{"id":107074,"date":"2021-02-15T02:16:35","date_gmt":"2021-02-15T02:16:35","guid":{"rendered":"https:\/\/fin2me.com\/?p=107074"},"modified":"2021-02-15T02:16:35","modified_gmt":"2021-02-15T02:16:35","slug":"japans-growth-rebounds-but-virus-related-weakness-looms","status":"publish","type":"post","link":"https:\/\/fin2me.com\/business\/japans-growth-rebounds-but-virus-related-weakness-looms\/","title":{"rendered":"Japan\u2019s Growth Rebounds, but Virus-Related Weakness Looms"},"content":{"rendered":"

TOKYO \u2014 Japan\u2019s economy rebounded sharply in the last three months of 2020, government data showed Monday, extending its recovery from the coronavirus\u2019s devastating impact in the first half of the year.<\/p>\n

But the growth was fragile and could be easily disrupted, analysts warned, at least in the short term. A second state of emergency declared at the end of last year is likely to drag the economy down again, and \u2014 as with many countries \u2014 it will most likely take years for certain business sectors, such as tourism, and consumer confidence to recover.<\/p>\n

Japan\u2019s economy, the world\u2019s third largest after the United States and China, grew 3 percent during the October to December period, for an annualized growth rate of 12.7 percent. It was the country\u2019s second consecutive quarter of growth.<\/p>\n

The economy had jumped 5.3 percent in the fiscal third quarter as the country emerged from a national emergency and regained a semblance of normalcy.<\/p>\n

\u201cThe biggest drivers of this quarter\u2019s growth were exports and consumer spending,\u201d said Toshihiro Nagahama, senior economist at the Dai-Ichi Life Research Institute, as economies released pent-up demand for Japanese goods that had built up during the early months of the pandemic.<\/p>\n

The Japanese economy had entered 2020 in a weakened state brought about by a rise in the national consumption tax, a stark drop in trade with China and a devastating typhoon. The pandemic then struck a major blow. As other economies crashed, Japan\u2019s shrank in its worst performance since 1955, when the country began using gross domestic product to measure its economy.<\/p>\n

But thanks in large part to the country\u2019s efforts to keep the pandemic under control, Japan avoided the worst of the economic damage that savaged the United States and much of Europe.<\/p>\n

This fall, while many consumers in the West sheltered in place, people in Japan were traveling, eating out and going to movies. One film, \u201cDemon Slayer: Mugen Train,\u201d set a domestic box-office record, outpacing the former champion in a few short months. Government subsidies for travel lifted domestic tourism, although such travel may have also spread the virus.<\/p>\n

At the same time, huge government stimulus efforts helped keep people in jobs and companies in business. Japan\u2019s unemployment rate stood at just 2.9 percent by the end of December versus 2.1 percent at the same time the year before. Bankruptcies actually dropped 6.5 percent in 2020, according to Teikoku Databank, a credit research company.<\/p>\n

Still, the past two quarters of growth did not make up for the damage wreaked by the pandemic. The economy ended down 4.8 percent for the year, the first annual contraction since 2009, when the country was suffering from the fallout of the global financial crisis.<\/p>\n

Latest Updates<\/h2>\n

While people in Japan are not facing the same level of short-term economic peril as those in the United States, growth is expected to contract again in the first three months of this year.<\/p>\n

The Coronavirus Outbreak \u203a<\/h3>\n

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