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The emergency, currently set to last until May 11, is expected to dramatically impact industries such as tourism and retail that were hopeful ahead of the Golden Week holidays, reports Kazuaki Nagata. Prefectural leaders are already calling for more aid for businesses.

The third emergency threatens to nip hopes of an economic recovery in the bud, with some economists already forecasting a contraction for Japan in the current quarter.

University of Tokyo economists estimate that the capital alone could take an extra ¥4 trillion economic hit if highly contagious coronavirus variants spread quickly across the city, though the impact could be mitigated if infections are slowed.

People visit a department store in Tokyo's Ginza district on Saturday. The government is asking department stores to halt operations during the state of emergency except for food sales. | KYODO
People visit a department store in Tokyo’s Ginza district on Saturday. The government is asking department stores to halt operations during the state of emergency except for food sales. | KYODO

Things had been looking up for the Japanese economy, judging by some yardsticks: Exports posted a double-digit gain for the first time in years last month, while dropping consumer prices seemed to be stabilizing and wholesale prices rose in March after a year of declines.

In fact, while many workers are suffering — 700 restaurants failed last year and pandemic-linked job losses have surpassed 100,000 — Japan saw the fewest bankruptcies for 30 years in 2020. Predictions that the Nikkei would hit an all-time high may now seem misguided, but don’t cry for Japan’s megarich, either, who saw their wealth grow by 48% last year on the back of rising stocks.

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