Japan’s Economy To Shrink By 3%

The world’s second largest economy, Japan, said their economy is likely to shrink 3.3% this fiscal year, Manufacturing.Net reports. “Exports and production are falling drastically, while employment conditions are rapidly worsening. Financing for businesses is also severe, and it is correct to say that Japan is in the middle of a financial crisis,” said Japan’s Finance Minister Kaoru Yosano.

Japan has heavily relied on foreign sales of its cars and gadgets to drive economic growth, and is reeling from the collapse in global demand sparked last year by the U.S. financial crisis. Its economy shrank an alarming annual 12.1% in the October-December quarter, marking the steepest contraction since the oil shock of 1974.