Japan logged a 637.61 billion yen ($4.38 billion) trade deficit in May, with auto-related shipments to the United States plunging, possibly affected by higher tariffs imposed by President Donald Trump, government data showed Wednesday.
The trade balance remained in the red for the second straight month, as overall exports fell 1.7 percent from a year earlier to 8.13 trillion yen, marking the first drop in eight months, weighed down by an 11.1 percent fall in shipments to the United States.
Imports shed 7.7 percent to 8.77 trillion yen, down for the second straight month, reflecting lower prices of crude oil from the United Arab Emirates and coal from Australia, the Finance Ministry said in a preliminary report.
By region, Japan had a 451.7 billion yen trade surplus with the United States, down 4.7 percent from the previous year, as exports dropped for the second consecutive month to 1.51 trillion yen, while imports fell 13.5 percent to 1.06 trillion yen.
U.S.-bound shipments of automobiles tumbled 24.7 percent and those of auto parts plunged 19.0 percent, both in value terms. In volume, shipments of automobiles fell 3.9 percent, showing that export unit prices declined by over 20 percent.
The Trump administration imposed a 25 percent tariff on imported vehicles in April as well as on auto parts in May, in a move set to deal a blow to Japan's mainstay auto sector, which sees the United States as a key market.
A ministry official said the latest data could have reflected moves by Japanese automakers to increase shipments of lower-priced models or cut export prices of their products in response to heavier tariffs.
"I believe the effects of the tariffs are gradually emerging, as car exports also declined in volume terms," said Takafumi Fujita, an economist at the Meiji Yasuda Research Institute.
Fujita said auto exports are likely to remain weak due to the uncertain outlook of Japan-U.S. tariff negotiations and they could negatively affect the Japanese economy, given the significant role of the industry.
With China, Japan remained in the red for the 50th consecutive month, logging a deficit of 624.87 billion yen in the reporting month, expanding 17.2 percent from the year before. Exports to the country shed 8.8 percent to 1.44 trillion yen and imports fell 2.2 percent to 2.07 trillion yen.
Japan's trade surplus with the rest of Asia, including China, ballooned more than 12-fold to 313.35 billion yen.
A deficit of 308.9 billion yen was recorded with the European Union, remaining in the red for 16th consecutive month.
© KYODO
6 Comments
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Wasabi
It is now time to ditch the USD as a reference currency and black list the US.
sakurasuki
Wait until tariffs took effect, see what will happen to export imports.
YankeeX
Too much reliance on one industry
WoodyLee
The golden age is and has been gone now for sometime, Japan did well when it's products were within reach of the average consumer Good Quality, Reasonable prices, Good customer service etc. now only the upper middle class can afford it's products then we have S. Korea with China are taking that spot.
Traveling abroad last Christmas was a shocker again seeing all these Koran and Chinese automobiles on the streets.
Agent_Neo
BYD's average monthly sales in Japan so far have only been 185 units.
They are still rarely seen on the streets.
The buying sprees by Chinese people have also disappeared, and the majority of Koreans are traveling on a budget.
They should shut out tourists from those two countries, who still come in large numbers, and attract tourists from other countries who are more likely to spend on a personal basis.
Japan's national interests cannot be protected unless it keeps relations with China and Korea to a minimum.
kibousha
We need local energy sources if we want to be profitable, but our American masters won't allow it.