Japan's GDP: Yikes!

Just as the various emerging market financial crises of the 1990s demonstrated the dangers of dependence on capital inflows, the present global recession is revealing the risks of relying on exports. The latest news on Japan's GDP is staggering, as the Times reports:

Japan confirmed Wednesday what many had long suspected: that the world’s second-largest economy contracted at a record pace during the quarter that ended March 31, as exports collapsed and companies cut back production.

The Japanese gross domestic product shrank 15.2 percent on an annualized basis. It marked a fourth straight quarter of contraction and the biggest decline since Japan began keeping records in 1955.

It was also a deeper fall than during the last quarter of 2008, when the economy shrank a revised 14.4 percent on an annualized basis.

With shipments overseas down 26 percent from the previous quarter, export-dependent Japan has been harder hit than the United States and Europe as demand evaporated amid the global economic turmoil.

The Japanese contraction in the last quarter from the previous quarter — 4 percent — compares to 1.6 percent shrinkage in the United States and a 2.5 percent fall in the euro zone.

Update (5/22): Germany: -14.4%, Mexico: -21.5% (annual rates).