Japan to revise projected FY 2009 GDP growth down to 3% contraction

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TOKYO, April 21 Kyodo -
Japan plans to revise its projected real gross domestic product growth rate for
fiscal 2009 downward to a contraction of around 3 percent to reflect the global
economic downturn, government sources said Tuesday.
In December, the government projected zero growth for the year that began April
1, but it is making the rare move to revise the initial outlook to negative
growth amid the continued U.S. economic downturn, according to the sources.
Japan's real GDP growth rate is expected to fall below zero for the second
straight fiscal year, and the revised projection will be the worst real GDP
growth rate since the end of World War II, going below the 1.5 percent
contraction in fiscal 1998.
The government does not normally revise its projection for the real GDP growth
rate to negative growth or review its outlook at the start of a fiscal year
when the effectiveness of its measures are yet unknown.
But Japan envisages that it will be unable to avoid a negative growth of about
4 to 5 percent due to the slumping U.S. economy unless it takes special fiscal
steps, according to the sources.
It apparently calculated the revised figure by anticipating that its new
stimulus package would offset the contraction about 2 percent, the sources
said.
GDP is the total value of goods and services produced domestically. Real GDP
figures are adjusted for price and seasonal variations.
==Kyodo