Japan: Japan’s economy reportedly grew faster than expected in the three months to the end of June as the country’s car exports rebounded and tourists flooded back. But the economists warned that it wouldn’t last.
In the recent period, the third-largest global economy experienced a 6 percent annualised increase in its Gross Domestic Product (GDP). It is roughly double the growth rate predicted by economists and represents the largest increase in nearly three years.
The value of the yen’s fall caused Japanese-made goods to become cheaper for consumers around the world. It helped marketers increase the growth of exports. Japan’s currency has experienced a significant decline against major currencies in recent months, dropping by over 10 percent compared to the US dollar in the current year.
The country’s car manufacturers, which include Toyota, Honda, and Nissan, have seen their profits rise in recent months due to a surge in demand for exports. Japan’s economy has additionally benefited from an increase in tourist arrivals following the government’s decision to lift border restrictions at the end of April 2023.
The number of international tourists visiting Japan had rebounded to over 70 percent of the levels seen before the pandemic by June 2023, as reported by the country’s national tourism authority. In August 2023, the economy is anticipated to receive a further lift from tourist expenditures, especially since China has lifted a ban on group travel.
Before the pandemic, Chinese tourists contributed to over a third of spending by visitors in Japan. This is helping counterbalance the effect of the slower recovery of domestic consumption in the country following the pandemic.
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