Title: Why is Japan's economy shrinking? | World Economic Forum
Headings: Why is Japan's economy shrinking?
Why is Japan's economy shrinking?
What’s the problem?
What’s causing it?
What is Abenomics?
What does that look like in reality?
So what happens next?
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Content: The news that Japan’s economy shrank at an annualised rate of 1.4% in the last quarter of 2015 has come as a severe blow, even for a country used to difficult economic news. The contraction was worse than had been anticipated and casts doubt on Prime Minister Shinzo Abe’s Abenomics – his drive to lift the country out of stagnation. What’s the problem? The world’s third largest economy has been battling deflation for 20 years. Prime Minister Shinzo Abe pledged to lift Japan out of its malaise with ally Haruhiko Kuroda, governor of the central bank, committing to doing “whatever it takes”. But after a promising start, Abenomics appears to be faltering. The new figures show that the economy shrank between October-December last year with slower exports and weak domestic demand being blamed for the contraction. What’s causing it? Japan's economy stagnated in the 1990s after its stock market and property bubbles burst. Companies focused on cutting debt and shifting manufacturing overseas.