Economic overview Japan, in 36 editions.

Although Japan has few natural resources, since 1971 it has become the world's third-largest industrial economy, ranking behind only the US and the USSR. Government-industry cooperation, a strong work ethic, and a comparatively small defense allocation have helped Japan advance rapidly, notably in high-technology fields. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. Self-sufficent in rice, Japan must import 50% of its requirements for other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the total global catch. Overall economic growth has been spectacular: a 10% average in the 1960s, a 5% average in the 1970s and 1980s. In 1989 1990 strong investment and consumption spending helped maintain growth at nearly 5%. 5.6%. Inflation remains low at 2.1% 3.1% despite high higher oil prices and rising wages because of a somewhat weaker yen. tight labor market. Japan continues to run a huge trade surplus, $60 $52 billion in 1989, 1990, which supports extensive investment in foreign properties.

Although Japan has few natural resources, since 1971 it has become the world's third-largest economy, ranking behind only the US and the USSR. Government-industry cooperation, a strong work ethic, and a comparatively
small defense allocation have helped Japan advance rapidly, with extraordinary
rapidity, notably in high-technology fields. Industry, the most important
sector of the economy, is heavily dependent on imported raw materials and
fuels. Self-sufficent in rice, Japan must import 50% of its requirements for
other grain and fodder crops. Japan maintains one of the world's largest
fishing fleets and accounts for nearly 15% of the global catch. Overall
economic growth has been spectacular: a 10% average in the 1960s, a 5%
average in the 1970s and 1980s. In 1990 strong investment and consumption spending helped maintain A major contributor to overall growth at 5.6%. of
4.5% in 1991 was net exports, which cushioned the effect of slower growth in
domestic demand. Inflation remains low at 3.1% despite higher 3.3% and is easing due to lower
oil prices and rising wages because of a tight labor market. stronger yen. Japan continues to run a huge trade surplus, $52
$80 billion in 1990, 1991, which supports extensive investment in foreign properties. assets.
The increased crowding of its habitable land area and the aging of its
population are two major long-run problems.

Government-industry cooperation, a strong work ethic, and a comparatively
small defense allocation have helped Japan advance with extraordinary
rapidity, notably in high-technology fields. Industry, the most important
sector of the economy, is heavily dependent on imported raw materials and
fuels. Self-sufficent Self-sufficient in rice, Japan must import about 50% of its requirements for
requirements of other grain and fodder crops. Japan maintains one of the
world's largest
fishing fleets and accounts for nearly 15% of the global
catch. Overall
economic growth has been spectacular: a 10% average in the
1960s, a 5%
average in the 1970s and 1980s. A major contributor to overall Economic growth of slowed markedly
4.5% in 1991 was net exports, which cushioned the effect 1992 largely because of slower growth in
contractionary domestic demand. Inflation remains low at 3.3% and is easing due policies intended to lower
oil prices wring speculative excesses from the stock and a real estate markets. At the
same time, the stronger yen. yen and slower global growth are containing export
growth. Unemployment and inflation remain low at 2%. Japan continues to run
a huge trade surplus,
$80 surplus - $107 billion in 1991, 1992, up nearly 40% from the year
earlier - which supports extensive investment in foreign assets.
The increased
crowding of its habitable land area and the aging of its
population are two
major long-run problems.

Government-industry cooperation, a strong work ethic, mastery of high
technology, and a comparatively
small defense allocation have helped
Japan advance with extraordinary rapidity to the rank of second most
rapidity, notably powerful economy in high-technology fields. the world. Industry, the most important
sector of
the economy, is heavily dependent on imported raw materials and
fuels.
Self-sufficient in rice, Japan must import about 50% of its
requirements of other grain and fodder crops. Japan maintains one of the
the world's largest fishing fleets and accounts for nearly 15% of the global
global catch. Overall economic growth has been spectacular: a 10%
average in the
1960s, a 5% average in the 1970s and 1980s. Economic growth slowed markedly
growth came to a halt in 1992 1992-93 largely because of contractionary
domestic policies intended to
wring speculative excesses from the
stock and real estate markets. At the
same time, the stronger yen and
slower global growth are containing export
growth. Unemployment and
inflation remain remarkably low at 2%. in comparison with the other
industrialized nations. Japan continues to run
a huge trade surplus - $107
$120 billion in 1992, 1993, up nearly 40% more than 10% from the year
earlier - which
supports extensive investment in foreign assets. The new prime
minister HATA in early 1994 reiterated previous governments' vows of
administrative and economic reform, including reduction in the trade
surplus, but his weak coalition government faces strong resistance
from traditional interest groups. The crowding of its the habitable land
area and the aging of its the population are two
major long-run problems.

Government-industry cooperation, a strong work ethic,
mastery of high
technology, and a comparatively small defense
allocation (roughly 1% of GDP) have helped
Japan advance with
extraordinary rapidity to the rank of second most
powerful economy in
the world. Industry, the most important sector of
the economy, is
heavily dependent on imported raw materials and fuels. Usually
Self-sufficient self-sufficient in rice, Japan must import about 50% of its
requirements of other grain and fodder crops. Japan maintains one of
the world's largest fishing fleets and accounts for nearly 15% of the
global catch. Overall economic growth has been spectacular: a 10%
average in the 1960s, a 5% average in the 1970s and 1980s. Economic
growth came to a halt in 1992-93 largely because of contractionary
domestic policies intended to wring speculative excesses from the
stock and real estate markets. At the same time, Growth resumed at a 0.6% pace in 1994
largely because of consumer demand. As for foreign trade, the stronger
yen and
slower global growth are containing export growth.
Unemployment and
inflation remain remarkably low in comparison with
the other
industrialized nations. Japan continues to run a huge trade
surplus -
$120 $121 billion in 1993, up more than 10% from 1994, roughly the year earlier same size as in 1993 - which
which supports extensive investment in foreign assets. The new prime Prime Minister
minister HATA in early 1994 reiterated previous governments' vows of MURAYAMA has yet to formalize his government's plans for
administrative and economic reform, including reduction in the trade
surplus, but his weak surplus. As leader of a coalition government faces strong resistance government, he has softened his own
from traditional interest groups. socialist positions. The crowding of the habitable land
area and the
aging of the population are two major long-run problems.

Government-industry cooperation, a strong work ethic,
ethic, mastery of high technology, and a comparatively small defense
allocation (roughly 1% of GDP) have helped Japan advance with
extraordinary rapidity to the rank of second most powerful economy in
in the world. One notable characteristic of the economy is the
working together of manufacturers, suppliers, and distributors in
closely knit groups called keiretsu. A second basic feature has been
the guarantee of lifetime employment for a substantial portion of
the urban labor force; this guarantee is slowly eroding. Industry,
the most important sector of the economy, is
heavily dependent on
imported raw materials and fuels. Usually The much smaller agricultural
sector is highly subsidized and protected, with crop yields among
the highest in the world. Usually self-sufficient in rice, Japan
must import about 50% of its
requirements of other grain and fodder
crops. Japan maintains one of
the world's largest fishing fleets and
accounts for nearly 15% of the
global catch. Overall For three decades
overall economic growth has had been spectacular: a 10%
average in the
1960s, a 5% average in the 1970s and 1980s. Economic
growth Growth came to a halt in 1992-93
1992-95 largely because of contractionary the aftereffects of overinvestment during
the late 1980s and contractionary domestic policies intended to
wring speculative excesses from the
stock and real estate markets. Growth resumed at a 0.6% pace in 1994
largely because of consumer demand. As for foreign trade, At yearend 1995, the stronger
yen and slower global growth are containing export growth.
Unemployment and inflation remain remarkably low in comparison financial structure is shaky with banks holding
hundreds of billions of dollars of suspect assets. At the other industrialized nations. Japan continues to run a huge trade same time,
surplus - $121 billion in 1994, roughly the same size as continued basic strength of the economy has been reflected in 1993 -
which supports extensive investment in substantial trade surpluses, sizable foreign assets. Prime Minister
MURAYAMA has yet to formalize his government's plans for
administrative investments, and economic reform, including reduction in the trade
surplus. As leader remarkably low rates of a coalition government, he has softened his own unemployment, inflation, and social
socialist positions. disorder. The crowding of the habitable land area and the
aging of
the population are two major long-run problems.

Government-industry cooperation, a strong work
ethic, mastery of high technology, and a comparatively small defense
allocation (roughly 1% of GDP) have helped Japan advance with
extraordinary rapidity to the rank of second most powerful economy
in
the world. One notable characteristic of the economy is the
working
together of manufacturers, suppliers, and distributors in
closely knit
groups called keiretsu. A second basic feature has been
the guarantee
of lifetime employment for a substantial portion of
the urban labor
force; this guarantee is slowly eroding. Industry,
the most important
sector of the economy, is heavily dependent on
imported raw materials
and fuels. The much smaller agricultural
sector is highly subsidized
and protected, with crop yields among
the highest in the world.
Usually self-sufficient in rice, Japan
must import about 50% of its
requirements of other grain and fodder
crops. Japan maintains one of
the world's largest fishing fleets and
accounts for nearly 15% of the
global catch. For three decades
overall real economic growth had been
spectacular: a 10% average in the
1960s, a 5% average in the 1970s 1970s,
and a 4% average in the 1980s. Growth came to a halt slowed considerably in
1992-95
largely because of the aftereffects of overinvestment during
the late
1980s and contractionary domestic policies intended to
wring
speculative excesses from the stock and real estate markets.
At yearend 1995, the financial structure is shaky with banks holding
hundreds of billions of dollars of suspect assets. At the same time, Growth
the continued basic strength of the economy has been reflected picked up in
substantial trade surpluses, sizable foreign investments, 1996, largely a reflection of stimulative fiscal and
remarkably monetary policies as well as low rates of unemployment, inflation, inflation and social
disorder. As a result of the expansionary fiscal policies and
declining tax revenues due to the recession, Japan currently has one
of the largest budget deficits as a percent of GDP among the
industrialized countries. The crowding of the habitable land area and the
aging of
the population are two other major long-run problems.

Government-industry cooperation, a strong work
ethic, mastery of high technology, and a comparatively small defense
allocation (roughly 1% of GDP) have helped Japan advance with
extraordinary rapidity to the rank of second most powerful economy in
the world. One notable characteristic of the economy is the working
together of manufacturers, suppliers, and distributors in closely knit
groups called keiretsu. A second basic feature has been the guarantee
of lifetime employment for a substantial portion of the urban labor
force; this guarantee is slowly eroding. Industry, the most important
sector
of the economy, is heavily dependent on imported raw materials
and
fuels. The much smaller agricultural sector is highly subsidized
and
protected, with crop yields among the highest in the world.
Usually
self-sufficient in rice, Japan must import about 50% of its
requirements of other grain and fodder crops. Japan maintains one of
the world's largest fishing fleets and accounts for nearly 15% of the
global catch. For three decades overall real economic growth had been
spectacular: a 10% average in the 1960s, a 5% average in the 1970s,
and a 4% average in the 1980s. Growth slowed considerably markedly in 1992-95
largely because of the aftereffects of overinvestment during the late
1980s and contractionary domestic policies intended to wring
speculative excesses from the stock and real estate markets. Growth
picked up to 3.9% in 1996, largely a reflection of stimulative fiscal and
and monetary policies as well as low rates of inflation and social inflation. But in 1997
disorder. growth fell back to 1%. As a result of the expansionary fiscal
policies and
declining tax revenues due to the recession, Japan currently has one
one of the largest budget deficits as a percent of GDP among the
industrialized countries. The crowding of habitable land area and the
aging of the population are two other major long-run problems.

Government-industry cooperation, a strong work
ethic, mastery of high technology, and a comparatively small defense
allocation (roughly 1% (1% of GDP) have helped Japan advance with
extraordinary
rapidity to the rank of second most powerful economy in
the world.
One notable characteristic of the economy is the working
together of
manufacturers, suppliers, and distributors in closely knit
groups
called keiretsu. A second basic feature has been the guarantee
of
lifetime employment for a substantial portion of the urban labor
force; this guarantee is eroding. Industry, the most important sector
sector of the economy, is heavily dependent on imported raw
materials and
fuels. The much smaller agricultural sector is highly
subsidized and
protected, with crop yields among the highest in the
world. Usually
self-sufficient in rice, Japan must import about 50%
of its
requirements of other grain and fodder crops. Japan maintains
one of
the world's largest fishing fleets and accounts for nearly
15% of the
global catch. For three decades overall real economic
growth had been
spectacular: a 10% average in the 1960s, a 5%
average in the 1970s,
and a 4% average in the 1980s. Growth slowed
markedly in 1992-95
largely because of the aftereffects of
overinvestment during the late
1980s and contractionary domestic
policies intended to wring
speculative excesses from the stock and
real estate markets. Growth
picked up to 3.9% in 1996, largely a
reflection of stimulative fiscal
and monetary policies as well as
low rates of inflation. But in 1997
growth fell back to 1%. As 1997-98 Japan experienced a result of wrenching
recession, centered about financial difficulties in the expansionary fiscal banking
policies system and declining tax revenues due to the recession, Japan real estate markets and exacerbated by rigidities in
corporate structures and labor markets. In early 1999 output has
one of the largest budget deficits started to stabilize as a percent of GDP among the emergency government spending begins to take
industrialized countries. hold. The crowding of habitable land area and the
aging of the
population are two other major long-run problems.

Government-industry cooperation, a strong work
ethic, mastery of high technology, and a comparatively small defense
allocation (1% of GDP) have helped Japan advance with extraordinary
rapidity to the rank of second most technologically powerful economy in the world.
world after the US and third largest economy in the world after the US and China. One notable characteristic of the economy is the working together of
manufacturers, suppliers, and distributors in closely knit groups
called keiretsu. A second basic feature has been the guarantee of
lifetime employment for a substantial portion of the urban labor
force; this guarantee is force. Both features are now eroding. Industry, the most important
sector of the economy, is heavily dependent on imported raw
materials and fuels. The much smaller agricultural sector is highly
subsidized and protected, with crop yields among the highest in the
world. Usually self-sufficient in rice, Japan must import about 50%
of its requirements of other grain and fodder crops. Japan maintains
one of the world's largest fishing fleets and accounts for nearly
15% of the global catch. For three decades overall real economic
growth had been spectacular: a 10% average in the 1960s, a 5%
average in the 1970s, and a 4% average in the 1980s. Growth slowed
markedly in 1992-95 largely because of the aftereffects of
overinvestment during the late 1980s and contractionary domestic
policies intended to wring speculative excesses from the stock and
real estate markets. Growth picked up to 3.9% in 1996, largely a
reflection of stimulative fiscal and monetary policies as well as
low rates of inflation. But in 1997-98 Japan experienced a wrenching
recession, centered about financial difficulties in the banking
system and real estate markets and exacerbated by rigidities in
corporate structures and labor markets. In early 1999 output has
started to stabilize as emergency government spending begins began to take
hold. hold and business confidence gradually improved. The crowding of habitable land area and the aging of the
population are two major long-run problems. Robotics constitutes a key long-term economic strength, with Japan possessing 410,000 of the world's 720,000 "working robots".

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) have helped Japan advance with extraordinary rapidity to the rank of second most technologically powerful economy in the world after the US and third largest economy in the world after the US and China. One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely knit closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. The much smaller agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan must import about 50% of its requirements of other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades overall real economic growth had been spectacular: a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in 1992-95 the 1990s largely because of the aftereffects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. Growth picked up Government efforts to 3.9% in 1996, largely a reflection of stimulative fiscal revive economic growth have met little success and monetary policies as well as low rates of inflation. But in 1997-98 Japan experienced a wrenching recession, centered about financial difficulties were further hampered in the banking system and real estate markets and exacerbated late 2000 by rigidities in corporate structures and labor markets. In 1999 output started to stabilize as emergency government spending began to take hold the slowing of the US and business confidence gradually improved. Asian economies. The crowding of habitable land area and the aging of the population are two major long-run problems. Robotics constitutes a key long-term economic strength, with Japan possessing 410,000 of the world's 720,000 "working robots".

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) have helped Japan advance with extraordinary rapidity to the rank of second most technologically powerful economy in the world after the US and third largest economy in the world after the US and China. One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. The much smaller agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan must import about 50% of its requirements of other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades overall real economic growth had been spectacular: a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s largely because of the aftereffects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. Government efforts to revive economic growth have met with little success and were further hampered in late 2000 2000-02 by the slowing of the US and Asian economies. The crowding of habitable land area and the aging of the population are two major long-run problems. Robotics constitutes a key long-term economic strength, with Japan possessing 410,000 of the world's 720,000 "working robots". Internal conflict over the proper means to reform the ailing banking system will continue in 2003.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) have helped Japan advance with extraordinary rapidity to the rank of second most technologically powerful second-most-technologically-powerful economy in the world after the US and third largest third-largest economy in the world after the US and China. One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. The much smaller agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan must import about 50% of its requirements of other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades overall real economic growth had been spectacular: a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s 1990s, averaging just 1.7%, largely because of the aftereffects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. Government efforts to revive economic growth have met with little success and were further hampered in 2000-02 2000-2003 by the slowing of the US US, European, and Asian economies. The crowding Japan's huge government debt, which is approaching 150% of habitable land area GDP, and the aging ageing of the population are two major long-run problems. Robotics constitutes a key long-term economic strength, strength with Japan possessing 410,000 of the world's 720,000 "working robots". robots." Internal conflict over the proper means way to reform the ailing banking system will continue in 2003. continues.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity to the rank of second-most-technologically-powerful second most technologically-powerful economy in the world after the US and third-largest economy after the US and China. One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. The much smaller agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan must import about 50% of its requirements of other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades overall real economic growth had been spectacular: a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects after effects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. Government efforts to revive economic growth have met with little success and were further hampered in 2000-2003 by the slowing of the US, European, and Asian economies. Japan's huge government debt, which is approaching totals more than 150% of GDP, and the ageing of the population are two major long-run problems. Robotics constitutes a key long-term economic strength with Japan possessing 410,000 of the world's 720,000 "working robots." Internal conflict over the proper way to reform the ailing banking system continues.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity to the rank of second most technologically-powerful economy in the world after the US and third-largest economy after the US and China. China, measured on a purchasing power parity (PPP) basis. (Using market exhange rates rather than PPP rates, Japan's economy is larger than China's.) One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important sector of the economy, is heavily dependent on imported raw materials and fuels. The much smaller tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient self sufficient in rice, Japan must import about 50% of its requirements of other grain and fodder crops. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades overall real economic growth had been spectacular: a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. Government From 2000 to 2003, government efforts to revive economic growth have met with little success and were further hampered in 2000-2003 by the slowing of the US, European, and Asian economies. In 2004, growth improved and the lingering fears of deflation in prices and economic activity lessened. Japan's huge government debt, which totals more than 150% 160% of GDP, and the ageing aging of the population are two major long-run problems. A rise in taxes could be viewed as endangering the revival of growth. Robotics constitutes a key long-term economic strength with Japan possessing 410,000 of the world's 720,000 "working robots." Internal conflict over the proper way to reform the ailing banking system continues.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity to the rank of second most technologically-powerful technologically powerful economy in the world after the US and the third-largest economy in the world after the US and China, measured on a purchasing power parity (PPP) basis. (Using market exhange rates rather than PPP rates, Japan's economy is larger than China's.) One notable characteristic of the economy is the working together of how manufacturers, suppliers, and distributors work together in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding. Industry, the most important Japan's industrial sector of the economy, is heavily dependent on imported raw materials and fuels. The tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan must import about 50% 60% of its requirements of other grain and fodder crops. food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades decades, overall real economic growth had been spectacular: spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets. markets and to force a restructuring of the economy. From 2000 to 2003, government efforts to revive economic growth met with little success and were further hampered by the slowing of the US, European, and Asian economies. In 2004, 2004 and 2005, growth improved and the lingering fears of deflation in prices and economic activity lessened. Japan's huge government debt, which totals more than 160% 170% of GDP, and the aging of the population are two major long-run problems. A Some fear that a rise in taxes could be viewed as endangering endanger the revival of growth. Robotics constitutes a key long-term current economic strength with Japan possessing 410,000 of the world's 720,000 "working robots." recovery. Internal conflict over the proper way to reform the ailing banking financial system continues. will continue as Japan Post's banking, insurance, and delivery services undergo privatization between 2007 and 2017.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity to the rank of second most technologically powerful economy in the world after the US and the third-largest economy in the world after the US and China, measured on a purchasing power parity (PPP) basis. One notable characteristic of the economy is has been how manufacturers, suppliers, and distributors work have worked together in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are have now eroding. eroded. Japan's industrial sector is heavily dependent on imported raw materials and fuels. The tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan must import about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of overinvestment and an asset price bubble during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets and to force that required a restructuring protracted period of the economy. time for firms to reduce excess debt, capital, and labor. From 2000 to 2003, 2001, government efforts to revive economic growth met with little success proved short-lived and were further hampered by the slowing of the US, European, and Asian economies. In 2004 and 2005, 2002-06, growth improved and the lingering fears of deflation in prices and economic activity lessened. Japan's huge government debt, which totals 170% 176% of GDP, and the aging of the population are two major long-run problems. Some fear that a rise in taxes could endanger the current economic recovery. Internal conflict over Debate also continues on the proper way to role of and effects of reform in restructuring the financial system will continue as economy, particularly with respect to the 2007-17 privatization of Japan Post's banking, insurance, and Post, which has functioned not only as the national postal delivery services undergo privatization between 2007 system but also, through its banking and 2017. insurance facilities, as Japan's largest financial institution.

Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity to the rank of second most technologically powerful economy in the world after the US and the third-largest economy in the world after the US and China, measured on a purchasing power parity (PPP) basis. One notable characteristic of the economy has been how manufacturers, suppliers, and distributors have worked together in closely-knit groups called keiretsu. A second basic feature has been the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features have now eroded. Japan's industrial sector is heavily dependent on imported raw materials and fuels. The tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan must import about 60% 55% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of overinvestment and an asset price bubble during the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. From 2000 to 2001, government efforts to revive economic growth proved short-lived short lived and were hampered by the slowing of the US, European, and Asian economies. In 2002-06, 2002-07, growth improved and the lingering fears of deflation in prices and economic activity lessened. lessened, leading the central bank to raise interest rates to 0.25% in July 2006, up from the near 0% rate of the six years prior, and to 0.50% in February 2007. In addition, the 10-year privatization of Japan Post, which has functioned not only as the national postal delivery system but also, through its banking and insurance facilities as Japan's largest financial institution, was completed in October 2007, marking a major milestone in the process of structural reform. Nevertheless, Japan's huge government debt, which totals 176% 182% of GDP, and the aging of the population are two major long-run problems. Some fear that a rise in taxes could endanger the current economic recovery. Debate also continues on the role of and effects of reform in restructuring the economy, particularly with respect to the 2007-17 privatization of Japan Post, which has functioned not only as the national postal delivery system but also, through its banking and insurance facilities, as Japan's largest financial institution. increasing income disparities.

Government-industry In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary rapidity speed to the rank of second most technologically powerful economy in the world after the US and US. Today, measured on a purchasing power parity (PPP) basis, Japan is the third-largest economy in the world after the US and China, measured on a purchasing power parity (PPP) basis. One China. Two notable characteristic of the post-war economy has been how were the close interlocking structures of manufacturers, suppliers, and distributors have worked together in closely-knit groups called keiretsu. A second basic feature has been distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features have are now eroded. eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. The A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan must import imports about 55% 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of overinvestment inefficient investment and an asset price bubble during in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. From 2000 to 2001, government efforts to revive economic growth proved short lived and were hampered by the slowing of the US, European, and Asian economies. In 2002-07, growth improved and the lingering fears October 2007 Japan's longest post-war period of deflation in prices and economic activity lessened, leading the central bank to raise interest rates to 0.25% expansion ended after 69 months and Japan entered into recession in July 2006, up from the 2008, with 2009 marking a return to near 0% rate of the six years prior, and to 0.50% in February 2007. In addition, the interest rates. The 10-year privatization of Japan Post, which has functioned not only as the national postal delivery system but also, through its banking and insurance facilities as Japan's largest financial institution, was completed in October 2007, marking a major milestone in the process of structural reform. Nevertheless, The Japanese financial sector was not heavily exposed to sub-prime mortgages or their derivative instruments and weathered the initial effect of the global credit crunch, but a sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into a recession. Japan's huge government debt, which totals 182% 170% of GDP, and the aging of the population are two major long-run problems. Some fear that a rise in taxes could endanger the current economic recovery. Debate also continues on the role of and effects of reform in restructuring the economy, particularly with respect to increasing income disparities. economy.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan advance with extraordinary speed to the rank of second most technologically powerful economy in the world after the US. Today, measured on develop a purchasing power parity (PPP) basis, Japan is the third-largest economy in the world after the US and China. technologically advanced economy. Two notable characteristic characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. In October 2007 Japan's longest post-war period of economic expansion ended after 69 months and Japan entered into recession in 2008, with 2009 marking a return to near 0% interest rates. The 10-year privatization of Japan Post, which has functioned not only as the national postal delivery system but also, through its banking and insurance facilities as Japan's largest financial institution, was completed in October 2007, marking a major milestone in the process of structural reform. The Japanese financial sector was not heavily exposed to sub-prime mortgages or their derivative instruments and weathered the initial effect of the recent global credit crunch, but a sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into a recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but Tokyo is warning that GDP growth will slow in 2011. Prime Minister Kan's government has proposed opening the agricultural and services sectors to greater foreign competition and boosting exports through free-trade agreements, but debate continues on restructuring the economy and funding new stimulus programs in the face of a tight fiscal situation. Japan's huge government debt, which totals 170% is approaching 200 percent of GDP, persistent deflation, and the an aging of the and shrinking population are two major long-run problems. Debate continues on the role of and effects of reform in restructuring complications for the economy.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient in rice, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2010 stood as the third-largest economy in the world after China, which surpassed Japan in 2001. The Japanese financial sector was not heavily exposed to sub-prime mortgages or their derivative instruments and weathered the initial effect of the recent global credit crunch, but a sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but Tokyo is warning that GDP growth will slow in 2011. 2010. Prime Minister Kan's KAN's government has proposed opening the agricultural and services sectors to greater foreign competition and boosting exports through free-trade agreements, but debate continues on restructuring the economy and funding new stimulus programs in the face of a tight fiscal situation. Japan's huge government debt, which is approaching 200 percent exceeds 200% of GDP, persistent deflation, reliance on exports to drive growth, and an aging and shrinking population are major complications long-term challenges for the economy. A 9.0-magnitude earthquake and an ensuing tsunami devastated the northeast coast of Honshu Island on 11 March 2011, washing away buildings and infrastructure as much as 6 miles inland, killing thousands, severely damaging several nuclear power plants, displacing and leaving homeless more than 320,000 people, and leaving a million households without running water. Radiation leaks at the Fukushima Daiichai nuclear power plant prompted mass evacuations and the declaration of a no-fly zone - initially for people and planes within 12.5 miles of the plant but later expanded to 19 miles. Radioactive iodine-131 has been found as far as 100 miles from the plant in samples of water, milk, fish, beef, and certain vegetables, at levels that make these foods unfit for consumption and create uncertainty regarding possible long-term contamination of the area. Energy-cutting efforts by electric companies and train lines slowed the pace of business throughout Honshu Island, and the stock market gyrated, dropping as much as 10% in a single day. In order to stabilize financial markets and retard appreciation of the yen, the Bank of Japan injected more than $325 billion in yen into the economy. Estimates of the direct costs of the damage - rebuilding homes and factories - range from $235 billion to $310 billion. Some economic forecasters, who previously had anticipated slower growth for Japan in 2011, now believe GDP may decline as much as 1% for the year.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self sufficient self-sufficient in rice, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2010 stood as the third-largest economy in the world Modest economic growth continued after China, which surpassed Japan in 2001. The Japanese financial sector was not heavily exposed to sub-prime mortgages or their derivative instruments and weathered the initial effect of the recent global credit crunch, 2000, but a the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into recession. Government stimulus spending helped the economy recover in late 2009 and 2010. 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake in March disrupted manufacturing. Recovery spending helped boost GDP in early 2012, but slower global economic growth began weakening Japan's export-oriented economy by mid-year. Electricity supplies remain tight because Japan tentatively shut down almost all of its nuclear power plants after the Fukushima Daiichi nuclear reactors were crippled by the earthquake and resulting tsunami. Newly-elected Prime Minister KAN's government Shinzo ABE has proposed opening declared the agricultural economy his government's top priority; he has pledged to reconsider his predecessor's plan to permanently close nuclear power plants and services sectors has said he will increase stimulus spending and press the Bank of Japan to greater foreign competition loosen monetary policy. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2012 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and boosting exports through free-trade agreements, but third-place India, which edged out Japan in 2012. The new government will continue a longstanding debate continues on restructuring the economy and funding new stimulus programs reining in the face of a tight fiscal situation. Japan's huge government debt, which exceeds 200% of GDP, persistent GDP. Persistent deflation, reliance on exports to drive growth, and an aging and shrinking population are other major long-term challenges for the economy. A 9.0-magnitude earthquake and an ensuing tsunami devastated the northeast coast of Honshu Island on 11 March 2011, washing away buildings and infrastructure as much as 6 miles inland, killing thousands, severely damaging several nuclear power plants, displacing and leaving homeless more than 320,000 people, and leaving a million households without running water. Radiation leaks at the Fukushima Daiichai nuclear power plant prompted mass evacuations and the declaration of a no-fly zone - initially for people and planes within 12.5 miles of the plant but later expanded to 19 miles. Radioactive iodine-131 has been found as far as 100 miles from the plant in samples of water, milk, fish, beef, and certain vegetables, at levels that make these foods unfit for consumption and create uncertainty regarding possible long-term contamination of the area. Energy-cutting efforts by electric companies and train lines slowed the pace of business throughout Honshu Island, and the stock market gyrated, dropping as much as 10% in a single day. In order to stabilize financial markets and retard appreciation of the yen, the Bank of Japan injected more than $325 billion in yen into the economy. Estimates of the direct costs of the damage - rebuilding homes and factories - range from $235 billion to $310 billion. Some economic forecasters, who previously had anticipated slower growth for Japan in 2011, now believe GDP may decline as much as 1% for the year.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually While self-sufficient in rice, rice production, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March disrupted manufacturing. Recovery spending helped boost GDP in early 2012, but slower global economic growth began weakening Japan's export-oriented The economy by mid-year. Electricity supplies remain tight because Japan tentatively shut down almost all of its nuclear power plants after has largely recovered in the Fukushima Daiichi nuclear reactors were crippled by two years since the earthquake and resulting tsunami. disaster, but reconstruction in the Tohoku region has been uneven. Newly-elected Prime Minister Shinzo ABE has declared the economy his government's top priority; he has pledged to reconsider his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus and regulatory reform and has said he will increase stimulus spending and press the Bank of Japan to loosen monetary policy. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2012 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. The new government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which exceeds 200% of GDP. Persistent deflation, reliance on exports to drive growth, and an aging and shrinking population are other major long-term challenges for the economy.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March disrupted manufacturing. The economy has largely recovered in the two years since the disaster, but reconstruction in the Tohoku region has been uneven. Newly-elected Prime Minister Shinzo ABE has declared the economy his government's top priority; he has pledged to reconsider overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus and regulatory reform stimulus, monetary easing, and has said he will press the Bank of structural reform. Japan joined the Trans Pacific Partnership negotiations in 2013, a pact that would open Japan's economy to loosen monetary policy. increased foreign competition and create new export opportunities for Japanese businesses. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2012 2013 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. The new government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which exceeds 200% is exceeding 230% of GDP. Persistent deflation, To help raise government revenue and reduce public debt, Japan decided in 2013 to gradually increase the consumption tax to a total of 10% by the year 2015. Japan is making progress on ending deflation due to a weaker yen and higher energy costs, but reliance on exports to drive growth, growth and an aging and aging, shrinking population are pose other major long-term challenges for the economy.

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically an advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Scarce in many natural resources, Japan has long been dependent on imported raw materials. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster in 2011, Japan's industrial sector is heavily has become even more dependent than it was previously on imported raw materials and fossil fuels. A small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis. For three decades, overall real economic growth had been spectacular impressive - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects aftereffects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession three four times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March of that year disrupted manufacturing. The economy has largely recovered in the two four years since the disaster, but although reconstruction in the affected Tohoku region has been uneven. lagged, in part due to a shortage of labor in the construction sector. Japan enjoyed a sharp uptick in growth in 2013 on the basis of Prime Minister Shinzo ABE has declared the economy his government's top priority; he has overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an Abe’s “Three Arrows” economic revitalization agenda - dubbed “Abenomics” - of fiscal stimulus, monetary easing, “flexible” fiscal policy, and structural reform. Abe’s government has replaced the preceding administration’s plan to phase out nuclear power with a new policy of seeking to restart nuclear power plants that meet strict new safety standards, and emphasizing nuclear energy’s importance as a base-load electricity source. Japan joined the Trans Pacific Trans-Pacific Partnership (TPP) negotiations in 2013, a pact that would open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2013 2014 stood as the fourth-largest economy in the world after second-place first-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. The new While seeking to stimulate and reform the economy, the government will continue must also devise a longstanding debate on restructuring the economy and strategy for reining in Japan's huge government debt, which is exceeding amounts to more than 230% of GDP. To help raise government revenue and reduce public debt, revenue, Japan decided adopted legislation in 2013 2012 to gradually increase raise the consumption tax rate to 10% by 2015, beginning with a total hike from 5% to 8% implemented in April 2014. That increase had a contractionary effect on GDP, however, so PM Abe in late 2014 decided to postpone the final phase of 10% the increase until April 2017 to give the economy more time to recover. Led by the year 2015. Bank of Japan’s aggressive monetary easing, Japan is making progress on in ending deflation due to a weaker yen and higher energy costs, deflation, but reliance on exports to drive growth demographics - low birthrate and an aging, shrinking population - pose other major long-term challenges for the economy.

In Over the years following World War II, past 70 years, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) have helped Japan develop an advanced economy. Two notable characteristics of the post-war post-World War II economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change.
Scarce in many natural resources, Japan has long been dependent on imported raw materials. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than it was previously before on imported fossil fuels. A small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis.
For three decades, overall real economic growth had been impressive - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects of inefficient investment and an asset price bubble in the late 1980s that required 1980s, after which it took a protracted period of considerable time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession four times since 2008. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March of that year disrupted manufacturing. economic activity. The economy has largely recovered in the four five years since the disaster, although reconstruction output in the affected Tohoku region has lagged, in part due areas continues to a shortage of labor in lag behind the construction sector. national average.
Japan enjoyed a sharp uptick in growth in 2013 on the basis of Prime Minister Shinzo Abe’s ABE’s “Three Arrows” economic revitalization agenda - dubbed “Abenomics” - of monetary easing, “flexible” fiscal policy, and structural reform. Abe’s In 2015, ABE revised his “Three Arrows” to raise nominal GDP by 20% to 600 trillion yen by 2020, stem population decline by raising the fertility rate, and provide more support for workers with children and aging relatives. ABE’s government has replaced the preceding administration’s plan to phase out nuclear power with a new policy of seeking to restart nuclear power plants that meet strict new safety standards, and emphasizing nuclear energy’s importance as a base-load electricity source. Japan joined successfully restarted two nuclear reactors at the Trans-Pacific Partnership (TPP) negotiations Sendai Nuclear Power Plant in 2013, Kagoshima prefecture. In October 2015, Japan and 11 trading partners reached agreement on the Trans-Pacific Partnership, a pact that would promises to open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses.
Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2014 2015 stood as the fourth-largest economy in the world after first-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. While seeking to stimulate and reform the economy, the government must also devise a strategy for reining in Japan's huge government debt, which amounts to more than 230% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate to 10% by 2015, beginning with a hike from 5% to 8% 8%, implemented in April 2014. That increase had a contractionary effect on GDP, however, so PM Abe ABE in late 2014 decided to postpone the final phase of the increase until April 2017 to give the economy more time to recover. Led by the Bank of Japan’s aggressive monetary easing, Japan is making progress in ending deflation, but demographics - demographic decline – a low birthrate and an aging, shrinking population - pose – poses a major long-term challenges challenge for the economy.

Over the past 70 years, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% (slightly less than 1% of GDP) have helped Japan develop an advanced economy. Two notable characteristics of the post-World War II economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding have significantly eroded under the dual pressures of global competition and domestic demographic change.
Scarce in many natural resources, Japan has long been dependent Measured on imported raw materials. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster a purchasing power parity basis that adjusts for price differences, Japan in 2011, Japan's industrial sector has become even more dependent than before on imported fossil fuels. A small agricultural sector is highly subsidized and protected, with crop yields among 2016 stood as the highest fourth-largest economy in the world. While self-sufficient world after first-place China, which surpassed Japan in rice production, 2001, and third-place India, which edged out Japan imports about 60% of its food on a caloric basis.
in 2012. For three postwar decades, overall real economic growth had been was impressive - a 10% average in the 1960s, 5% in the 1970s, and 4% in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects of inefficient investment and the collapse of an asset price bubble in the late 1980s, after which it took a entailed considerable time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession four times since 2008. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March of that year disrupted economic activity. The economy has largely recovered in the five years since the disaster, although output in the affected areas continues to lag behind the national average.
Japan enjoyed a sharp an uptick in growth in 2013 on the basis of Prime Minister Shinzo ABE’s “Three Arrows” economic revitalization agenda - dubbed “Abenomics” - of monetary easing, “flexible” fiscal policy, and structural reform. In 2015, ABE revised his “Three Arrows” to raise nominal GDP by 20% to 600 trillion yen by 2020, stem population decline Led by raising the fertility rate, Bank of Japan’s aggressive monetary easing, Japan is making modest progress in ending deflation, but demographic decline – a low birthrate and provide more support an aging, shrinking population – poses a major long-term challenge for workers with children the economy. The government currently faces the quandary of balancing its efforts to stimulate growth and aging relatives. ABE’s institute economic reforms with the necessity of addressing its sizable public debt, which stands at 235% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate. However, the first such increase, in April 2014, led to another recession, so Prime Minister ABE has replaced twice postponed the preceding administration’s plan next increase, now scheduled for October 2019. Structural reforms to phase out nuclear power with a new policy unlock productivity are seen as central to strengthening the economy in the long-run.
Scarce in critical natural resources, Japan has long been dependent on imported energy and raw materials. After the complete shutdown of Japan’s nuclear reactors following the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than before on imported fossil fuels. However, ABE’s government is seeking to restart nuclear power plants that meet strict new safety standards, standards and is emphasizing nuclear energy’s importance as a base-load electricity source. In August 2015, Japan successfully restarted two one nuclear reactors reactor at the Sendai Nuclear Power Plant in Kagoshima prefecture. prefecture, and several other reactors around the country have since resumed operations; however, opposition from local governments has delayed several more restarts that remain pending. Reforms of the electricity and gas sectors, including full liberalization of Japan’s energy market in April 2016 and gas market in April 2017, constitute an important part of Prime Minister Abe’s economic program.
In October 2015, Japan and 11 trading partners reached agreement on the Trans-Pacific Partnership, Partnership (TPP), a pact that promises had promised to open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses.
Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2015 stood as the fourth-largest economy in was the world after first-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. While seeking second country to stimulate and reform the economy, ratify the government must also devise a strategy for reining in Japan's huge government debt, which amounts to more than 230% of GDP. To help raise government revenue, Japan adopted legislation TPP in 2012 to gradually raise December 2016; the consumption tax rate to 10% by 2015, beginning with a hike United States signaled its withdrawal from 5% to 8%, implemented in April 2014. That increase had a contractionary effect on GDP, however, so PM ABE in late 2014 decided to postpone the final phase TPP on January 23, 2017, and as of the increase until April 2017 to give the economy more time to recover. Led by the Bank of Japan’s aggressive monetary easing, Japan is making progress in ending deflation, but demographic decline – a low birthrate and an aging, shrinking population – poses a major long-term challenge for the economy. agreement has not gone into effect.

Over the past 70 years, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (slightly less than 1% of GDP) have helped Japan develop an advanced economy. Two notable characteristics of the post-World War II economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features have significantly eroded under the dual pressures of global competition and domestic demographic change.
Measured on a purchasing power parity basis that adjusts for price differences, Japan in 2016 2017 stood as the fourth-largest economy in the world after first-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. For three postwar decades, overall real economic growth was impressive - a averaging 10% average in the 1960s, 5% in the 1970s, and 4% in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects of inefficient investment and the collapse of an asset price bubble in the late 1980s, which entailed considerable time for resulted in several years of economic stagnation as firms sought to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession four times since 2008.
Japan enjoyed an uptick in growth in 2013 on the basis of since 2013, supported by Prime Minister Shinzo ABE’s “Three Arrows” "Three Arrows" economic revitalization agenda - dubbed “Abenomics” "Abenomics" - of monetary easing, “flexible” "flexible" fiscal policy, and structural reform. Led by the Bank of Japan’s aggressive monetary easing, Japan is making modest progress in ending deflation, but demographic decline – a low birthrate and an aging, shrinking population – poses a major long-term challenge for the economy. The government currently faces the quandary of balancing its efforts to stimulate growth and institute economic reforms with the necessity of addressing need to address its sizable public debt, which stands at 235% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate. However, the first such increase, in April 2014, led to another recession, a sharp contraction, so Prime Minister ABE has twice postponed the next increase, which is now scheduled for October 2019. Structural reforms to unlock productivity are seen as central to strengthening the economy in the long-run.
Scarce in critical natural resources, Japan has long been dependent on imported energy and raw materials. After the complete shutdown of Japan’s nuclear reactors following the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than before on imported fossil fuels. However, ABE’s government is seeking to restart nuclear power plants that meet strict new safety standards and is emphasizing nuclear energy’s importance as a base-load electricity source. In August 2015, Japan successfully restarted one nuclear reactor at the Sendai Nuclear Power Plant in Kagoshima prefecture, and several other reactors around the country have since resumed operations; however, opposition from local governments has delayed several more restarts that remain pending. Reforms of the electricity and gas sectors, including full liberalization of Japan’s energy market in April 2016 and gas market in April 2017, constitute an important part of Prime Minister Abe’s economic program.
In October 2015, Japan and 11 trading partners reached agreement on Under the Trans-Pacific Partnership (TPP), a pact that had promised Abe Administration, Japan’s government sought to open Japan's the country’s economy to increased greater foreign competition and create new export opportunities for Japanese businesses. businesses, including by joining 11 trading partners in the Trans-Pacific Partnership (TPP). Japan was became the second first country to ratify the TPP in December 2016; 2016, but the United States signaled its withdrawal from the TPP on agreement in January 23, 2017, and as of April 2017. In November 2017 the remaining 11 countries agreed on the core elements of a modified agreement, which they renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Japan also reached agreement has not gone into effect. with the European Union on an Economic Partnership Agreement in July 2017, and is likely seek to ratify both agreements in the Diet this year.

Over the past 70 years, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (slightly less than 1% of GDP) have helped Japan develop an advanced economy. Two notable characteristics of the post-World War II economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features have significantly eroded under the dual pressures of global competition and domestic demographic change.
Measured on a purchasing power parity basis that adjusts for price differences, Japan in 2017 stood as the fourth-largest economy in the world after first-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. For three postwar decades, overall real economic growth was impressive - averaging 10% in the 1960s, 5% in the 1970s, and 4% in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects of inefficient investment and the collapse of an asset price bubble in the late 1980s, which resulted in several years of economic stagnation as firms sought to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession four times since 2008.
Japan enjoyed an uptick in growth since 2013, supported by Prime Minister Shinzo ABE’s "Three Arrows" economic revitalization agenda - dubbed "Abenomics" - of monetary easing, "flexible" fiscal policy, and structural reform. Led by the Bank of Japan’s aggressive monetary easing, Japan is making modest progress in ending deflation, but demographic decline – a low birthrate and an aging, shrinking population – poses a major long-term challenge for the economy. The government currently faces the quandary of balancing its efforts to stimulate growth and institute economic reforms with the need to address its sizable public debt, which stands at 235% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate. However, the first such increase, in April 2014, led to a sharp contraction, so Prime Minister ABE has twice postponed the next increase, which is now scheduled for October 2019. Structural reforms to unlock productivity are seen as central to strengthening the economy in the long-run.
Scarce in critical natural resources, Japan has long been dependent on imported energy and raw materials. After the complete shutdown of Japan’s nuclear reactors following the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than before on imported fossil fuels. However, ABE’s government is seeking to restart nuclear power plants that meet strict new safety standards and is emphasizing nuclear energy’s importance as a base-load electricity source. In August 2015, Japan successfully restarted one nuclear reactor at the Sendai Nuclear Power Plant in Kagoshima prefecture, and several other reactors around the country have since resumed operations; however, opposition from local governments has delayed several more restarts that remain pending. Reforms of the electricity and gas sectors, including full liberalization of Japan’s energy market in April 2016 and gas market in April 2017, constitute an important part of Prime Minister Abe’s economic program.
Under the Abe Administration, Japan’s government sought to open the country’s economy to greater foreign competition and create new export opportunities for Japanese businesses, including by joining 11 trading partners in the Trans-Pacific Partnership (TPP). Japan became the first country to ratify the TPP in December 2016, but the United States signaled its withdrawal from the agreement in January 2017. In November 2017 the remaining 11 countries agreed on the core elements of a modified agreement, which they renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Japan also reached agreement with the European Union on an Economic Partnership Agreement in July 2017, and is likely seek to ratify both agreements in the Diet this year.

fourth-largest second-largest East Asian economy; trade-oriented and highly diversified; high public debt levels; real wage declines in inflationary environment; sustained following years of near-zero central bank rates coupled with interest rates, gradual increases to address inflation and depreciation of yen; strong rebound in tourism tourism; aging population poses challenges to labor force participation