Japan’s economy avoids technical recession
Japan’s economy grew 0.1 percent in the fourth quarter of 2025 compared with the previous three months, narrowly avoiding a technical recession.
While it was a reversal of the 0.7 percent contraction in the third quarter, the gross domestic product missed expectations of a 0.4 percent expansion by economists polled by Reuters.
A technical recession is commonly defined as two consecutive quarters of contraction.
On an annualized basis, output rose 0.2 percent, compared with forecasts of 1.6 percent, following a 2.3 percent decline in the previous quarter.
Compared with a year earlier, fourth-quarter GDP expanded 0.1 percent, slowing from 0.6 percent in the third quarter. Private consumption drove the modest expansion, offsetting weakness in exports and public spending, according to data from Japan’s Cabinet Office.
Following the data release, the Nikkei 225 opened up 0.12 percent, but the yen weakened 0.25 percent to 153.06 against the dollar.
The Bank of Japan in January raised its economic growth forecast for the fiscal year ending March 2026 to 0.9 percent from 0.7 percent. It also lifted its fiscal 2026 outlook to 1 percent from 0.7 percent.
The central bank said it expects moderate expansion as other countries return to growth. The BOJ also said it sees a virtuous cycle of rising prices and wages, supported by the government’s economic measures and accommodative financial conditions.
The data also comes as Japan works with the U.S., its second-largest trading partner, on a $550 billion investment pledge under its trade deal with Washington.
Public broadcaster NHK reported last Friday that Tokyo and Washington have yet to agree on the first projects tied to the pledge.
Japan Economy Minister Ryosei Akazawa was quoted as saying he hoped the initial projects would be finalized before Prime Minister Sanae Takaichi meets U.S. President Donald Trump.
Trump had announced the meeting with Takaichi just before the Feb. 8 Lower House election, which saw Takaichi lead the ruling Liberal Democratic Party to a landslide victory.
After her victory, Takaichi said last Monday that she would support economic growth by boosting investment through “proactive” fiscal policy, although she did not elaborate.
Maritime industrial corridor in Pakistan
China’s Shandong Xinxu Group has expressed strong interest in the Sea-to-Steel initiative at Port Qasim, Karachi.
The Chinese firm has agreed to submit a comprehensive unsolicited feasibility study for the proposed Integrated Maritime Industrial Complex (IMIC), read a statement on Friday.
The development came during a high-level meeting chaired by Federal Minister for Maritime Affairs Junaid Anwar Chaudhry, held to accelerate the Sea-to-Steel Initiative at Port Qasim.
The meeting centred on the IMIC, a flagship initiative to modernise industrial operations through port infrastructure upgrades, shipbuilding and recycling facilities, and an integrated steel mill.
Representatives from China’s Shandong Xinxu Group and senior Ministry of Maritime Affairs officials attended the meeting. Port Qasim Authority Chairman Rear Admiral (R) Syed Moazzam Ilyas participated via video link from Karachi.
The IMIC features three core components, including the revival and upgrading of the Iron Ore and Coal Berth (IOCB) jetty. This facility will handle ship recycling and repair, with the resulting scrap used to revive the steel mill.
Branded the “Sea-to-Steel Green Maritime Industrial Corridor,” the project connects ship recycling with domestic steel production to cut reliance on imported raw materials and leverage recyclable scrap.
The Chinese group, which has shown keen interest, will submit a comprehensive unsolicited feasibility study, including financial impact assessments, structural and hydrographic analyses, and quantitative risk evaluations, read the statement.
India’s rooftop solar push slowed by reluctant lenders
Indian Prime Minister Narendra Modi’s push to accelerate the rollout of rooftop solar power is falling short of targets despite heavy subsidies due to loan delays and limited support from state utilities, vendors and analysts say.
The shortfalls represent the latest challenge to India’s efforts to nearly double clean energy capacity to 500 gigawatts by 2030, and come as the government plans to suspend clean energy tendering targets amid a mounting backlog of awarded projects yet to be built.
Challenges to plans to increase solar uptake may mean India maintains its reliance on coal-fired power.
India’s Ministry for New and Renewable Energy created its subsidy programme for residential solar panel installations in February 2024, covering up to 40 percent of the costs.
But residential installations at 2.36 million are well below the ministry’s target of 4 million by March, according to data from the programme’s website.
“Banks’ reluctance to lend and states’ hesitance to promote the schemes could derail India’s efforts to transition away from coal,” said Shreya Jai, the lead energy analyst at research firm Climate Trends in New Delhi.
Roughly three in five rooftop solar applications filed on the scheme’s website are yet to be approved, while about 7 percent have been rejected, according to government data on the programme, known as the PM Surya Ghar.
In a statement to Reuters about the pending applications, the renewable energy ministry pointed to accelerating installations, which have benefited over 3 million households, and said the scheme enables state-owned utilities to reduce subsidy payouts to keep residential power bills in check.
Economists urge Bangladesh’s next government
After assuming office, the new government should focus immediately on taming red-hot prices, restoring law and order, and creating a favourable environment for investment to generate new jobs, say economists.
They came up with the call as BNP prepares to form the new administration this week after a landslide victory in the February 12 national election.
Experts say the incoming government will inherit an economy that, despite showing signs of recovery, struggles with stubbornly high inflation, slowing private investment, a vulnerable financial sector, and declining exports.
The economy grew only 3.97 percent in fiscal year 2024-25, the lowest in five years, and subdued growth is expected to continue in 2026.
Economists highlighted supply-side constraints as a major driver of the rising cost of living. The tight monetary policy maintained by the Bangladesh Bank has so far failed to curb inflation.
They recommended keeping import tariffs low on essential goods, ensuring sufficient supply, and strengthening market monitoring. Monetary policy alone, such as maintaining high interest rates, will not be enough to rein in prices.
“Inflation is impacting all amid the erosion of their real wages.
So, the new government should pay attention to this problem,” said Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD).
Overall inflation rose to 8.58 percent in January, with the 12-month average at 8.66 percent, remaining elevated for more than three years, according to the Bangladesh Bureau of Statistics (BBS).
Private-sector businesses are also feeling the pinch as rising costs undermine profitability.
Fahmida called for coordinated monetary and fiscal policies, prioritising supply-side issues. Another key task, she said, for the next government is to improve the investment climate.
The economist said that while reforming the business environment is a long-term process, measures such as establishing effective one-stop services for entrepreneurs and reducing bureaucratic red tape could deliver results quickly.
Malaysia’s economy grows 6.3pc yr/yr in q4
Malaysia’s economy grew 6.3 percent in the fourth quarter of 2025 from a year earlier, its fastest pace in three years and surpassing expectations, government and central bank data showed on Friday.
Economists surveyed by Reuters and advance estimates released by the government had forecast annual gross domestic product growth would come in at 5.7 percent in the October to December period.
Growth was revised upwards to 5.4 percent from 5.2 percent in the third quarter.
Full-year 2025 economic growth was 5.2 percent, a notch above the 5.1 percent expansion the previous year and exceeding official projections of between 4 percent and 4.8 percent, the data showed.
Growth in 2025 was driven by strong domestic demand and exports, assisted by strong investment growth, the central bank said in a statement.
“This growth momentum is expected to continue in 2026, supported by resilient domestic demand and exports,” Bank Negara Malaysia Governor Abdul Rasheed Ghaffour said.
The government and central bank expect the economy to grow between 4 percent and 4.5 percent this year, amid persisting uncertainties about the impact of US tariffs.
Malaysia faces a 19 percent levy on goods exported to the United States.
The central bank kept its key interest rate unchanged at 2.75 percent during its first policy review of 2026 last month, citing steady economic growth, modest inflation, and a positive outlook for the year.
Bank Negara Malaysia last lowered its main policy rate in July 2025, in a preemptive move after US President Donald Trump imposed steep tariffs on most trading partners.
Philippine economy slow sharply at the end of 2025
The Philippine economy slowed sharply at the end of 2025, prompting renewed concern that growth driven largely by services is no longer sufficient to sustain long-term development. Business groups say the latest figures highlight a deeper structural issue: the continued weakness of manufacturing and industrial production.
Data from the Philippine Statistics Authority show gross domestic product expanded 3.0 percent in the fourth quarter of 2025, the weakest quarterly growth in several years outside the pandemic period. For the full year, economic growth reached 4.4 percent, missing the government’s target for the third consecutive year.
Economists attributed the slowdown to softer household spending, reduced government expenditure, and weaker investment activity. Industry leaders, however, say the data also reflect long-standing imbalances in the economy, with services continuing to dominate while productive sectors lag.
Services such as retail, tourism, real estate, and business process outsourcing remain the largest contributors to economic output. While these sectors provide employment and relatively stable income growth, economists note that they generate limited productivity gains and do little to expand export capacity.
Manufacturing and other industrial activities have struggled to gain traction. Government figures show industry growth trailing services, limiting higher-value job creation and increasing reliance on imported goods. Business groups warn that as neighboring Southeast Asian economies expand industrial capacity, the Philippines risks losing competitiveness in attracting investment and integrating into global supply chains.
The Federation of Philippine Industries has urged policymakers to place industrial development back at the center of economic strategy. The group has said services alone cannot support sustained growth and that manufacturing is essential for job creation, exports, and economic resilience.
While the government has enacted policies such as the Tatak Pinoy Act to support local industries, business groups say implementation has been uneven. Multilateral lenders, including the Asian Development Bank, project moderate growth in 2026 but warn that long-term performance will depend on structural reforms rather than short-term stimulus.