BEIJING - China may overtake Japan as the world's second-largest economy this year, but it remains a developing economy despite its fast pace of growth, economists said.
Japan's nominal gross domestic product (GDP), which is not adjusted for price and seasonal variations, was worth $1.286 trillion in the April-to-June quarter compared with $1.335 trillion for China, according to data released by the Japanese government on Monday. The figures are converted into dollars based on an average exchange rate for the quarter.
Japan's GDP grew at an annualized rate of just 0.4 percent, the government said, far below the annualized 4.4 percent expansion in the first quarter and adding to evidence the global recovery is facing strong head wind.
China has surpassed Japan in quarterly GDP figures before, but this time it is unlikely to relinquish the lead, AP reported.
China's economy will almost certainly be bigger than Japan's at the end of 2010 because of the huge difference in each country's growth rates. China is growing at about 10 percent a year, while Japan's economy is forecast to grow between 2 to 3 percent this year.
The gap between the size of the two economies at the end of last year was already narrow. Chinese economists estimated China's leading advantage would maintain through the rest of 2010, reinforced by its usually more vibrant economy in the fourth quarter and possible yuan appreciation.
Japan has held the No 2 spot behind the United States since 1968, when it overtook West Germany. From the ashes of World War II, the country rose to become a global manufacturing and financial powerhouse. But its "economic miracle" turned into a massive real estate bubble in the 1980s before imploding in 1991. China Daily