Japan posts record 15th straight monthly trade gap on energy bill
Print Edition
Japan posted a record 15th consecutive monthly trade deficit in September, 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 turned down 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 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,” said RBS Securities chief economist Junko Nishioka.
The finance ministry said Japan recorded a deficit of 932.1 billion yen (US$9.5 billion), 64.1 percent higher than a 568.2 billion yen 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 yen, helped by shipments to China — Japan’s largest trading partner — which rose 11.4 percent from a year earlier.
The improving figures come after a territorial dispute over a set of islands in the East China Sea set off protests in China and a consumer boycott of Japan-branded goods.
The unrest last year forced Japanese businesses to temporarily shutter operations in China, while the Asian neighbors’ trading relationship took a huge hit.
“Exports to China are on a gradual recovery path,” Masahiko Hashimoto, economist at Daiwa Institute of Research, said.
Shipments to the key US market rose 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,” Junichi Makino, chief economist at SMBC Nikko Securities, told Dow Jones Newswires.
Demand for Japanese goods from emerging Asian economies, which then sell to the US, was also lacklustre, 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 rose 16.5 percent to 6.90 trillion yen owing to the higher energy costs and rising demand for some electronic equipment and smartphones such as Apple’s iPhone.
Japan’s mixed trade picture is due to the weak yen, which boosts the costs of imports but also inflates the value of exports.
The yen has shed by about a quarter against the dollar in the past year.
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