Skip to main content


Hitachi Research Institute

Economic Outlook

Latest economic forecasts for Japan, the U.S., Europe, and China, etc

Dec. 2012 Short,Medium and Long-term Economic Outlook Summary

[Short-term] Full-fledged recovery from the financial crisis to be driven by the U.S. economy

4 years and 3 months have passed since the financial crisis started in September 2008. In comparison to the Great Depression in the 1930's, the situation is worse in Britain where fiscal austerity was forced through, while in the U.S. and elsewhere, a return to the Great Depression was averted thanks to economic stimulus, albeit insufficient. In 2012, Europe and Japan fell into recession, however, it appears a worldwide economic recession was avoidable. The European sovereign debt crisis is abating because of the bold monetary policy implemented by the European Central Bank (ECB) and relaxation of Greece's economic reform targets, etc. It also appears the economic recession in Japan will soon hit bottom. Furthermore, in the U.S. economy that was epicenter of the financial crisis, employment continues to improve gradually and prospects for an adjustment of the excessive household debt became visible. Meanwhile, the sluggish growth of the Chinese economy is coming to an end.
Therefore, the world economy in 2013 is forecast to improve. The real GDP growth rates for the world economy are forecast to be 3.3% in 2012, 3.7% in 2013, and 4.0% in 2014. However, there are also various risks. In the U.S., there is the “fiscal cliff”, while in China, there are worries about tension related to high growth in the economic/financial/society fields bubbling to the surface. If these risks can be avoided, real GDP growth rates for the U.S. are forecast to be 2.2%, 2.3% and 4.4% respectively, and recovery for the U.S. economy is expected to accelerate and drive the world economy in the latter half of 2013. In the eurozone, the real GDP growth rates are forecast to be -0.5%, -0.5%, and -0.2% and the negative growth rates are expected for 3 consecutive years. For China, the real GDP growth rates are forecast to be 7.7%, 8.1% and 7.6% while in Japan, the real GDP growth rates are estimated to be 1.9%, 1.9% and 0.8%. (1.1% for fiscal year 2012, 1.8% for fiscal year 2013 and 0.8% for fiscal year 2014.)

[Medium-to-long term: World Economy] Emerging countries will be the medium-to-long term driving force of the world economy as they become middle-income countries.

Entering the 21st century, the world economy has significantly expanded since populous countries such as China and India started growing economically one after another. This growth trend in emerging countries overcame the financial crisis in 2008 and will continue to 2020 but will slow due to population aging and high currency rates toward 2030. However, overall, the growth will continue at a relatively high level. The driving force behind this growth trend are emerging countries which are becoming middle-income countries. In 1990, low-income countries with a 1,000 USD or less per capita gross national income (threshold in 2010) occupied 64% of the world's population. However, this rate will be 9% in 2030 and most of these countries will be middle-income countries comprising 78% of the world's population.
This trend will see the center of world trade shifting to emerging countries. In addition, 97 cities with populations of 1 to 5 million and 18 major cities with populations of more than 5 million will be created in the world. This urbanization will also promote growth. On the other hand, global environmental problems will turn serious. The target to check the rise in worldwide temperatures by 2 degrees Celsius in 2100 by reducing CO2 will be impossible to meet and temperatures will rise 3 to 4 degrees Celsius in the current state. The resulting shortage of water and accompanying increase in crop prices will suppress growth.
The real global GDP growth rate of the world, still reeling from effects of the financial crisis, is forecast to be 3.8% in the first half of the 2010's and is expected to be 4.3% in the latter half of the 2010's when a repercussion from the first half is expected. The forecast for the 10 years comprising the 2020's is 3.6%. These real global GDP growth rates will be driven by the economies of emerging countries, and real GDP growth rates for emerging countries are expected to be 5.6% in the first half of the 2010's, 5.4% in the latter half of the 2010's, and 4.6% for the 10 years comprising the 2020's. In particular, the real GDP growth rates for China are expected to be 8.0%, 6.5% and 4.5%. In addition, the U.S. is also expecting growth due to innovations such as shale gas, therefore, the real GDP growth rates are forecast to be 3.1%, 3.7% and 2.5%, and the U.S. is expected to drive the world's economy in the latter half of the 2010's.

[Medium-to-long term: Japanese economy] Low growth due to the super-aging of society

The labor force of Japan cannot help but decrease due to the aging population even if the rate of participation in the workforce by women and seniors rises. The remaining sources of economic growth are capital strength and total factor productivity, and the best hope in particular is innovation such as technical innovation and regulation reform. Even if we include these sources, the growth potential of Japan is 1.0% to 0.8%.
The structural change associated with a slow growing economy is significant. For industrial structure, the manufacturing industry will become further hollowed out, and the composition rate of employees in the service industry is forecast to expand to 41% in 2030. To reduce the financial deficit, the consumption tax needs to be raised to 15% by 2020 to cover the rapid increase in social security costs. In addition, due to the increase of the senior citizen demographic, the savings rate of Japan will turn negative and demand for housing will also fall. As a result, a current account deficit is expected in the mid-2020's. However, the speed will ease to some degree due to an increase in foreign income. It is also necessary to emphasize Gross National Income (GNI) which takes foreign income into consideration. The real GDP growth rate is forecast to be 1.1% for the first half of the 2010's, 1.0% for the latter half of the 2010's, and 0.8% for the 2020's. The Yen versus U.S. dollar exchange rate is forecast to remain at the same level after the Yen corrects to 90 yen/dollar from its current historical high.

Back Number

Jun 24, 2024
Mar 13, 2024
Jan 10, 2024
Dec 25, 2023
Oct 3, 2023
Jun 26, 2023
Mar 20, 2023
Jan 17, 2023
Oct 13, 2022
Jul 7, 2022
Apr 6, 2022
Jan 18, 2022
Oct 11, 2021
Jul 15, 2021
May 3, 2021
Jan 28, 2021
Oct 16, 2020
Jul 8, 2020
Mar 13, 2020
Jan 14, 2020
Oct 23, 2019
Jul 3, 2019
Mar 18, 2019
Jan 18, 2019
Nov 13, 2018
Jul 27, 2018
Apr 7, 2017
Apr 7, 2017
Sep 14, 2016
Jul 22, 2016
Jul 19, 2016
Apr 4, 2016
Feb 5, 2016
Oct 13, 2015
Jun 30, 2015
Oct 27, 2014
Jun 30, 2014
Apr 3, 2014
Feb 5, 2014
Oct 3, 2013
Jun 6, 2013
Apr 5, 2013
Dec 19, 2012
Sep 24, 2012
Jul 27, 2012
Sep 16, 2011
Jul 21, 2011
Jan 21, 2011
Sep 16, 2010
Jun 10, 2010
Mar 12, 2010
Dec 25, 2009
Sep 1, 2009
Jun 16, 2009
Mar 9, 2009
Dec 24, 2008
Nov 28, 2008
Jun 20, 2008
Mar 31, 2008
Jan 11, 2008
Jan 9, 2008
Nov 26, 2007