Japan's economy rebounds in 2021

Source : https://www.argusmedia.com/en/news/2301969-japans-economy-rebounds-in-2021

 

Japan's economy rebounded by 1.7pc last year, supported by a solid recovery late in the year from a Covid-19 pandemic-induced slump.

Gross domestic product (GDP) increased at an annualised rate of 5.4pc in October-December compared with the previous quarter, according to preliminary government data released today. The economy recovered from a revised 2.7pc contraction in July-September.

Recovery in the private-sector's final consumption expenditure and exports contributed to the economic growth in Japan over October-December. This came after Japan fully lifted a Covid-19 state of emergency on 30 September, which boosted economic activity, especially in the commercial and transportation sectors.

Japan's economy grew 1.7pc last year, following a 4.5pc decline in 2020, and a 0.2pc drop in 2019. Japan's economy grew 0.6pc in 2018.

Japanese crude oil imports increased slightly to 2.49mn b/d in 2021 after hitting 2.47mn b/d — the lowest level in 52 years — in 2020, according to preliminary data from Japan's trade and industry ministry Meti. Run rates at domestic refineries edged up by 0.8 percentage points on the year to an average of 72pc in 2021. But LNG imports dropped slightly last year by 0.2pc to 74mn t, partly because several gas-fired power units were mothballed .

Japan's power demand increased by 1.3pc from 2020 to 875TWh in 2021, according to data from national power agency the Organisation for Cross-Regional Co-Ordination of Transmission Operators.

But Japan's economy is now under renewed pressure after the government enforced its Covid-19 semi-emergency measures in major business and industrial areas, including Tokyo, Nagoya and Osaka, last month. The number of infections in the country remains high amid the spread of the Omicron variant, with daily cases topping 105,570 on 5 February, according to the health ministry. Tokyo is now pushing a third vaccine rollout.

Japan's car production and possibly exports are also expected to remain under pressure as the country's biggest auto producer Toyota has revised down its global output target for the April 2021-March 2022 fiscal year on persistent motor parts shortage triggered by the Covid-19 outbreak. Japan's domestic car production declined for a second consecutive year in 2021.

 

By Motoko Hasegawa

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