LONDON, Nov 28: The global financial crisis took a fresh toll on economies from Asia to Europe on Friday, with Japan and India suffering setbacks and Sweden the latest European nation to fall into recession.

Japan slipped deeper into recession with factory output tumbling 3.1 per cent and consumer spending dropping 3.8 per cent in October, official data showed.

The figures were “stunningly bad,” said Societe Generale’s chief Asia economist, Glenn Maguire.

“Japan’s industrial activity is set to worsen in the near-term, perhaps by an unprecedented degree, as exports to the US have plunged over the past year,” he warned.

Rising economic powerhouse India, struggling with extremist attacks in the financial capital Mumbai, said its economic growth slowed to 7.6 per cent in the third quarter of 2008 from 7.9 per cent in the second.

While still a respectable performance at a time when many developed economies are in recession, the slowdown in India highlighted the extent to which the US-born financial crisis has spread around the world.

The Russian central bank raised its key refinancing interest rate again to 13 per cent from 12 per cent on Friday to “lower the level of capital outflows and contain inflationary tendencies.”

The global economic crisis has prompted investors to pull their cash out of developing economies like Russia that are still seen harbouring risk and to transfer it to more established havens.

There was also bad news from South Korea, where industrial production fell 2.3 per cent in October in a sign that the export-driven economy was slowing faster than expected.

While some analysts believe stocks are now looking cheap, others see little prospect of a recovery in the current climate of fear and gloom over the global economy.

Sweden fell into recession in the third quarter after its economy contracted 0.1 per cent for two successive quarters, the national statistics agency (SCB) said on Friday.

Sweden joins Ireland, Italy and Germany as European Union members now in recession.

In Hungary, Japanese car manufacturer Suzuki said it would lay off 1,200 people at a plant near Budapest.

Taiwanese electronics company Foxconn said it would lay off 1,500 workers at two Hungarian plants, the MTI news agency said.

Italy’s government said it had adopted measures including tax credits to help families and companies cope with the country’s recession, with one news report valuing the aid at 4.0 billion euros.

In Spain, the collapse of the once-booming property sector, which has dragged Europe’s fifth-largest economy to the brink of recession, continued.

Major developer Habitat filed for creditor protection and its rival Colonial said it was at risk of doing the same.

With developed nations focused on efforts to boost their own recession-ridden economies, the World Bank urged donors not to abandon poor countries hit by the financial crisis.

Developing countries “find themselves at the mercy of a crisis not of their making,” World Bank President Robert Zoellick said ahead of a UN development conference this weekend.—AFP