Japan is still the world's second-biggest economy as fourth-quarter growth beat expectations and kept the country just ahead of a surging China.
Real GDP grew at an annual pace of 4.6 percent in the October-December period, the government said yesterday. The average forecast of 15 economists polled by The Associated Press was annualized growth of 3.4 percent.
The results indicate that Japan continues to benefit from government stimulus measures around the world, which have bolstered global trade and persuaded Japanese households to boost spending.
GDP, or the total value of the nation's goods and services, has climbed for three straight quarters. The annualized figure corresponds to quarterly growth of 1.1 percent. Japan posted zero growth in the July-September quarter.
Japan's nominal GDP for the 2009 calendar year came to about US$5.1 trillion. China said last month its domestic output totaled US$4.9 trillion.
Government officials said they were encouraged by the latest numbers, particularly since it was the first time in seven quarters for domestic demand to push GDP higher. Consumer spending, which accounts for about 60 percent of the economy, rose 0.7 percent from the previous quarter as shoppers took advantage of incentives on cars and home appliances.
Companies are also gaining confidence and starting to invest in factories and equipment.
Japan may now be strong enough to avoid falling back into recession, Kyodo News quoted Cabinet official Keisuke Tsumura as saying.
Analysts agreed but predicted that consumer demand would decelerate, dragging growth in the months ahead and putting pressure on Japanese Prime Minister Yukio Hatoyama to draw up more stimulus measures.
“Policy benefits will fade in subsequent quarters and deflationary tendencies remain stubborn,” said Tetsufumi Yamakawa, chief Japan economist at Goldman Sachs.
Corporate capital spending climbed 1 percent in the first expansion since January-March 2008. Public investment fell 1.6 percent, while exports jumped 5 percent.
The fourth-quarter figures cap a miserable economic year overall that sent Japan to its steepest recession since World War II. GDP fell a record 5 percent last year, the Cabinet said in a report.
Japan managed to hold on to its spot as the world's No. 2 economy, though analysts expect a quickly growing China to overtake it sometime this year.
But it is precisely the strength of China and other emerging markets in Asia that has lifted Japan from its downturn, helping to offset domestic risks such as deflation and falling wages.
Exports in December rose for the first time since the collapse of Lehman Brothers in late 2008, powering industrial production up 2.2 percent from the previous month.
Other major economies also face uncertainty ahead.
The US economy expanded at an annual rate of 5.7 percent in the fourth quarter, but many analysts predict a slowdown this quarter as double-digit unemployment chills consumer spending.
The 16 countries that use the euro barely grew in the fourth quarter, as a modest recovery stalled amid turmoil in financially troubled members such as Greece and a flat performance from Germany, the biggest euro economy.
Also See: Asian trading sluggish as markets fret about Greece
Taiwan has arranged for about 8 million barrels of crude oil, or about one-third of its monthly needs, to be shipped from the Red Sea this month to bypass the Strait of Hormuz and ease domestic supply pressures, CPC Corp, Taiwan (CPC, 台灣中油) said yesterday. The state-run oil company has worked with Middle Eastern suppliers to secure routes other than the Strait of Hormuz, through which about 20 percent of the world’s oil and liquefied natural gas typically passes, CPC chairman Fang Jeng-zen (方振仁) said at a meeting of the legislature’s Economics Committee in Taipei. Suppliers in Saudi Arabia have indicated they
A global survey showed that 60 percent of Taiwanese had attained higher education, second only to Canada, the Ministry of the Interior said. Taiwan easily surpassed the global average of 43 percent and ranked ahead of major economies, including Japan, South Korea and the US, data from the Organisation for Economic Co-operation and Development (OECD) for 2024 showed. Taiwan has a high literacy rate, data released by the ministry showed. As of the end of last year, Taiwan had 20.617 million people aged 15 or older, accounting for 88.5 percent of the total population, with a literacy rate of 99.4 percent, the data
CCP ‘PAWN’? Beijing could use the KMT chairwoman’s visit to signal to the world that many people in Taiwan support the ‘one China’ principle, an academic said Chinese Nationalist Party (KMT) Chairwoman Cheng Li-wun (鄭麗文) yesterday arrived in China for a “peace” mission and potential meeting with Chinese President Xi Jinping (習近平), while a Taiwanese minister detailed the number of Chinese warships currently deployed around the nation. Cheng is visiting at a time of increased Chinese military pressure on Taiwan, as the opposition-dominated Legislative Yuan stalls a government plan for US$40 billion in extra defense spending. Speaking to reporters before going to the airport, Cheng said she was going on a “historic journey for peace,” but added that some people felt uneasy about her trip. “If you truly love Taiwan,
NEW LOW: The council in 2024 based predictions on a pessimistic estimate for the nation’s total fertility rate of 0.84, but last year that rate was 0.69, 17 percent lower An expected National Development Council (NDC) report expects the nation’s population to drop below 12 million by 2065, with the old-age dependency ratio to top 100 percent sooner than 2070, sources said yesterday. The council is slated to release its latest population projections in August, using an ultra-low fertility model, the sources said. The previous report projected that Taiwan’s population would fall to 14.37 million by 2070, but based on a new estimate of the total fertility rate (TFR) — the average number of children born to a woman over her lifetime — the population is expected to reach 12 million by
RSS