(CNN) -- As the G-20 meet wraps up, many leaders -- including U.S. President Barack Obama -- will take a short flight from Seoul, Korea, to Yokohama, Japan, for a summit of Asia-Pacific leaders.
They are taking a flight into the feared future of the developed world.
Japan's economy is beset by the three D's that other nations long to avoid: Deflation, staggering deficits and aging demographics.
"Japan is the one facing the worst problems," says Piero Ghezzi, managing director and head of emerging markets research at Barclay's Capital.
"After Japan are the fragile European countries that are in very dire straits: Greece, Ireland and Portugal ... Spain and Italy, too, but their problems are of a different order," Ghezzi said. "After that, the U.S.".
Leaders from 21 Pacific Rim nations are gathering Saturday in Japan for the annual APEC (Asia-Pacific Economic Cooperation) summit.
It's the first summit since China became the world's second largest economy this year, taking a mantle Japan held since 1968 when its economy soared out of the ashes of World War II. The bubble burst in 1989, and the country has achieved only anemic growth.
Japan is saddled with the world's largest government debt baggage -- estimated to be 225 percent of GDP, and forecast to grow to 250 percent by 2015. By comparison, the U.S. debt is 93 percent of GDP, UK debt is 76 percent and for China it's 19 percent.
"Japan has additional problems like terrible demographics," Ghezzi said.
The aging population means fewer replacement workers who must shoulder the burden of public debt.
"The number of young people supporting one elderly is going to be 2-to-1 in the very near future," said Kathy Matsui, Chief Japan Strategist for Goldman Sachs Japan. Japanese governmental figures show 40 percent of the population will be over the age of 65 by 2050.
"Unless you allow immigration, it's very difficult to reverse," Ghezzi added. "It's structural, and almost irreversible".
To be sure, Japan remains a strong economy -- although it has slipped to the third largest this year -- there are no likely contenders to knock it further back in the global pecking order in the near future.
CNN
