Japan is officially in recession according to Cabinet Office figures released on November 17. The world's second largest economy shrank for a second consecutive quarter in the July-September period as the global financial crisis took a heavy toll on business confidence and investment.

Japan's gross domestic product (GDP), shrank 0.1 percent in the third quarter, and by an annualized 0.4 percent, by comparison with forecasts of a 0.1 percent quarterly rise and annual growth of 0.3 percent.

Consumer spending, which accounts for about 55 percent of Japan's GDP, saw a 0.3 percent rise in real terms from the previous quarter, but capital spending, a main driver of Japan' s six-year economic recovery since 2002, slipped 1.7 percent.

The Japanese economy has been hit simultaneously by falling demand for exports as major world economies shrink, and a rise in the value of the yen which, along with the dollar, is seen by investors as a safe haven in the financial storm.

Japan's Asian neighbors Singapore and Hong Kong are already officially in recession. Last week the Eurozone announced its first aggregate recession since the euro was introduced.

(China.org.cn by John Sexton, November 17, 2008)