Dr. Hirofumi Kawakita’s plan to use the government’s newly created special structural reform zones to launch a pediatric emergency medical service in Tokyo soon led him into a Kafkaesque nightmare.

Kawakita proposed to officials on two separate occasions last year his plan to establish Suginami ER in Suginami Ward, Tokyo. But he was soon exhausted by the bureaucratic red tape involved in the application process for the much-touted special zone system, initiated by the administration of Prime Minister Junichiro Koizumi.

“There’s no use working with bureaucrats,” he said. “It’s a waste of time.”

The zone system was one of Koizumi’s showcase deregulatory projects. It was designed to transfer power from the state to local governments and the private sector.

Critics said resistance from government officials would probably cause the zone system to falter, like the privatization of four transportation-related corporations.

A headquarters to handle the promotion of special zones for structural reform was set up in the Cabinet Secretariat’s office in July 2002. It was tasked with establishing regulation-free zones for business areas such as international information and communications, physical distribution, finance, information technology, and farm enterprises.

After accepting proposals for projects from local governments and private-sector groups, the office then manages negotiations with ministries and agencies.

If government approval for deregulation is granted, the office would put the scheme into practice within the framework of either special or national zones.

Suginami Ward has a population of around 500,000 but lacks a 24-hour emergency medical center, making it an ideal candidate for such a service. Or so Kawakita thought.

Kawakita planned to work with an American doctor and employ technologies from the United States, an acknowledged forerunner in emergency medical care.

But bringing a foreign doctor into the picture caused shortness of breath among the government officials.

Officials of the Health, Labor and Welfare Ministry said Kawakita’s plan would be difficult to realize because the government would be unable to confirm the technical standards of a foreign-trained physician who is not licensed to practice in Japan and who would have difficulty communicating in Japanese.

Kawakita told the officials that the U.S. is more stringent than Japan in issuing licenses to physicians. He also told them that he would assign English-speaking doctors to bridge the language problem.

He pressed the officials to state why they were so apprehensive about the project. But they were vague and consistently refused to approve the plan, he said.

In the first application period in October 2002, 93 projects were OK’d for special zones and 111 for national zones.

In the application period last month, the sixth such period, six projects were approved for special zones and 27 for national zones.

The ambiguous attitude of ministry and agency officials has been blamed for blocking efforts at deregulation.

The city of Shiki, Saitama Prefecture, has submitted 31 decontrol steps. Seven have been approved.

Again, ambiguity was blamed. City officials accused the ministry and agency officials of deliberately failing to be explicit and called for a change in coordination to allow those who proposed the projects to join in discussions.

The Japan Business Federation (Nippon Keidanren), the nation’s most influential business lobby, said, “If proposals are highly likely to be rejected by government officials, the incentives to submit proposals will drop.”

At a meeting of the Council on Economic and Fiscal Policy late last year, Nippon Keidanren Chairman Hiroshi Okuda voiced concern about the fall in realized projects.

He said the state should have a mechanism to put decontrols into practice by selecting about 10 key items.

Koizumi did not comment. He told the council to continue working on the special zones.

Kawakita said Koizumi only acts on matters that interest him.

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