Shokusan-kogyo (encouragement of new industries) (殖産興業)
Shokusan-kogyo is the policies in which the Meiji government accelerated modernization of the nation by encouraging industry and nurturing capitalism in order to compete with Western countries.
Japan, opening its country to the world in the late Edo period, became conscious of the overwhelming national power of Western countries. The new Meiji government, established by the Restoration of Imperial Rule in Japan, adopted a policy to promote industries actively, under the slogan of "Fukoku-kyohei" (enriching the country and strengthening the military). The government carried out a tax reform through the land-tax reform and Chitsuroku-shobun (measure to abolish hereditary stipend), and imported industrial technology by establishing the Ministry of Industry in 1870, hiring many people from Europe and sending students abroad in conjunction with the Iwakura Mission that was sent to Europe. The domestic transportation system were developed due to the inauguration of the government-owned railway and steamship in 1872. Also, the government undertook such workings as developing mines, and established government-owned factories including Tomioka Silk Mill in Gunma prefecture. In 1873, the prewar Ministry of Home Affairs was established in order to supervise national projects. The government located the Development Commissioner to Hokkaido, and sent ex-legionary there. About financial system, the government proclaimed the New Currency Regulation in 1871 and the Regulation of National Bank in 1872.
In 1880, national projects were sold to private companies including the Mitsui combine and the Mitsubishi combine, and the Ministry of Industry was abolished in 1885. In 1882 the Osaka trading company was founded to establish spinning industry and then industrial revolution in Japan was proceeded after the Sino-Japanese War and the Russo-Japanese War.
In private companies, Mitsubishi, which was founded by Yataro IWASAKI, and Mitsui became businessmen with political ties, under the protection of the government. These process urged the formation of Zaibatsu (a financial combine).