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MYTH, Japan: Japan’s trade surplus widened in August as the pandemic hit a wide range of industries and undermined consumer demand.
The 15 percent drop in exports from the previous year was outweighed by a more than 20 percent decline in imports, according to preliminary data from the Finance Ministry released on Wednesday.
In a rare upside, exports to China were up 5 percent. But both exports and imports with the United States fell more than 20 percent, helping to reduce the politically sensitive trade surplus by 20 percent to 373 billion yen, or $ 3.5 billion.
Many Japanese manufacturers provide chemicals, equipment, and components for products assembled in China. Strong exports have helped fuel growth in recent years, but suffered due to the slowdown in China’s economy and the pandemic.
The pace of declining exports has been slowing as pandemic-related closures in China, the United States and Europe moderated. Exports fell 28 percent in May, 26 percent in June and 19 percent in July.
Exports in August totaled 5.23 trillion yen ($ 49 billion), surpassing the 4.98 trillion yen in imports ($ 47 billion), leaving a surplus of 248 billion yen ($ 2.4 billion). millions). That compares with a deficit of 152.2 billion yen the previous year.
Trade in most product categories declined in August, and exports of transportation equipment, such as vehicles, fell 23 percent. However, exports of computers and phones increased, reflecting strong demand as many businesses and schools adjust to remote work.
Weak exports to Southeast Asia took its toll, dropping nearly 24 percent as trade and travel have languished amid tight quarantine restrictions.
To boost the trade surplus, imports of oil, gas and other fuels plunged 45 percent, partly thanks to lower prices for many commodities. Overall, imports have been falling for 16 consecutive months, partly due to lower prices for oil and other goods, resources Japan must source from abroad.
Despite the latest weak data, manufacturer surveys show that new export orders are on the rise, said Tom Learmouth of Capital Economics.
“But although exports of goods will continue to rebound as activity picks up in Japan’s trading partners, exports of goods and services may not reach pre-virus levels until early 2022,” it said in a report. AP
