Japan, Learn How to Measure Your Own Weight!

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Japan, Learn How to Measure Your Own Weight!

There are two ways to increase the temperature of a cool room. One is to turn up the heat of the room and the other is to blow at the thermometer on the wall to make the mercury column go up. Even a mere child knows which way is the right one.

However, the Japanese government has been internationally humiliated for using the wrong method--a method that even a child would reject as unreasonable.

The New York Times reported on the 24th that the Economic Planning Agency of Japan had omitted financial institutions' lowered capital investments into their calculations, resulting in a higher then expected fourth quarter Gross Domestic Product (GDP) growth rate of 0.2%. The New York Times suspected that ministers ommitted the figure for political purposes, namely, to meet with last year's government's goal of 0.6% annual GDP growth rate.

The Japanese government has repeatedly denied the accusations. Officials responsible for the GDP figure explain, "the financial institution's capital equipment investment rate decreased so drastically that we decided it would not have any kind of effect on the statistics, and therefore we excluded it. "

However, on the 25th, day after the report, Japan hastily declared the correct figure when the exchange rate of the Yen abruptly fell to 108 yen to the dollar. The new figure was lower by 0.2%, which was exactly the amount that the New York Times reported. Japanese officials explained the sudden reversal as follows, "coincidentally, the results of a detailed inspection were released today so we decided to include it in the statistics."

The GDP growth rate is an economic index with a very broad impact on the international economy. Japan’s figure is even more important, considering the huge economy that the nation possesses. It cannot be excused in any way when an index this important, was wrongly calculated and then changed the very next day. Not only does this affect the people who have invested in the hope of a recovery of Japan's economy, but it also affects Asian exporting nations.

Japanese GDP statistics have been well known to be some of the sloppiest in the world. This is because the politicians use it as a political tool.

It will be hard for the economically powerful Japan to avoid being called nothing but an 'obese economy', if they fail to measure their own weight and must rely on the foreign press to evaluate the true state of the Japanese economy.

by Nam Yoon-ho

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