Claims of big success by 'Abenomics' are a fake

The claims ‘Abenomics’ is a big success are so far fake.

Headlines have appeared such as ‘Japan revises up Q1 growth to annual 4.1%’ with commentary this, ‘was much higher than the preliminary estimate of 3.5 per cent, which was already the fastest rate recorded by any Group of Seven economy.’ This ignores that this annualized 4.1% growth in the 1st quarter of 2013 was only recovery from a 3.6% fall in the second quarter of 2012.

Year on year GDP growth in Japan in the 1st quarter of 2013 was only 0.2%, the lowest since the 4th quarter of 2011 – see Figure 1, Table 1, and Figure 2

Figure 1

Table 1

Figure 2

Japan’s GDP remains 1.2% below its peak in the 1st quarter of 2008 and its recovery remains slow – Figure 3.

Figure 3

At best all ‘Abenomics’ has done so far is stop the renewed decline which commenced in Japan’s economy in 2011. But the ‘Abe recovery’ is simply in line with the trend since 2009. Only if the growth seen in the 1st quarter of 2013 continued for a significant period could ‘Abenomics’ really claim any significant success.

In short the claims to date of a big success by ‘Abenomics’ are fake.

John Ross is currently Visiting Professor at Antai College of Economics and Management,Shanghai Jiao Tong University, where he leads research on globalisation and on China and the international financial crisis.
Check out his blog: http://ablog.typepad.com/keytrendsinglobalisation/ , or follow him on twitter @JohnRoss43