Nearly 40% of polled firms expect double-dip recession

Last Updated: Sunday, January 3, 2010 - 14:31

Tokyo: Nearly 40 percent of major Japanese
companies polled in a survey have said that the Japanese
economy is "highly likely" or "likely" to fall into a
double-dip recession, according to survey results.

According to survey results compiled yesterday, 40 firms,
or 37 percent of the 109 leading Japanese companies anticipate
a further downturn in economic activity in Japan. Companies
including Canon Inc., Nippon Steel Corp., Nippon Oil Corp.,
Sony Corp., Toyota Motor Corp. and Mitsubishi UFJ Financial
Group Inc. were surveyed from late November to mid-December.

To a multi-reply question about reasons for the gloomy
outlook, 26 of the 40 companies attributed it to the yen`s
appreciation. Twenty-four firms said the effects of stimulus
measures adopted by the government will wane, while 23
referred to deepening deflation.

But 56 of the 109 companies, or about 51 percent, said
they expect the domestic economy to stage a full-scale rally
in the second half of 2010.

The survey also found that 61 companies see the current
economy as leveling off while 17 said it is slowing down. In
contrast, 31 firms regard the economy as gradually expanding.

With regard to the economic policy of the Japanese
government led by the Democratic Party of Japan, 48 companies
want to see a clear roadmap toward medium- and long-term
growth.

Among other survey findings, 20 companies are planning to
cut back on capital spending in fiscal 2010, while 33 firms
are considering workforce reductions.

PTI



First Published: Sunday, January 3, 2010 - 14:31

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