Tokyo (AsiaNews / Agencies) - Japan's economy has lippe into what experts term a "technical" recession. According to preliminary data released today by the Government, the Gross Domestic Product for the third quarter fell by 3.5%; in the second quarter, the contraction was 0.1%. Two consecutive quarters of contraction are considered a "recession."
According to some economists, the decline will touch rock bottom in the fourth quarter. Bloomberg estimates foresee a contraction of 0.4% from October to December.
Among the reasons for the decline are the strong value of the yen, the reduction in demand from Europe, the anti-Japan demonstrations in China, affecting the sale of Japanese products, especially cars. Nissan and Honda have posted a 20% reduction in their profits for this year due to low sales in China.
The economic problems are also troubling the election campaign. Shinzo Abe, of the Liberal Democratic Party, currently in opposition, is pushing for greater stimulus measures from the government and an "unlimited" supply of money. He also questions the idea of the present government of Noda, approved by parliament, to raise direct taxes to 8% in 2014 and 15% in 2015.
According to Bloomberg, the last raising of taxes, in 1997, resulted in a recession that lasted at least 20 months.