Japan’s official economic data shows the country has slipped into a technical recession and slipped behind Germany as the fourth largest economy in the world.
Germany overtook Japan as the world's third-biggest economy, official data showed on Thursday, as fresh figures from Tokyo showed Japan's economy slipping into a recession.
Japan's nominal gross domestic product (GDP) for 2023 stood at $4.2 trillion in dollar terms, government data showed, compared to Germany's $4.5 trillion, according to the latest figures.
The yen slumped more than 18% against the dollar in 2022 and 2023. This includes a 7% depreciation last year, partly because the Bank of Japan (BOJ) has maintained negative interest rates.
Meanwhile the euro used in Germany has been more or less stable against the dollar overall in the same period.
India set to surpass both countries sooner than later
Both German and Japanese economies are facing comparable major issues of labor shortage, falling birthrates and aging populations, but Japan is the more acute case of the two.While the economy grew 1.9% overall, last year, it contracted for the last two consecutive quarters, data showed.Two consecutive quarters of contraction is typically considered as the definition of a technical recession.
Both Japan, with a population of roughly 125 million people, and the considerably smaller Germany with roughly 83 million people, are known worldwide as exporters of high-end manufactured goods, with the most obvious shared example being the automotive sector.
For years Japan was the world's second largest economy behind the US, until it was overtaken by China in 2010.
Developing giant India, with a majority of its 1.4 billion population under the age of 35, and higher growth rates, is projected to leapfrog both economies to become the third largest in the world behind the Unites States and China, probably quite soon. 🇮🇳📈
