JAPAN

摘要

After a sharp -1.8% (q-o-q) contraction in GDP in the final quarter of last year, Japan is likely to slip into a technical recession in Q1 2020 as a result of the recent Covid-19 pandemic. The virus has led to severe supply-chain disruptions and strict travel restrictions as well as serious economic uncertainty. Tankan figures for Q1 show that business sentiment amongst large manufacturers has declined to its lowest level since 2013, and given the growing spread of the pandemic, confidence could yet drop further. Having said that, statistics for February showed that the economy held up quite well with retail sales advancing by 0.6% (m-o-m), perhaps due to panic buying, and industrial production rising by 0.4% (m-o-m) in the preliminary report, the third consecutive monthly expansion. Imports dropped by -14.0% (y-o-y) as those from China tanked by -47.1 %, but exports fared less poorly, declining by only -1.0% (y-o-y) on the back of a -2.6% fall in January. Prime Minister Abe declared a state of emergency on April 7 as the government attempts to contain an upsurge in infections in the Tokyo metropolitan area, not to mention protect Japan's rapidly aging population. Moreover, the authorities also want to prevent a return to deflation and are preparing another huge stimulus package to provide help for small businesses and households experiencing losses in income. This additional injection of public spending comes just four months after the launch of ¥13.2tn worth of measures designed to repair typhoon damage and invest in infrastructure and new technology.