Ja­pan an­nounces first half-year trade sur­plus since Fukushima dis­as­ter

The Myanmar Times - - International Business -

JA­PAN posted its first half-year trade sur­plus yes­ter­day since the 2011 Fukushima nu­clear dis­as­ter, af­ter the ac­ci­dent sent en­ergy im­port bills soar­ing and led to a string of deficits.

The world’s third-largest econ­omy logged a sur­plus of 1.8 tril­lion yen (US$17 bil­lion) in the Jan­uaryto-June pe­riod, against a 1.69 tril­lion yen deficit in the same pe­riod last year, the fi­nance min­istry said.

A sharp drop in oil and gas prices took pres­sure off Ja­pan’s trade bal­ance, but ex­ports still strug­gled to make head­way with a sharp rise in the yen weigh­ing on prof­its among some of Ja­pan’s big­gest firms.

The six-month sur­plus was the first since the July-to-De­cem­ber 2010 pe­riod, trade min­istry data showed.

The Ja­panese econ­omy, which was al­ready strug­gling at that time, was ham­mered by the quake-tsunami dis­as­ter that sparked the ac­ci­dent at Fukushima.

The atomic dis­as­ter, the worst since Ch­er­nobyl in 1986, forced the shut­down of re­ac­tors in re­sour­ce­poor Ja­pan, which turned to ther­mal power plants and pricey fos­sil fuel im­ports to keep the lights on.

Fall­ing en­ergy prices have been good news for Ja­pan’s trade bal­ance but its ex­port picture re­mains shaky with the value of ship­ments to key mar­kets China and the United States both down.

China-bound ship­ments dropped 10.0 per­cent in June, mark­ing a fourth straight monthly de­cline, while they were down 6.5pc to the US, led by a fall in auto and steel ex­ports.

Ship­ments to China and the US also fell over the six-month pe­riod.

“The sharp strength­en­ing of the ex­change rate since the start of the year con­tin­ued to de­press trade val­ues in June,” said Mar­cel Thieliant from re­search house Cap­i­tal Eco­nom­ics.

But the vol­ume of trade has sta­bilised and the yen’s surge was cool­ing off, he added.

“As such, im­port prices should pick up again, re­sult­ing in a re­newed de­cline in the trade sur­plus,” he said.

The yen, of­ten seen as a safe haven cur­rency, surged on fears over the state of the global econ­omy and more re­cently on con­cerns over Bri­tain’s vote last month to quit from the Euro­pean Union.

Ja­pan’s econ­omy has been strug­gling to gain trac­tion with a string of weak read­ings and sag­ging busi­ness con­fi­dence heap­ing pres­sure on Tokyo and the Bank of Ja­pan to counter the down­turn.

‘The sharp strength­en­ing of the ex­change rate since the start of the year con­tin­ued to de­press trade val­ues in June.’

Mar­cel Thieliant Cap­i­tal Eco­nom­ics

The cen­tral bank this week holds its lat­est meet­ing where it is ex­pected to an­nounce fresh mon­e­tary eas­ing mea­sures, as Tokyo com­piles a promised stim­u­lus pack­age re­port­edly worth as much as 20 tril­lion yen.

The BoJ’s mas­sive mon­e­tary eas­ing plan is a corner­stone of ef­forts to bring an end to years of the de­fla­tion that held back growth in the once-pow­er­house econ­omy.

But Prime Min­is­ter Shinzo Abe’s growth poli­cies, dubbed Abe­nomics, have fal­tered.

The plan – a mix of mas­sive mon­e­tary eas­ing, govern­ment spend­ing and red-tape slash­ing – brought the yen down from record highs and made Ja­pan’s ex­ports more com­pet­i­tive but that has not been enough to de­liver con­sis­tent eco­nomic growth. –

Photo: AFP

A con­tainer freighter an­chors at a pier in Tokyo on July 25.

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