Third largest economy: Germany replaces Japan

Despite growing its gross domestic product (GDP) by 1.9 percent last year, Japan was overtaken by Germany, preliminary economic data released by the Japanese government showed on Thursday. Japan’s GDP in 2023 was 4.2 trillion dollars (3.9 trillion euros), below Germany’s GDP of the equivalent of 4.5 trillion dollars.

In the fourth quarter of last year, Japan’s GDP shrank by 0.1 percent. The Asian country’s economy is particularly affected by the decline in the national currency, the yen.

Germany’s rise to the world’s third largest economy is largely symbolic. It is due less to Germany’s economic strength than to the weakness of the yen.

Rather, Germany itself is struggling with economic problems. Last year the German economy shrank by 0.3 percent. Only slight growth of well under one percent is expected this year. By far the two largest economies in the world are still the USA and China.