The biggest decline in Japan's economy record so far, GDP fell at 27.8% per annum in April-June quarter

 

The COVID-19 epidemic in Japan, the world's third-largest economy, has severely affected consumption and trade. Due to this, Japan's economy declined by 27.8 per cent year-on-year in the April-June quarter compared to the same period last year. This is the biggest drop in Japan's economy so far.

 

In a report released on Monday, Japan's Cabinet Office said that the country's pre-seasonal seasonally adjusted real gross domestic product (GDP) declined by 7.8 per cent over the January-March quarter. The annual rate means that if the economy will decline at the same rate throughout the year, then what will be the rate of annual decline. Significantly, Japan's economy is stuck in recession in the January-March quarter itself.

 

According to Japan's media reports, the decline in Japan's economy is the biggest economic decline since World War II. But the Cabinet Office said that Japan started keeping such economic figures since 1980. The last biggest economic decline was recorded in 2009 when the whole world was going through the global financial crisis of 2008-09. Japan's economy recorded a 1.8 per cent decline in the October-December 2019 quarter. Thereafter, the economy declined by 0.6 per cent in the January-March 2020 quarter. This means that Japan's economy is stuck in recession in the January-March quarter this year. The economic decline of two consecutive quarters is called economic slowdown. Japan's exports declined at an annual rate of 56 per cent in the June quarter. Private consumption declined during this period at an annual rate of around 29 per cent. Significantly, the business was never completely closed in Japan for the prevention of coronavirus. The number of confirmed coronavirus cases in the country has exceeded 56,000.

 

At the end of last year, when Coronavirus cases were reported in China, it had started showing its bad effects on Japan's economy. Since then, there has been a steady increase in the case of coronaviruses. Due to this, restrictions related to social distance have also increased. Japan is an export-oriented economy. It is very much dependent on the development of China. Coronavirus started from China and its infection is almost there now. But the demand is still not fully open.