China's economy again beat Japan's in the third quarter, and Asia's rising giant remained on course to unseat Japan as the world's number two economy for the year as a whole, data showed Thursday.
Japan stressed that it remained ahead for the first nine months, thanks to strong growth in the first quarter. But since then it has been outperformed by China, a trend that is expected to continue.
For July-September, China's nominal gross domestic product of 1.415 trillion dollars beat Japan's 1.369 trillion, the cabinet office in Tokyo said, quoting average Japan interbank exchange rates and an IMF yuan-dollar rate.
A Chinese flag is displayed in Shanghai.
China eclipsed Japan in the second quarter, as the archipelago nation was hit by cooling exports and flat domestic consumption in April-June.
However, Japan's nominal GDP for January-September was 3.959 trillion dollars while China's was 3.946 trillion dollars, the official said.
Beijing has been criticised for keeping the yuan artificially low, suggesting that China's nominal GDP should be even higher, while the recent strength of the yen versus the dollar has pushed up Japan's nominal figure.
Japan's on Thursday revised its July-September growth higher to an annualised 4.5 percent from an initial estimate of 3.9 percent.
But China's trajectory in surpassing Japan as the world's second-biggest economy this year will be likely strengthened by an expected Japanese slowdown in the fourth quarter as export growth cools.
Japan's post-war "economic miracle" put it at number two behind the United States for more than 40 years, but stagnation after its property bubble burst in the 1990s has helped put China on course to supplant it this year.
Japan remains more than 10 times richer on a per-capita basis, according to the International Monetary Fund.
While China's leap forward reflects a shift in economic power as the country continues its transformation from poverty-hit communist state to global heavyweight, it also highlights the need for Japan to re-energise its economy, say analysts.
Despite it crawling out of a severe year-long recession in 2009, Japan's recovery remains fragile with deflation, high public debt, weak domestic demand, softening exports and a strong yen all concerns for policymakers.