Japan economy logs best growth in three years

Pedestrians holding umbrellas walk past an electronic board outside a brokerage in Tokyo on Feb 4, 2014. -- FILE PHOTO: REUTERS
Pedestrians holding umbrellas walk past an electronic board outside a brokerage in Tokyo on Feb 4, 2014. -- FILE PHOTO: REUTERS

TOKYO (AFP) - Japan's economy put in its best performance in three years during 2013, expanding by 1.6 per cent as Prime Minister Shinzo Abe's growth blitz rippled through the world's number-three economy.

But the annual figure was only modestly ahead of the expansion in 2012 and weaker-than-expected fourth quarter data was likely to stoke more concerns about keeping up the pace of growth as Japanese consumers get set for an April sales tax rise.

Fears that the rate increase will derail Abe's growth drive, dubbed Abenomics, has stoked speculation that the Bank of Japan (BoJ) would be forced later this year to expand its already unprecedented monetary easing drive to counter a slowdown.

The programmed launched by the BoJ, which kicks off a two-day meeting on Monday, is a cornerstone of the premier's bid to restore Japan's fading status as an economic superpower.

The figures published Monday showed that, after leading G7 nations in the first half of the year, Japan's economy expanded just 0.3 per cent in the October-December quarter, less than the 0.7 per cent expansion that economists had expected, according to a survey by the leading Nikkei business daily.

Japan's economy grew 1.4 per cent in 2012 and contracted 0.5 per cent in 2011 as the country was hammered by a quake-tsunami disaster and subsequent nuclear crisis.