Coronavirus: Japan enters recession

Text by: RFI Follow

As the coronavirus crisis began to strike, the Japanese economy experienced a second straight quarter of contraction in gross domestic product between January and March, according to data released on Monday May 18 by the Japanese government.

Publicity

With our correspondent in Tokyo,  Frédéric Charles

According to analysts in Tokyo, the Japanese economy is expected to plunge 22% annualized between April and June. Which would constitute a historic low.

Consumption, which represents half of the economy, has been weighed down since the increase in VAT from 8 to 10% last October and, above all, the health crisis. Exports, they fall by 6% between January and March. Toyota anticipates an 80% drop in operating profit during the current fiscal year ending at the end of March 2021.

Two years to recover

Japan has ended the state of emergency over a large part of its territory , but still maintains it in Tokyo and other major cities until the end of this month. Shinzo Abe's government has already injected nearly € 1 trillion into its economy in the form of loans and grants. And it is about to invest capital in its medium and large companies weakened by the epidemic. Objecit: to allow them to borrow more easily from banks and prevent their bankruptcy.

But these state measures are considered insufficient, and their implementation too late . "  It will take at least two years for Japan to recover, due to the slowness of its bureaucracy,  " said Martin Schulz, the economist for the Fujitsu group in Tokyo.

► Read also: Coronavirus: Japanese automobile giant Toyota plans to collapse its activity

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• Japan
• Economic crisis

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