Japan logs trade deficit of 1.15 tril. yen in Jan., 1st in 3 months
TOKYO (Kyodo) -- Japan logged a trade deficit of 1.15 trillion yen ($7.5 billion) in January, its first red ink in three months, government data showed Wednesday, amid a slow recovery in U.S.-bound exports due to tariffs imposed on auto and other products.
The deficit, however, shrank 58.0 percent from a year earlier as overall exports rose 16.8 percent year-on-year to 9.19 trillion yen, up for the fifth straight month, on solid demand for semiconductors and other electronic parts in the rest of Asia, including China, the Finance Ministry said in a preliminary report.
Imports decreased 2.5 percent to 10.34 trillion yen on lower shipments of liquefied natural gas from Malaysia and crude oil from the Middle East, the ministry said.
Japan's exports to the United States fell 5.0 percent to 1.46 trillion yen, dropping for the second straight month, as shipments of motor vehicles declined 9.9 percent in value terms and demand for Japanese pharmaceuticals was sluggish.
While import duties imposed on Japanese cars were lowered to 15 percent from 27.5 percent in September under a trade deal struck by Tokyo and Washington, they remained six times higher than the 2.5 percent tariff in place prior to U.S. President Donald Trump's return to the White House.
A trade surplus of 367 billion yen was recorded with the United States, down 23.0 percent from the previous year as imports rose 3.0 percent to 1.10 trillion yen.
The Trump administration's tariff measures, aimed in part at reducing chronic U.S. trade deficits, will continue to weigh on global economic growth through as trade volumes drop, said Takeshi Minami, chief economist at the Norinchukin Research Institute.
In such a situation, "It is not expected that exports will be a driving force for the Japanese economy for a while," Minami said.
Japanese auto shipments to the United States have been recovering since sharp falls in April and May, but automakers have not passed on the tariff costs to vehicle prices, dealing a blow to their net incomes, he said.
Japan remained in the red with China for the 58th straight month, logging a deficit of 1.08 trillion yen in January.
Exports to the world's second largest economy jumped 32.0 percent to 1.55 trillion yen while imports edged up 0.6 percent to 2.63 trillion yen, hitting a record high.
A ministry official said the government "will closely monitor the impact" of China's tighter controls on dual-use item exports to Japan covering seven types of critical minerals as well as rare metals and electronic devices, imposed in early January amid a diplomatic feud.
Trade with Asian nations, including China, resulted in a deficit of 102.8 billion yen, falling into negative territory for the first time in 12 months, the report said.
A 202.4 billion yen trade deficit was registered with the European Union, marking the 24th consecutive month of red ink, as auto exports to the bloc surged while imports of aircraft parts dived, according to the ministry.
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