Japanese exports plunged a record 26.7 percent last year, the Japanese Ministry of Finance said yesterday, highlighting the drop in global consumer demand for automobiles, electronics parts and other Japanese products.
Economists warned that exports — a mainstay of the world’s second-largest economy — would tumble further with no recovery in sight for the global economy. Even exports to the rest of Asia are falling sharply.
“Demand is rapidly cooling not only in the United States and Europe but also in Russia and the Middle East, and we are expecting a further plunge in exports as the global economy is deteriorating,” said Hideki Matsumura, a senior economist at the Japan Research Institute in Tokyo.
Battered by falling sales and a strengthening yen, major exporters like Toyota Motor Corp and Sony Corp have already announced job cuts and lower profit projections.
Exports suffered their biggest year-on-year drop since the current system of statistics went into effect in 1980. Exports totaled ¥5.3 trillion (US$60 billion) while imports fell 14.4 percent from a year earlier to ¥5.55 trillion, the ministry said.
That resulted in a trade deficit of ¥223.4 billion — the fourth time this year Japan said its imports exceeded exports after January, August and October.
For years, Japan was blasted by its trading partners over its trade surpluses. But now, the global economic slump is turning Japan into a net importer, at least in recent months.
“The plunge in exports in November clearly reflected a severe global downturn. Demand for Japanese goods, especially cars and electronics products, is falling sharply everywhere,” ministry official Yu Oki said.
Exports to the US, the world’s largest economy, plummeted by a record 33.8 percent last month, marking the 15th consecutive year-on-year fall.
Among US-bound shipments, vehicle exports plummeted by 44 percent in the month, while exports of auto parts fell 40 percent and those of audio equipment were down by 48.2 percent.
Japan’s exports to the EU tumbled by 30.8 percent, with vehicle shipments to the region falling by 37.2 percent, the ministry said.
Asia-bound exports fell 26.7 percent as semiconductor shipments dropped by 30.2 percent. Japan’s exports to China alone plunged by 24.5 percent.
Exports are also shrinking as the yen appreciates against most major currencies. That means overseas sales in dollars and euros translates into fewer yen.
The ministry said the yen traded at 97.97 to the dollar on average last month, up 16 percent from the same month last year.
The yen continued to climb against the dollar this month, hitting a 13-year high as investors dumped the greenback on US economic worries. The Japanese currency was quoted at 90.02 to the dollar in Tokyo yesterday afternoon.