With our review of the Japanese economic system this past week, this article seemed relevant. Japan is experiencing a contraction in it's economy. There are multiple factors influencing the shrink, but part of it is obviously due to the current economic situation. High unemployment in countries such as the US can result in problems for Japan which is a largely export-driven economy. Japan has also been affected similarly by the debt crisis in the eurozone as well as floods in Thailand hurting the regional economy. Despite the government intervention that exists in the country, Japan is still very much feeling the effects of a global recession.
http://www.bbc.co.uk/news/business-17008164
2 comments:
This situation is not out of people's anticipation. With the original systematical flaws, the Euro Zone crisis from outside, also plus the detrimental influence of the tsunami, Japanese economy still got a long way to go. I am more concerned about that, in this condition, whether or not some kinds of economic reform will be attained in this country who has a solid long history of its own Japan Model.
Fareed Zakaria made a huge deal that the Japanese had a trade deficit for the first time in years.I agree with Sijia that the Japanese have bad luck with the natural disaster and the bad global economy. With such a strong yen, I'm not surprised that Japan had a trade deficit this year, rather I'm surprised that they can continue to export despite their strong currency. The good thing is that they can easily import to replace the lost capital from their natural disaster, which happened almost a year ago.
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