UPDATE 1-Japan’s unadjusted Q2 GDP less than China’s -govt

(For more stories on the Japanese economy, click [ID:nECONJP])

*China seen overtaking Japan as No.2 global economy this year

*Japan official says quarterly comparison misleading
(Adds details, comments)

TOKYO, Aug 16 (BestGrowthStock) – Japan’s second-quarter GDP was less
than China’s before seasonal adjustments, government data showed
on Monday, underscoring expectations that China will overtake
Japan as the world’s second-largest economy this year.

Japan’s second-quarter unadjusted GDP totalled $1.2883
trillion on a nominal dollar basis, against China’s
second-quarter unadjusted GDP of $1.3369 trillion, an estimate by
Japan’s Cabinet Office showed.

But Keisuke Tsumura, a parliamentary secretary at the Cabinet
Office, told reporters that it would be misleading simply to
compare quarterly growth figures for Asia’s economic powerhouses,
with a release from the Cabinet Office indicating that China does
not release seasonally adjusted figures.

“It would be correct and fair to compare the figures for the
whole year,” Tsumura said. “It will be very misleading to simply
compare quarterly figures.”

In the first six months of 2010, Japan’s GDP before seasonal
adjustments totalled $2.5871 trillion, surpassing China’s $2.5325
trillion.

“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,” he said, although he added that in the
short-term, domestic political considerations were paramount as
Prime Minister Naoto Kan struggles with a hung parliament and a
potential leadership challenge from his own party.

“It will be used as a tool in the debate in Japan, but is not
the essence of the debate itself. The debate is whether they want
a growth strategy that hurts vested interests but will help the
economy overall,” Feldman said.

China’s top currency regulator had said on July 30 that his
country had already overtaken Japan as the world’s second-biggest
economy. [ID:nTOE66T07N]

China’s nominal GDP was 34.0507 trillion yuan ($5.013
trillion) in 2009, compared with Japan’s nominal GDP of 474.303
trillion yen ($5.503 trillion), data from the two governments
showed.

China’s per capita income of about $3,800 a year is still a
fraction of Japan’s or America’s, but China’s economic ascent is
gradually translating into clout on the world stage, even as
Japan’s influence appears to fade.
($1=6.793 Yuan, 86.19 Yen)
(Reporting by Leika Kihara, Linda Sieg and Yoko Nishikawa;
Editing by Edmund Klamann)

UPDATE 1-Japan’s unadjusted Q2 GDP less than China’s -govt