Japanese trading house Mitsui and telecom operator KDDI have launched a company to develop digital platforms for so-called smart cities.

The project will offer a platform for municipalities and businesses to develop next-generation transportation systems and commercial facilities.

The companies say it can be used to operate self-driving buses and optimize customer traffic.

An executive vice president of Mitsui says the project offers tremendous growth potential as it can be used anywhere in the world. Kometani Yoshio says any major city could be a candidate. He says he expects to market to grow rapidly once the technology is developed.

"Smart cities" use cutting-edge technology to make communities more energy-efficient and improve quality of life.

Mitsui and KDDI have already worked together to develop a system that monitors and predicts the movement of people using location data and AI technology.