It is never easy for Japan, a resource-poor country, to occupy an honorable position in human society. In fact, the country’s future prosperity depends on the development of unique, outstanding S＆T. With this understanding, Japan set the goal of “becoming an advanced science-and technology-oriented nation ” as a national strategy. The Science and Technology Basic Law has been enacted, under which a comprehensive range of measures has been taken intensively based on the Science and Technology Basic Plan （hereinafter “Basic Plan ”）, including the “First Basic Plan ” for FY1996-2000, and the “Second Basic Plan ” decided by the Cabinet in March 2001 and scheduled for implementation during FY2001-2005.

 The first and second basic plans were formulated and carried out during the period of prolonged economic stagnation in Japan following the collapse of the bubble economy. Even in the deteriorating financial circumstances, governmental R＆D expenditure increased, and a broad range of structural reforms were conducted such as: strategic priority setting in S＆T through promotion of basic research and prioritization of R＆D on national/social issues; development of a competitive R＆D environment by increasing competitive funds and reforming existing systems; and reorganization of national research institutes and national universities into corporations.

 At this time of formulation of the third basic plan, the Japanese economy has finally recovered from the prolonged stagnation and started to show signs of shifting to a sustainable growth path. In S＆T, also, policy efforts have been made persistently based on the first and second basic plans. As a result of these efforts, world-leading research papers and findings emerged, and some of the advanced findings have been turned into innovative industrialization. The competitiveness of the private sector is based on national S＆T capability. In light of this, both effective increase of R＆D expenditure and thorough execution of R＆T system reforms during the period of the third basic plan （FY2006-2010） will be indispensable for the long-term development of the Japanese economy.

 Of course, people expect much more than economic contributions from Japan’s S＆T in the third basic plan. They also expect: contribution to society, which is changing remarkably due to rapidly aging population and declining birth rate; resolution of safety issues relating to public concerns about large-scale natural disasters and accidents, as well as complicated global security issues including terrorist attacks; and resolution of deteriorating global-scale problems concerning population and the environment, etc. Thus, the society expects S＆T to play more extensive and profound roles. Moreover, the world never stops in making progress in S＆T. China, South Korea, and other Asian countries, as well as the U.S. and European countries are rapidly coming to enhance S＆T as a basis of national strength.

 In order to use investments accumulated during the period of the previous two plans and also to meet increasing social and economic needs in various fields, the third basic plan should further enhance accountability and strategies, aiming at S＆T to be supported by the public and to benefit society. The core strategies of the third plan are: development of human resources who can produce excellent research findings, creation of a competitive environment, promotion of science, and creation of persistent innovations through strategic investment; and removal of systematic or operational obstacles to return the R＆D benefits to society. S＆T has a mission to address a broad range of these policy issues for the next five years. With this basic understanding, the third basic plan intends to indicate primary measures to be executed steadily by the government as a whole with the leadership of the Council for Science and Technology Policy.