NCPA - National Center for Policy Analysis

Regional Reform

December 22, 2003

The establishment of Special Zones for Structural Reform could revitalize the ailing Japanese economy. The reform zone initiative, which has been introduced in various municipalities throughout Japan, is aimed at accelerating deregulation as part of Prime Minister Koizumi Jun'ichiro's reform initiatives, according Asia-Pacific Perspectives (APP).

Under this plan, various economic sectors are exempted from certain regulations within designated districts. So far, 164 special zones have been created.

The reforms have two objectives:

  • Encourage the creation of industry clusters, and of new industries that draw on local characteristics, with the ultimate goal of spurring local economies.
  • Expand deregulation nationwide based on successful cases of regulatory reform at the local level.

Since its implementation, successes have followed in foreign language education, information technology, winemaking and advanced medical technology.

The system represents a conceptual change from public to private and from national to regional. It is testament to the teachings of the classical liberalists on the limited role of government and the power of the free market, says APP.

Source: "Regional Reform," Asia.Pacific Perspectives, November 2003.


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