Japan’s trade surplus grew last month for the first time in 20 months as an export slump eased, data showed yesterday, supporting hopes the world’s No. 2 economy is crawling toward a recovery.
The surplus jumped roughly five-fold to ¥508 billion (US$5.4 billion), from ¥104.1 billion a year earlier, the finance ministry reported.
Exports exceeded imports for a fifth straight month, giving a vital boost to a country whose heavy dependence on overseas demand left it highly exposed to the global economic downturn.
The year-on-year improvement in the trade balance, the first since October 2007, reflected a smaller decline in exports and a sharp fall in imports.
Exports sank 35.7 percent from a year earlier to ¥4.6 trillion, after a 40.9 percent plunge in May, while imports dived 41.9 percent to ¥4.1 trillion.
“Exports are improving. What had been most worrying were shipments to the United States, but they shrank less than before,” Daiwa Institute of Research economist Hiroshi Watanabe said.
US-bound exports were down 37.6 percent from a year earlier, compared with drops of more than 40 percent in April-May and more than 50 percent in January-March.
Watanabe said a credit crunch that had squeezed demand for cars and other products was now easing, supporting overseas demand for Japanese goods.
Exports should keep improving through this year, but companies still need to shed excess jobs and manufacturing facilities, he added.
Japan posted a trade surplus of ¥3.9 billion with China, the first black ink in four months, while the surplus with the EU dived 71.6 percent to ¥90.5 billion for a 10th consecutive decline.
Government stimulus spending efforts are gradually helping to boost demand for Japanese goods, but the recovery is patchy, said Hideyuki Araki, an economist at Resona Research Institute.
“It is mostly large companies that are benefiting from other countries’ economic packages and smaller firms are still struggling. Overall production activity is recovering but lacks strength,” he said.
For the six months to last month, Japan posted a trade surplus of ¥8.3 billion, down 99.7 percent from a year earlier but marking a turnaround from a deficit of ¥766.3 billion in the second half of last year.