Japan may soon say sayonara to recession

If Barclays executives are to be believed, then Japan may soon be out of the global financial embroglio.

The economy, analysts from Barclays Capital claim, is poised to  grow slightly in the second quarter, a prospect which could make the 2nd largest economy in the world the first major developed country to resume its economic momentum. Economic indicators accordingly show relative  signs of rebound, although it is also admitted that given weak consumer spending, the growth may not be as fast as during the heydey of the now almost mythical Bubble Economy.

With Japan’s skilled labor supply shortage,  strict immigration policies and aging population, it is unlikely for Japan to be as productive as it had been decades ago. Unlike the US, for instance, Japan’s economic downturn was caused almost entirely by the decline in its exports. Apparently many markets stopped buying Japanese cars, televisions, and electronic products  to address trade deficits in their home fronts. Japanese companies who dominate the market for most of these consumer items, naturally suffered the brunt.

This not withstanding, however, popping champaignes may be premature. According to analysts, any indication of recovery would likely come too late to prevent the surge of unemployment which they expect to reach as high as 5.5 percent in the coming months. If this trend continues, all these rumored economic rebound would be meaningless. Government purportedly plans to inject a stimulus fund of about $15 o billion as a measure to mitigate the country’s downward spiral. 

Japanese consumers, on the other hand, remain pessimistic and people generally prefer to keep their money amidst sever conditions in wages and employment.

Japan may soon bid its financial woes adieu in the next few months, but clearly it does not mean the worst is over.