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The government said Friday the world’s second-largest economy will expand for the first time in three years in fiscal 2010, affirming forecasts released Dec. 25.

Gross domestic product will probably expand 1.4 percent in the period starting April 1, after contracting an estimated 2.6 percent this year, the Cabinet Office said. Prime Minister Yukio Hatoyama’s government released the figures last month with its budget proposal and formally approved them Friday at a Cabinet meeting.

Government expenditure will probably fall 0.6 percent next year after rising 4.3 percent, the report showed. Employee compensation is forecast to fall 0.7 percent, the fourth year of decline, the report showed. It probably slid a record 3.9 percent in fiscal 2009, government officials said.

Capital spending will probably rise 3.1 percent next year after declining an estimated 16.5 percent, the officials said.

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