Japan'S First Quarter GDP Declines 3.4% In 2020

Japan's Cabinet Office announced in May 18th (2020) in 2020 of 1-3 January, the total domestic production (GDP) quick report value shows that the adjustment factor of the actual season excluding price changes is 3.4% worse than the same period last year, showing negative growth for the two consecutive quarter. The main reason is the spread of new crown pneumonia infection, the suspension of business and the avoidance of going out by people, resulting in a sharp decrease in personal consumption, exports and tourists visiting Japan, resulting in the stagnation of trade activities.

From the point of view of projects, personal consumption, which accounts for more than half of the total GDP, dropped by 0.7%, private equipment investment decreased by 0.5%, residential investment decreased by 4.5%, and public investment decreased by 0.4%. In addition, 1~3 exports also declined 6%, the largest reduction since the second quarter of 2011.

Japan's first quarter GDP decline is not as bad as expected. It is mainly because of the slight decrease in personal consumption and equipment investment. However, the Japanese government officials believe that 4-6 months of 2020 GDP is also hard to avoid a serious fall, and the impact of the new crown pneumonia epidemic is spreading. Civil institutions predict that Japan's 4-6 month GDP will suffer a sharp decline of about 20%, which is the worst performance since the two World War.