In 1968, it surpassed West Germany and ranked second after the United States.
Expected to rank 5th in 2026, falling behind even the seal
“Weak yen – big impact on inflation”
It is certain that Japan’s economy will catch up with Germany’s last year and fall from 3rd to 4th place in the world. It falls behind Germany for the first time in 55 years since 1968.
According to the Asahi Shimbun on the 16th, Japan’s Mitsubishi UFJ Research Consulting predicted Japan’s gross domestic product (GDP) last year to be 591 trillion yen (about 4.2 trillion dollars). Previously, in October last year, the International Monetary Fund (IMF) also announced that Japan’s nominal GDP in 2023 is expected to be $4.2308 trillion, a 0.2% decrease from the previous year. Official Japanese government statistics will be announced in February.
On the other hand, the German National Statistical Office announced that last year’s GDP was 4.1211 trillion euros (about 4.5006 trillion dollars), a 6.3% increase from the previous year.
The size of Japan’s economy surpassed West Germany in 1968 and rose to second place after the United States. Afterwards, in 2010, it fell behind China to 3rd place, and now falls to 4th place, behind Germany, once called the ‘sick man of Europe’. It is predicted that by 2026, it will be overtaken by India and fall to 5th place.
The growth in the size of the German economy is largely due to the sharp rise in energy prices following Russia’s invasion of Ukraine, which has raised prices even higher than those of Japan. Since nominal GDP is calculated at market prices, it increases as prices rise. On the other hand, Japan’s GDP based on yen increased by 5.7% compared to the previous year, but was expected to decrease by 1.2% when converted to dollars due to the continued low yen phenomenon.
The Asahi Shimbun said, “Japan’s GDP fell behind Germany’s last year due to the weak yen and Germany’s inflation, but in the long run, Germany’s economic growth rate exceeded Japan’s,” and “Germany’s real growth rate between 2000 and 2022 is 1.2%, but Germany’s growth rate is 1.2%. In Japan, it was 0.7%.”
Japan’s GDP per capita was already at $34,064 in 2022, falling behind even Italy and ranking last among the seven major countries (G7). The prolonged low yen means that export conditions have improved, but it is also evidence that Japan’s economic power has declined compared to other countries.
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Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.