Japan Determined to Beat Tsunami Crisis: Analyst
The Japanese people are fighting hard to get the economy out of the slump which has followed a massive earthquake and tsunami in March, a Nomura analyst told CNBC Monday.
Alastair Newton, senior political analyst at the Japanese bank, who has just returned to London from Tokyo, said that the mood in the country is determined despite the devastation caused by the disaster.
"If you look out of your hotel room in Tokyo, there are a lot of black patches where clearly previously there was a lot of light," he said.
"There was a lot of despair over the political situation and the return to politics as normal."
He pointed out that Japan has come through natural disasters before, notably the 1888 eruption of Mount Bandai which killed hundreds of people.
The world's third-largest economy has slumped since the earthquake and ensuing tsunami, although it is hoped that the third quarter will see a return to moderate growth.
The IMF forecast that while GDP will decline by 0.7 percent this year it will grow by 2.9 percent in 2012.
Philip Poole, Global Head of Macro & Investment Strategy at HSBC, believes that the Japanese recovery is progressing more quickly than expected.
"With the corporate sector generally in good shape and profitability set to pickup we continue to see value and, subject to global risks, scope for valuations to move higher in the course of the coming months," he wrote in a note Monday.
Japanese exports rose in June, bringing the trade balance back to surplus, as industrial production started to recover. The Nikkei is now back within 2 percent of the level just before the earthquake struck.
In recent months, carmakers Toyota and Honda have reported hefty falls in production as a result of the disaster.
Toyota, the world's biggest maker of cars, said that production was down 15.9 percent from the previous year as it struggled to make enough of the parts needed for its cars, while production at Honda has halved.
Rivals Nissan and Mitsubishi have done better, with production rises of 1.9 percent and 8.1 percent. Nissan chief executive Carlos Ghosn predicted that its factories will be back to full production by October.
"I found a real determination to come out of this crisis and build a better functioning Japan going forward," Newton said.
"I was particularly impressed by the number of young people giving up their summer vacations to go to the disaster zone to do relief work. There are a lot of people in Japan who have realized that you can't look to others to get Japan out of economic turmoil."