The joint declaration adopted Oct. 15 by the Group of 20 finance ministers and central bankers expressed a willingness to take resolute action to deal with the serious downside risks being faced by the global economy. But Japan, beset by the damage caused by the March 11 earthquake, tsunami and nuclear crisis, has posted three consecutive quarters of negative growth since October 2010.
Three consecutive GDP contractions would normally qualify as a recession for most economists, but given the extraordinary factors raised by the calamity, Japan has not officially been declared "in recession." In fact, the industrial output index for March fell as sharply as 15.5 percent from February but has since swung upward.
The three Tohoku prefectures hit hardest by the natural disasters — Miyagi, Iwate and Fukushima — account for a mere 4 percent of Japan's industrial production. Still, the massive damage to the industrial infrastructure of the region disrupted the supply chain of the manufacturing sector as a whole, resulting in the 15 percent plunge in March.