Japan’s economy shrinks at fastest rate in 35 years

The second largest economy in the world has bucked its own trend of steadfast reliable progression having experienced the fastest contraction in the economy for 35 years, according to the latest figures which revealed that the economy shrank 3.3 percent in the final quarter of 2008.

Japan is heavily reliant upon exports and the domestic consumption has weakened very quickly leaving the economy very exposed.

The latest talks form the G7 policymakers over the weekend revealed that all that is possible will be done to avert the severity of the recession. However, in Japan the viewpoint is different as the focus is on how much a government as heavily indebted as Japan can do to stimulate and recover a crippling economy.

In the meantime, Japanese firms such as Toyota and Sony have been announcing huge job cuts and have estimated net losses.

This has further increased the unpopularity of the government and its finance minister is under pressure following an embarrassing time in front of the G7.

Thus far, gross domestic product fell for a third straight quarter and with export demand falling by a record 13.9 percent in the same period, it seems as though this can only go from bad to worse in this period.

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