Japan revises down its record Q2 GDP drop
Tokyo, Sep 8 (efe-epa).- Japan’s gross domestic product (GDP) contracted 7.9 percent between April and June compared to the previous quarter, according to Tuesday’s revised data, which adds one tenth to the record drop announced in the first estimate.
This change, reported by the Cabinet Office, is mainly attributed to the impact of the COVID-19 pandemic, and in addition to being the third consecutive quarterly decline, it constitutes the most pronounced contraction recorded by the Japanese economy since comparable data records began.
The slight revision of the data is mainly due to corporate capital investment, a component of GDP that fell 4.7 percent quarter-on-quarter in the revised data, compared to the 1.5 percent decline initially estimated.
On the other hand, household spending, which accounts for more than half of Japan’s GDP, weakened by 7.9 percent, according to the revised data, which improves by three tenths the estimate published in the middle of the last month.
Exports of goods and services, another of the pillars of the world’s third largest economy, fell by 18.5 percent, unchanged compared to preliminary data.
The review also does not affect the quarterly evolution of the Japanese economy compared to the second quarter of 2019, which was down 9.9 percent.
The contraction in GDP is the result of the economic restrictions applied due to the pandemic, and in particular due to the state of emergency declared throughout the country between mid-April and the end of May, which in practice meant the closure or reduction of activities of numerous businesses.
In addition, during this period the authorities recommended that citizens stay at home except for essential trips, which dealt a severe blow to the already weak domestic consumption.
The Japanese economy also suffered from a situation marked by the drop in global demand and the collapse of foreign visitor spending due to border restrictions applied to face the global COVID-19 crisis. EFE-EPA