TOKYO (AP) — Japan logged a deficit for a second straight year last year as its exports were hurt by a slowdown of demand in China amid a tariff war with the United States (US).
Government data released yesterday showed Japan’s exports fell 5.6 per cent in 2019, to JPY76.9 trillion (USD701.6 billion), while imports fell 5.0 per cent to JPY78.6 trillion (USD710 billion). That left a deficit of JPY1.6 trillion (USD14 billion).
Japan had a trade surplus of JPY6.6 trillion (USD60 billion) with the US last year, as exports fell 1.4 per cent from 2018, and imports fell 4.4 per cent. Shipments of computers, construction and textiles equipment and power generating machines contributed to a 3.7 per cent increase in exports of machinery to the US Vehicle exports, which account for nearly 40 per cent of Japanese exports to the US, declined 5.5 per cent, the data show.
Exports and most imports from around the world also declined amid a global slowdown. Exports to China dropped nearly eight per cent, matching the drop in exports to all of the rest of Asia.
Last December, exports continued to fall, but at a slower pace than the month before, dropping 6.3 per cent, while imports slipped nearly five per cent.
“Looking ahead, we think the recovery in exports will be weaker than many expect. That reflects our view that GDP growth in Japan’s main trading partners will remain subdued this year,” Tom Learmouth of Capital Economics said in a report.
He noted that an increase in Japan’s sales tax, to 10 per cent from eight per cent, as of October 1 last year has also hurt consumer demand and private investment.
Japan’s exports of cars and other vehicles, which constitute nearly a quarter of all its exports, fell four per cent, while exports of electrical machinery dropped 6.6 per cent . Its imports of gas, oil and other fuels fell 12 per cent as prices declined from a year earlier.
US President Donald Trump has thrown out past trade deals, including that with China, that he said added to the US trade deficit and cost the country manufacturing jobs.