Japan to Be Asia's Economic Growth Driver Again

The Japanese economy, which is now growing five times faster than that of the US, is poised to regain its role as Asia's key growth driver, says Asian Development Bank (ADB) chief Haruhiko Kuroda.

Japan posted a blistering 5.5 per cent annualised economic growth rate in the fourth quarter of 2005, the government said on Friday. It gave added weight to evidence that Asia's largest economy has finally emerged from more than a decade of stagnant growth with bouts of recession.

"I think the Japanese economy has recovered, and it can continue to grow by 2-3 per cent (annually) in the next several years. Although such growth is not as big compared with China or India," Kuroda said, "since the size of Japan's economy is huge - it is three times bigger than China's - even a 2-3 per cent rate could provide enough growth momentum. Not only China and India but also Japan will be an engine of growth for Asia and the world," he said.

The Japanese economic rebound has been so robust that some are predicting the country will outperform the US in 2006 for the first time since 1991.