Japan has lost its place as the second biggest world economy, after sluggish growth figures saw it slip behind Asian neighbour China.

Exports of cars, gadgets and electrical components have slowed in recent months while Japanese consumers were cautious in their spending.
The latest government data showed Japan’s GDP growth slowed to 0.4% in the three months to June compared with the previous two quarters - a level much lower than expected.
Over the year as whole, Japan’s economy is forecast to expand by 2-3%, while China’s is growing at around 10% every year.
The gap between the size of the two economies at the end of last year was already narrow, and the latest statistics put China out in front.
The difference in growth rates means China will almost certainly also come out on top by the end of 2010.
With a rapidly growing population and booming industry, some experts predict China will overtake the US as the world’s largest economy as early as 2030.
“People have been expecting the Chinese economy to grow at a rapid pace and become physically larger than Japan for many years, so it is not a surprise,” said Robert Feldman, chief economist at Morgan Stanley MUFG Securities in Tokyo.
“The issue is whether this will be a trigger for policy changes in Japan.”
Japan has held the number two spot after the US since 1968, when it overtook West Germany.
It rose to become a global manufacturing and financial powerhouse but its so-called economic miracle turned into a massive house price bubble in the 1980s before imploding in 1991.
Meanwhile in the last few years China’s economy has pushed aside Britain, France and Germany as it heads towards unseating the US.
Just five years ago China’s GDP was half of Japan’s.
However, its rapid expansion has not been felt by much of Chinese society.
While there are dozens of billionaires, the average income for the rest of its 1.3 billion people is among the world’s lowest.
China has a per capita income of just £2,300 compared to a per capita income of £24,250 in Japan.
Americans remain the richest in the world with a per capita of over £27,000, and their economy is a whole is still by far the biggest.
(Source:news.sky.com)
CAPTION: A woman walks in front of a boutique advertising a sale in Tokyo. Japan's economy grew at a much weaker than expected pace and was overshadowed by China in the second quarter of 2010.