TOKYO: Japan’s economy grew twice as fast as originally estimated in the third quarter thanks to big gains in capital expenditure, revised data showed on Friday, with expansion seen to continue thanks to buoyant exports.
The economy grew an annualized 2.5 percent in July-September, handily beating the preliminary reading of 1.4 percent annualized expansion. The capital expenditure component of gross domestic product was revised to a rise of 1.1 percent from the previous quarter, well over the forecast 0.4 percent growth, and soaring above the preliminary 0.2 percent reading.
Economists say the rate of growth reported on Friday is unsustainable, but they are still confident that the economy will continue to expand next year at a moderate pace.
“The economy is doing well, but annualized growth above 2 percent seems a little too quick,” said Norio Miyagawa, senior economist at Mizuho Securities.
“I expect that exports and capital expenditure will lead growth next year, but the pace will moderate to around 1 percent.”
Japan’s economy has expanded for seven consecutive quarters, and many economists expect growth to continue as consumer spending gains strength and export growth is seen on track to continue.
“You can say Abenomics is doing well and producing results. Monetary policy is contributing to nominal growth. Revisions to past data show the government’s fiscal spending had a bigger impact than previously thought. The structural reform that has made the most obvious impact is allowing more tourists to visit Japan,” said Hiroshi Miyazaki, senior economist at Mitsubishi UFJ Morgan Stanley Securities.
“The government can be satisfied with these numbers. Prices are not rising that much, which is a problem for the Bank of Japan, but at this point officials are starting to worry about how to exit from their easing.”
Friday’s updated third quarter data followed revised 2.9 percent annualized growth in April-June.
The initial second quarter data put annualized GDP growth at a stellar 4.0 percent, which was later revised down.
Friday’s revised third quarter figures showed that Japan is in its longest uninterrupted period of growth since comparable data became available in 1994.
This is a boon to the government as it is expected to agree later on Friday a spending package to subsidize education and encourage more corporate investment.
Friday’s figure translates into quarter-on-quarter growth of 0.6 percent, versus a preliminary reading of 0.3 percent growth and the median estimate for 0.4 percent growth.
Capital expenditure was revised up because wholesale companies and retailers are increasing investment to deal with increased inbound tourism, a Cabinet Office official told reporters.
Inventories contributed 0.4 percentage point in the third quarter, which was revised up from a preliminary 0.2 percentage point contribution, due to a build up of chemicals and plastics used in manufacturing, the official said.
Net exports contributed 0.5 percentage point in the third quarter, unchanged from the preliminary reading.
In one worrying sign, private consumption fell 0.5 percent in July-September, unchanged from the preliminary reading, as consumers spent less on cars, dining out, and mobile phone charges.
Weak consumption disappointed some economists who had expected a slight upward revision.
Real wages rose 0.2 percent in October marking their first rise since December 2016 in a sign a tight job market may finally be leading to higher salaries.
Japan’s third-quarter GDP growth beats forecast, grows twice as fast
Japan’s third-quarter GDP growth beats forecast, grows twice as fast
Using space science to protect Saudi Arabia’s environment
- Kingdom is harnessing satellite technology to forecast disasters, boost agriculture
RIYADH: Learning space science has delivered significant environmental benefits worldwide, helping many countries better understand and manage climate challenges.
Saudi Arabia is now taking steps not only to explore the galaxy but also to invest in future generations who can apply space science to pressing environmental issues at home.
Last November, the Space Academy, part of the Saudi Space Agency, launched a series of seminars designed to enhance knowledge and develop skills in space science and technology, with a particular focus on Earth observation.
Running for nearly a month, the program formed part of a broader strategy to nurture national talent, raise scientific awareness, and build data capabilities that support innovation and research across the Kingdom.
As efforts to strengthen the sector continue, important questions remain: How can space science translate into tangible environmental benefits? And how large is the global space economy?
In an interview with Arab News, Fahad Alhussain, co-founder of SeedFord, highlighted the scale of the opportunity and its environmental impact.
“To be frank, the slogan that we always use in space is that ‘saving the Earth from the space.’ It is all about this,” Alhusain told Arab News.
“You can recall a lot of related environmental issues like global warming, related to forests, related to the damage that happens to the environment. Without space, it would be almost impossible to see the magnitude of these damages.”
According to Alhussain, satellites have transformed how experts observe environmental changes on Earth, offering a comprehensive view that was previously impossible.
He said that “the transformation of technology allows even the non-optical ways of measuring, assessing, and discovering what is going on in the environment … you can even anticipate fire before it happens in the forest.”
“You can detect the ice-melt down, you can get huge amount of information and can see it through the weather maps…there is a huge section in the economy for the environment,” Alhussain commented.
A 2022 report by Ryan Brukardt, a senior partner at McKinsey & Company, published by McKinsey Quarterly, found that more than 160 satellites currently monitor Earth to assess the impacts of global warming and detect activities such as illegal logging.
Brukardt cited NASA as an example of how advanced satellite tools are used to track environmental changes, including shifts in ocean conditions, cloud cover, and precipitation patterns. He also noted that satellite data can help governments determine when immediate action is needed, particularly in response to wildfires.
FASTFACT
Did You Know?
- Satellites collect massive amounts of data, and AI is used to help interpret this information more efficiently and predict future outcomes.
- The global space economy surpassed $600 billion in 2024 and is projected to exceed $1 trillion by 2030.
- Saudi Arabia has established three key entities: the Supreme Space Council, the Saudi Space Agency, and the Communications, Space, and Technology Commission.
Beyond disaster response, satellites offer vital insights for agriculture. According to Brukardt’s report, scientists can use space-based data to monitor crop development and anticipate threats to harvests, such as drought or insect infestations.
These wide-ranging applications explain the rapid growth of the global space economy.
According to World Economic Forum research, the sector is projected to reach $1.8 trillion by 2035, nearly tripling from $630 billion in 2023.
For Saudi Arabia, expanding space science capabilities could help address the country’s arid conditions by monitoring desertification and identifying sources of air pollution. Early detection of droughts, heatwaves, and crop stress could support more effective environmental planning and response.
Space-based data could also play a critical role in tracking environmental changes in the Red Sea and surrounding coastal ecosystems, strengthening marine conservation efforts and supporting the Sustainable Development Agenda.
As Alhussain emphasized, advancing knowledge in space science and satellite technology enables experts to measure environmental damage accurately and predict disasters before they occur, allowing for more effective responses.
By investing in space science education and research, the Kingdom can build national expertise, strengthen environmental protection policies, enhance food and water security, and contribute to global efforts to combat climate change—while also benefiting from the rapidly expanding space economy.
Ultimately, a deeper understanding of space and its applications offers Saudi Arabia, and the world, better tools to anticipate climate challenges, protect ecosystems, and safeguard biodiversity.
“By collecting data and using satellites, you can better analyze and measure so many things that help the environment,” said Alhussain.
“There will be patterns where you can warn people, scientists and decision makers to do something about it.”
