As with most countries, the COVID-19 pandemic has had a huge impact on the Japanese economy, with GDP growth contracting by 28% in the second quarter of 2020. While it showed a recovery of 23% in the third quarter, the economy still faces multiple challenges. A full revival depends largely on how many people receive vaccinations and whether concerns over the Tokyo Olympic and Paralympic Games – postponed until this summer – diminish.
But despite being the first of the world’s top three economies to officially fall into recession, the Japanese economy appears to be faring better than its main global counterparts, while Japanese industry’s reputation for innovation remains strong. The Japanese government announced a massive economic stimulus package in December, including unprecedented new measures such as a ¥2 trillion (nearly US$ 20 billion) Green Fund, mainly to assist ambitious green projects, as well as a Digital Fund to drive digitization.