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Japan 4th Quarter GDP Confirms China as 2nd Biggest Economy

   Mil Arcega | Washington  February 14, 2011
   Workers  rest near a loaded cargo ship at the Tianjin port in China. A
   Chinese  state news agency said the country's trade surplus in January
   narrowed sharply to $6.5 billion, February 14, 2011

Photo: AP

   Workers  rest near a loaded cargo ship at the Tianjin port in China. A
   Chinese  state news agency said the country's trade surplus in January
   narrowed sharply to $6.5 billion, February 14, 2011

   Latest  Japanese  government  estimates  show that China has overtaken
   Japan  as  the  world's  second  largest  economy.  Japanese officials
   confirmed  the  estimates  Monday,  when  they announced the countryâs
   gross domestic product, the broadest measure of its economy, shrank in
   the final three months of 2010.
   The  statistics  say  the  country's  economy  declined 0.3 percent as
   domestic  consumption  slowed  down.   But Japanese Economic Minister
   Kaoru  Yosano  says  the  decline  is  temporary.  "The data confirmed
   Japanâs  economy  was  standing  still  in  the  October  to  December
   quarter.   But  we  now  see  signs of the economy picking up, as car
   sales and production seem to have bottomed out," he said.
   Although  Japan's  economy still managed to beat expectations, growing
   3.9  percent  for  the  calendar  year,  it wasnât enough to maintain
   Japanâs 40-year lock as the worldâs second largest economy.
   That  title  now  belongs  to China, with a total domestic output last
   year of nearly $5.88 trillion  - compared to Japan's $5.47 trillion.
   Beijing  economist  Sang  Baichuang  says  the  figures  are  good for
   bragging  rights,  but  in  terms of purchasing power, he says Chinese
   consumers  lag  well behind those in Japan. "Our economy surpassed the
   Japanese  economy, but our average GDP per capita is only one-eleventh
   of  the  Japanese  economy.   So we cannot be satisfied only with the
   total GDP.  Chinaâs economic prosperity is still relatively smaller,"
   Baichuang said.
   Analysts  say  Japanâs  third place ranking comes as no surprise given
   Chinaâs large population of 1.3 billion people.  In contrast, Japanâs
   population is nearing 130 million.
   Bank economist Masayuki Kichikawa says Chinaâs growing economy is good
   for Japan, because it will mean more consumers for Japanese goods.
   "This  should  be  viewed  more  positively  from the viewpoint of the
   Japanese  because  probably Chinese people would begin to consume more
   high-end durable goods such as automobiles.  And probably China would
   become a very good market for Japan," said Kichikawa.
   Despite the global downturn, economists credit Chinaâs booming economy
   for  helping  to  boost growth around the world, including the worldâs
   biggest  economy  -  the  United  States, which has an annual domestic
   output nearly three times the size of Chinaâs.

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