Japan's population dropped for the second straight year in the 12 months to March despite a slight rebound in the country's low birth rate, according to the government.

The government report said births went up for the first time in eight years but that it was offset by the number of Japanese who moved overseas.

The Japanese population in the fiscal year to March dropped to 127,053,471, down 1,554 from the previous year, according to the Ministry of Internal Affairs and Communications.

In the year to March 2006, Japan's population shrank for the first time on record in peacetime as more young people decided that starting families would be a burden on their careers or lifestyles.

But the number of births in the year to March 2007 increased for the first time in eight years to 1,091,917, up 26,384 from the previous year, the ministry said.

It was a turnaround from a record decline of 1,065,533 a year earlier, boosting government theories that a growing economy is encouraging people to have more children.

The overall decline in the population was due to a decrease of 12,297 in the number of registered residents mainly due to the outflow of people overseas, the ministry said.

The natural increase of population, or births minus deaths, came to 10,743 reversing a natural drop of 6,748 a year earlier.

The population of people aged 65 or older came to 26,675,163, a record 21per cent of the total population, compared with the previous year's 20.3 per cent.

In an annual report on ageing, the government forecast in June that two in every five people will be 65 or older by 2055 if the trends of a low birthrate and high life-expectancy continue.

Source: Agence France-Presse reported in Push Journal 03/Aug/07