Why is anime limited in animation? Like when you watch a character talk in anime you'll notice he/she is not lip syncing the words he/she pronounces: their mouths move up and down and appear to be looping. This limited animation technique is 'looping' from talking, running, walking, etc. So why is it Japanese animation is limited?
Please see the latter part of the answer to Is intentionally producing a lower quality TV release unique to anime?:


  American cartoon viewers are very particular about the quality. My friend who is a key-frames animator for The Simpsons told me that there is one animator whose entire job is just to animate the mouth movements, because if the mouth movement does not perfectly match the voice actor's words, the fans generally feel that they cannot suspend disbelief. In contrast, anime in Japanese does not always bother to record the voice actors' voices first before animating, since Japanese fans do not care much whether the mouth movements exactly match. . . . American viewers are used to watching mouth movements like in The Simpsons and Disney films which are perfectly aligned. 


This is not a case of anime being "limited" in a negative sense of slacking off, cutting corners, or being too rushed, but rather, Japanese viewers are not at all bothered by mouth movements which do not perfectly align with the voice, and therefore do not expect that out of animation production companies. It is a cultural difference, so it does not make sense to label the Western style as "better at" animating.

Anime can precisely match mouth movements to the voice when it is desired to do so (see the opening theme song sequences of Ao Haru Ride and Ore Monogatari!! for examples), so the companies have the required skill to do it. It is just a matter of preference that they often do not.

Because Japanese viewers are not particular on this point, it allows the production company to begin animating the cels before the seiyuu (voice actors) finish recording their lines. This gives the anime industry more flexibility in the timeline of production, as compared to non-Japanese animation which requires the script to be finalized and the voice acting to be recorded before the mouth movement animation can begin (in other words, multiple aspects of the production of an anime episode can occur at the same time). A benefit of this flexibility is that seiyuu have the freedom to ad-lib lines in the studio on the spot if they come up with something they think might work better than what is written in the script that was handed to them; even if the mouth movements have already been animated to basically match the line in the script, improvisation is still possible. Some fans enjoy buying anime scripts and comparing the original script to the final product, so they can discover which parts the seiyuu contributed.

Historically, anime was drawn by hand, so looping, panning, overlaying cels, etc. were more utilized in older titles (since animating a whole episode's worth of cels took a lot of man hours) than in current anime, which is predominantly computer-animated. If you watch older series such as Ashita no Joe or Ace wo Nerae!, you can see very impressive and creative alternatives to animating many frames per second, an art form which has largely diminished with the advent of computers. There is a remarkable and arresting charm to some of the classic animating techniques which were developed in order to stylistically or realistically convey the scene or the character's emotion in less frames. The looping mouth movement is one of these early innovations.