriku Shinkansen line will eventually be connected to Osaka around 2046.

“The importance of the Hokuriku Shinkansen line will certainly increase as an alternative to the Tokaido Shinkansen line,” says Matsuo. “Redevelopment is occurring around the main stations in the three prefectures of the Hokuriku region, and when the Hokuriku Shinkansen line is connected to Osaka, the commutation area will be expanded and the Hokuriku region will be more closely linked to the Kansai region. We don’t know the specific ripple effects now, but the Hokuriku Shinkansen is the engine of growth of the Hokuriku region and the further development of the Hokuriku region is expected.”