Japan enters recession, markets sceptical about G20

JAPAN: Japan became the latest major economy to sink into recession as markets gave a lukewarm response to an action plan from international leaders to tackle the global financial crisis.

The Group of 20 rich and emerging nations pledged to work together to restore global growth and overhaul the world’s financial system, but stopped short of announcing specific measures such as coordinated stimulus spending.

“In the midst of an emergency crisis, to have a statement that reads ‘We will cooperate with each another’ is all but meaningless,” said Daisuke Uno, chief strategist at Sumitomo Mitsui Banking Corp.

The leaders vowed to use government spending to reverse a spreading recession, to press for a global trade deal to ward off protectionism and to reform financial regulation and world financial institutions. Many market players had been hoping for more specific steps to try to prevent the worst financial crisis in decades pushing the global economy into a long and deep recession.

Tokyo, Monday, AFP