They say blue (“ao”) instead of green (“midori”) due to the way the language evolved.
International traffic regulations state the lights must be green, and when translated that was stated as blue due to this. Rather than change the laws, they just made the lights the most blue shade of green they could at the time.
Over time those lights have become rarer and most in Japan are now a pretty standard green.
I can say that this particular little linguistic foible caused some confusion when dating my wife (who had recently moved to the US from Japan) because she called the green lights blue in English.
