Aging Japan Puts a Strain on the Financial System

By Gaston Gelos and Sònia Muñoz

August 10, 2017

Versions in 中文 (Chinese), 日本語 (Japanese)

Elderly shoppers in Tokyo’s Sugamo district: As Japan's population ages, demand for financial services shifts (photo: Issei Kato/Reuters/Newscom).

Japan’s population is shrinking and getting older, posing challenges to the nation’s financial system. How Japan copes could guide other advanced economies in Asia and Europe that are grappling with the same trends but are at an earlier phase of similar demographic developments.

Continue reading “Aging Japan Puts a Strain on the Financial System” »

A Firming Recovery

By Maurice Obstfeld

July 24, 2017

Versions in عربي (Arabic), Bahasa (Indonesian),  中文 (Chinese), Français (French), 日本語 (Japanese), Русский (Russian), and Español (Spanish)

(photo: IMF)

The recovery in global growth that we projected in April is on a firmer footing; there is now no question mark over the world economy’s gain in momentum.

As in our April forecast, the World Economic Outlook Update projects  3.5 percent growth in global output for this year and 3.6 percent for next.

The distribution of this growth around the world has changed, however: compared with last April’s projection, some economies are up but others are down, offsetting those improvements. Continue reading “A Firming Recovery” »

What We Have Seen and Learned 20 Years After the Asian Financial Crisis

By Mitsuhiro Furusawa

July 13, 2017

Versions in  عربي (Arabic), Bahasa (Indonesia),  中文 (Chinese), Español (Spanish), Français (French), 
日本語 (Japanese), Русский (Russian)

A trader in Seoul, South Korea: Asia is the largest contributor to global growth (photo: Ryu Seung-il/Polaris/Newscom)

Asia today is the fastest-growing region in the world, and the largest contributor to global growth. It has six members of the Group of Twenty advanced and emerging economies, and its economic and social achievements are well recognized.

But 20 years ago, July 1997 marked the beginning of the Asian Financial Crisis, when a combination of economic, financial and corporate problems triggered a sharp loss of confidence and capital outflows from the region’s emerging market economies. The crisis began in Thailand on July 2, when the baht’s peg to the dollar was dropped, and eventually spread to Korea, Indonesia and other countries. Continue reading “What We Have Seen and Learned 20 Years After the Asian Financial Crisis” »

Higher Policy Uncertainty Could Be Bad News for Japan’s Economy

by  Elif C. Arbatli, Steven J. Davis, and Arata Ito

May 30, 2017

Version in  中文 (Chinese), 日本語 (Japanese)

Policy uncertainty remains a challenge in Japan, and can harm the country’s economic performance according to a new IMF study. The good news is that credible plans for taxation, spending and structural reforms, as well as greater clarity about monetary policy can reduce uncertainty. Continue reading “Higher Policy Uncertainty Could Be Bad News for Japan’s Economy” »

Chart of the Week: The Cost of Asia’s Aging

By IMFBlog

May 1, 2017

Versions in 中文 (Chinese), Bahasa (Indonesia), and 本語 (Japanese) 

When it comes to tackling demographic change in Asia, there’s no one-size-fits-all strategy for policymakers. In some countries, like Japan, the population is aging rapidly, and the labor force is shrinking. In others, like the Philippines, young people are flooding the job market in search of work.

As our chart shows, the impact of aging could potentially drag down Japan’s average annual GDP growth by 1 percentage point over the next three decades. While in India and the Philippines, which have some of the youngest populations in the region, a growing workforce could potentially increase GDP by that same amount. Continue reading “Chart of the Week: The Cost of Asia’s Aging” »

How an Extended Period of Low Growth Could Reshape the Financial Industry

By Gaston Gelos and Jay Surti

Versions in  عربي (Arabic), Français (French), Русский (Russian), and Español (Spanish)

What happens if advanced economies remain stuck in a long-lasting funk marked by tepid growth, low interest rates, aging populations and stagnant productivity? Japan offers an example of the impact on banks, and our analysis suggests that there could also be far-reaching consequences for insurance companies, pension funds, and asset-management firms.

Continue reading “How an Extended Period of Low Growth Could Reshape the Financial Industry” »

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