BANGKOK: Bangkok city employees have been told to work from home to avoid harmful air pollution, as a layer of noxious haze blanketed the Thai capital on Thursday (Feb 15). City authorities asked for cooperation from employers to help workers in the city of some 11 million people avoid theContinue Reading
TOKYO: Once forecast to become the world’s biggest economy, Japan slipped below Germany last year to fourth place, official data showed on Thursday (Feb 15), although India is projected to leapfrog both later this decade. Despite growing 1.9 per cent, Japan’s nominal 2023 gross domestic product in dollar terms wasContinue Reading
Economy minister Yoshitaka Shindo stressed the need to achieve solid wage growth to underpin consumption, which he described as “lacking momentum” due to rising prices.
“Our understanding is that the BOJ looks comprehensively at various data, including consumption, and risks to the economy in guiding monetary policy,” he told a news conference after the data’s release, when asked about the impact on BOJ policy.
Japan’s nominal GDP stood at US$4.21 trillion in 2023, falling below US$4.46 trillion for Germany to rank as the world’s fourth-largest economy, the data showed.
“The overtaking … in size in dollar terms owes a lot to the recent collapse in the yen. Japan’s real GDP has actually outperformed Germany’s since 2019,” said Fitch Ratings economist Brian Coulton.
Germany’s heavily export-dependant manufacturers have been hit particularly hard by soaring energy prices in the wake of Russia’s invasion of Ukraine.
Europe’s biggest economy has also been hampered by the European Central Bank raising interest rates in the eurozone as well as uncertainty over its budget and chronic shortages of skilled labour.
Japan is also heavily reliant on exports, in particular cars, although the weak yen – making exports cheaper – has helped big firms like Toyota offset weakness in key markets such as China.
But it is suffering more than Germany in terms of worker shortages as its population falls and birth rates remain low, and economists expect the gap between the two economies to widen.
“Like Japan, Germany’s population has been declining, but it has nevertheless achieved steady economic growth,” said Toshihiro Nagahama, economist at Dai-ichi Life Research Institute.
“This is because, especially since the 2000s, the government authorities in Germany have been actively implementing policies to create an environment that makes it easier for companies to operate in the country,” he said.
During its boom years of the 1970s and ’80s, some projected that Japan would become the world’s biggest economy.
But the catastrophic bursting of Japan’s asset bubble in the early 1990s led to several “lost decades” of economic stagnation and deflation.
When in 2010 Japan was overtaken as number two by Asian rival China – whose economy is now around four times larger – it prompted major soul-searching.
While largely a product of the yen’s slide, falling behind Germany will still be a blow to Japan’s self-esteem and add to the pressure on unpopular Prime Minister Fumio Kishida.
More humiliation is to come with booming India projected to overtake Japan in 2026 and Germany in 2027 in terms of output – although not in GDP per capita – according to the International Monetary Fund.
Germany and Japan “are shrinking in terms of contribution to global growth in favour of faster-growing ones … because their productivity is already very high and it is very hard to increase it”, said Natixis economist Alicia Garcia-Herrero.
“Of course, both Germany and Japan could take measures to mitigate this. The most obvious one is allowing for more immigration or increasing the fertility rate,” she told AFP.
Japan “has not made progress in raising its own growth potential”, Japanese financial daily the Nikkei said in a recent editorial.
“This situation should be taken as a wake-up call to accelerate neglected economic reforms.”
In their campaign platform, Mr Prabowo and Mr Gibran pledged to uphold Mr Jokowi’s policies, emphasising “continuity” as the cornerstone of their political agenda.
Mr Jokowi’s influence would persist in a Prabowo administration via his eldest son, Mr Gibran. As the vice president, Mr Gibran’s role would be pivotal in shaping policy decisions, ensuring that Mr Prabowo’s administration remains under Mr Jokowi’s oversight.
Mr Prabowo’s priorities align closely with Mr Jokowi’s emphasis on advancing value-added manufacturing, expanding infrastructure, and developing the new capital, Nusantara. However, certain campaign promises, such as a free school lunch programme, should be taken with a grain of salt because they are unlikely to be financially viable and would potentially strain the state budget.
Under Mr Prabowo, Indonesia would continue to court foreign investment to foster economic growth. Mr Prabowo is likely to strengthen trade and investment ties with China, building on the groundwork laid by Mr Jokowi over the past decade.
However, closer economic cooperation with China will not come at the expense of weakened ties with other countries. Like his predecessors, Mr Prabowo would not compromise Indonesia’s foreign policy principle of non-alignment. He would continue to engage with all countries, as long as there are political and economic benefits coming from the cooperation.
The government has appealed to farmers to come forward to discuss their demands, with Agriculture Minister Arjun Munda saying that efforts will continue to speak to them “in a constructive and positive manner”. However, an influential farmers’ union linked with Modi’s party on Wednesday rejected demands raised by the protesting farmers. The leader ofContinue Reading
The Prabowo-Gibran ticket was supported by a coalition of nine political parties. His two opponents meanwhile are each supported by four parties.
With Mr Prabowo set to be the country’s next president, Mr Burhanuddin says he predicts his coalition will expand, attracting parties that originally supported Mr Anies or Mr Ganjar.
“Prabowo has said that he is willing to work with anyone,” he noted.
But academics and civil society groups – who have already lamented the erosion of democracy during the campaign – may be dismayed by such an outcome.
“I worry that there will not be any opposition (to Mr Prabowo’s presidency). Even if there is, it will be uneven and ineffective,” Mr Burhanuddin said.
Political analyst Mr Yoes Kenawas from Jakarta’s Atma Jaya University said that many Indonesians are also worried about the rise of political dynasties in Indonesia.
“This election has set a bad precedent,” Mr Yoes told CNA.
Mr Gibran was originally not qualified to run as the 2017 Law on Election stated that a presidential or vice presidential candidate must be at least 40 years of age.
However, the Constitutional Court in October – chaired by his uncle, then-chief justice Anwar Usman – ruled that the requirement does not apply to an elected public official. Gibran is currently the mayor of Surakarta, better known as Solo.
The court decision also sparked widespread protests across the nation.
There have also been allegations that Mr Widodo mobilised or condoned the mobilisation of public officers to support Mr Prabowo’s campaign.
“Indonesia is the third-largest democracy … we have celebrated, and played such an important role in promoting democracy in the region, the Association of Southeast Asian Nations, and also globally. Now Indonesia’s democracy is a big question mark to us, and for me I’m broken-hearted,” research professor Dewi Anwar Fortuna of the National Research and Innovation Agency (BRIN) told CNA’s election result show.
But as this election has shown many Indonesians are willing to look past the issue, Mr Yoes said, in exchange for programmes like cash aids for the poor and other incentives.
Mr Prabowo’s vote share, which surpasses that in pre-election surveys earlier this month, suggests the majority of the voters want a continuation of Jokowi’s policies, Mr Yoes said.
“Prabowo’s campaign has been effective to attract voters’ support, especially the young voters. The use of political gimmicks has been effective to shift the policy debates into likes and dislikes,” Mr Yoes said.
SEOUL: A South Korean court sentenced two former senior police officers on Wednesday (Feb 14) for destroying evidence linked to Seoul’s deadly 2022 Halloween crush – the first police officials to be sentenced over the disaster. Tens of thousands of people – mostly in their 20s and 30s – hadContinue Reading
ISLAMABAD: A political stalemate in Pakistan, after an inconclusive election, ended with Shehbaz Sharif chosen to lead the country again, while efforts were underway on Wednesday (Feb 14) to get the second-largest party to join the government to ensure stability. Sharif, 72, who was prime minister for 16 months untilContinue Reading
SEOUL: The former fiance of South Korean Olympic fencing medallist Nam Hyun-hee was sentenced to 12 years in prison for fraud on Wednesday (Feb 14) over a scandal that reverberated across the country last year. The former fiance, Jeon Cheong-jo, was arrested last year on charges of stealing over 3Continue Reading
SYDNEY: Solomon Islands is expected to next week call a national election for April, with China security ties emerging as a key issue as political parties launch campaigns in the Pacific Islands nation. Prime Minister Manasseh Sogavare switched diplomatic ties from Taiwan to China soon after the 2019 election thatContinue Reading