At E3 yesterday, series creator Tetsuya Nomura affirmed that the basic framework for Kingdom Hearts III is nearly finished! "For the most part," he said, "we've established the foundation—the basic system and mechanics of what's going to go into the game. The development of that is close to complete."

He then further clarified what that means:

It's good to hear that production of the game is going smoothly, even if more slowly than we may like. Thinking back on how gorgeous the new E3 trailer was, imagine how it'll look when polished to that final state! [swoon~]

Source: GamesRadar