Japan, world’s 3rd biggest economy slips into recession amid Covid-19

Japan, the world’s third biggest economy has fallen into recession for the first time since 2015

Japan shrank an annualized 3.4% in the three months through March from the previous quarter as exports slid and social distancing reduced consumer spending.

It is said that Japan’s economy was already struggling before the outbreak due to the Typhoon Hagibis, a powerful storm that hit the country last year.

Tourism has dropped by as much as 90 per cent, industry and trade have ground to a halt and the virus also forced the postponement of the Tokyo 2020 Olympics that was seen as providing a boost to the economy.

Sources claim, Private consumption which contributes to more than half of Japan’s economy fell 0.7% before the government declared a state of emergency.

Exports which makes up 16% of Japan’s economy shrank 6% in the quarter, as goods bound for the country’s major trading partners stagnated

However, the Japanese government has already announced a record $1 trillion stimulus package, and Prime Minister Shinzo Abe has pledged a second budget later this month to fund fresh spending measures.