The government's top priority at the moment is to resuscitate the Japanese economy by stabilizing the shaky banking sector and pushing domestic business recovery through expanded governmental and consumer spending. At the same time, as the nation is poised to enter the 21st century, the urgent need to implement political, economic and social reforms cannot be overemphasized. This is particularly true because the lackluster performance of the Japanese economy in the 1990s can be largely attributed to the failure to restructure it to keep pace with the rapid globalization of the world economy.

Reforming the administrative structure can crucially influence successes in all these changes since a highly centralized bureaucracy continues to regulate Japan's economic and social activities. The fate of an outline for administrative reform adopted last week by the government, therefore, is a matter of great concern. The proposed reform of the central bureaucracy is designed to create a "simpler, more efficient and more transparent government" capable of dealing with various issues under stronger political leadership.

The reform is mainly aimed at strengthening Cabinet functions to establish political leadership in state affairs and at slimming down the government into a smaller number of ministries and agencies. The question is whether the government will succeed in decentralizing power, implementing further economic deregulation, disclosing more information, privatizing more government-backed enterprises and overhauling the central bureaucracy.