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Home > Media Reiews > News Review Last Updated: 14:53 03/09/2007
News Review #111: March 11, 2003

So many business ideas for Japan, so few accepted

Reviewed By Hitoshi URABE

"So many business ideas for Japan, so few accepted",4386,175565,00.html
(By Kwan Weng Kin) The Straits Times


Mr Koizumi, when came into office as the Prime Minister, floated a whole bunch of ideas, to impress people of him as a reformer. The ideas varied in scale and feasibility, some even unrealistic, but they were explained to be for people to grasp an image of his aims to reform.

Among the ideas was to form special deregulated zones in various localities across the country. In each of the zones, certain regulations and restrictions would be lifted, so as to allow innovative activities to take place, which then could cultivate new businesses. It was a way to realize some of the precepts of Mr Koizumi's Reform, such as “from the government to the private sector" and "national to regional levels" who would be building facilities and providing services. It was also considered an effective policy to revive the economy by utilizing entrepreneurship of the private sector.

The article reports that as a result, only 30% of the applications submitted to form special zones have been accepted due to strong resistance by the bureaucrats to change. It then introduces an example where an application was made to allow for hospitals owned by privately invested stock companies to be run, which was denied. Currently hospitals must be operated by individuals who are qualified medical doctors. It is explained that because stock companies are interested only in making profits they cannot be entrusted to be responsible for peoples' health, and that it is not for the patients' benefit to be preyed upon for money making by stock companies.

The forces of the old guards refused many other applications. Daylight saving time was suggested by some localities seeking various benefits, but were rejected for the reason that it would confuse people. (It is interesting to note that the whole China lives in one time zone while in the US there are not only multiple number of time zones but adoption of daylight saving time differs from state to state.) Ownership of farmland by stock companies was also denied for somewhat similar reason as in the case of hospitals.

One perhaps most prominent example was the case of casinos. A number of localities wished to have one but none was permitted. The reason for the denial was reported to be that bureaucrats had a firm belief that Japanese people are too naive to be exposed to the excitement of such an obscene act like gambling.

A critic commented that Japan is a country officially run under the rules of capitalism but submitting to the ideals of socialism based on the notion that making money or creating wealth is evil. It is interesting if not scary that there seems to be some truth in this comment. In addition, the answer to the question asked many times, that why Japan could never carry out a reform is vividly illustrated in this exercise of special deregulated zone.

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