The Bank of Japan's latest quarterly "tankan" survey of business sentiments, conducted in September, provides further evidence that the Japanese economy is slowly recovering from its worst postwar recession. Leading the recovery are large corporations riding the crest of the information-technology revolution.
The confidence index for large manufacturers has improved for seven consecutive quarters, with the percentage of those that believe the business condition is "good" exceeding the percentage of those that believe it is "bad" for two straight quarters. This is shown partly by upward revisions in their capital spending plans for fiscal 2000.
The overall picture is mixed, however. The nonmanufacturing sector, particularly the retail business, remains in the doldrums, as evidenced by stagnant consumer spending. Even in the pace-setting big-business manufacturing sector, the mood is expected to improve only mildly in the October-December quarter. Generally, the recovery lacks strength. What is more, world economic prospects are now clouded by uncertainties such as higher oil prices and slowdowns in the United States, Europe and Asia.