Japan posts record string of 15 monthly trade deficits


Tue, Oct 22, 2013 - Page 15

Japan posted a record 15th consecutive monthly trade deficit last month, as data yesterday showed the country’s energy bill soaring, but exports to China rebounded after a territorial row last year hurt demand for Japanese goods.

While the yen’s sharp decline is generally seen as a plus for Japan’s export picture, the overall volume of shipments declined last month as an uncertain US economic recovery held back growth.

Sky-high energy bills from imports of pricey fossil fuels — made more expensive by the weak currency — also weighed on the nation’s trade balance.

Energy imports surged after the 2011 Fukushima Dai-ichi crisis forced the shutdown of Japan’s nuclear reactors, which once supplied a third of the nation’s power.

There is little public appetite to turn the reactors back on, although Japan’s conservative government has said a restart was all but certain once safety is assured.

“Japan will continue to rely on energy imports, and any boost to exports from the weaker yen won’t be enough to turn around the trade deficit,” RBS Securities chief economist Junko Nishioka said.

The Japanese Ministry of Finance yesterday said that Japan recorded a deficit of ¥932.1 billion (US$9.5 billion), 64.1 percent higher than the ¥568.2 billion deficit a year earlier. It also marked the 15th straight month of deficit, the longest spell since comparable data started in 1979.

The value of exports rose 11.5 percent to ¥5.97 trillion, helped by shipments to China — Japan’s largest trading partner — which rose 11.4 percent from a year earlier.

“Exports to China are on a gradual recovery path,” Daiwa Institute of Research economist Masahiko Hashimoto told reporters.

Shipments to the key US market were up 18.8 percent on year, but analysts said growth appeared to be stalling, after a two-week government shutdown threatened to send the US into a debt default.

“US consumer sentiment isn’t great because of the government shutdown,” SMBC Nikko Securities chief economist Junichi Makino told reporters.

Demand for Japanese goods from emerging Asian economies, which then sell to the US, was also lackluster, Makino said.

“Exports to Asian emerging economies such as South Korea, Taiwan, Singapore, India and Thailand won’t recover unless the US economy improves further,” he added.

Overall, imports jumped 16.5 percent to ¥6.9 trillion owing to the higher energy costs and rising demand for some electronic equipment and smartphones such as Apple’s iPhone.

Tokyo stocks closed 0.91 percent higher yesterday, buoyed by a stronger US dollar and relief after last week’s debt deal in Washington, while investors largely shrugged off the latest trade data.

The benchmark Nikkei 225 index added 132.03 points to 14,693.57, and the Topix index of first-section shares rose 0.57 percent, or 6.84 points, to 1,212.36.