Japan biz feels jitters of trade war

tokyo — Japan’s exports to the US fell for the first time in 17 months and Japanese business sentiment soured amid worries about President Donald Trump’s protectionist trade policies.

Exports to the United States dipped 0.9 per cent in June from the same period a year ago on waning shipments of cars and semiconductor manufacturing equipment, two of Japan’s most important export products.

Thursday’s trade data came on the heels of the Reuters Tankan, which showed business sentiment slipped in July, reflecting companies’ fears about an intensifying trade dispute between the United States and China.

The batch of data highlighted concerns among Japanese policymakers who worry Trump may resort to tariffs or other protectionist measures to fix trade imbalances with Japan under his “America first” policy.

The government cut its view of business sentiment and warned that it must be “vigilant” about the impact that Sino-US trade frictions could have on the global economy, which would in turn affect export-reliant Japan.

“Overall exports remain healthy for now, but we are not sure how things are going to turn out on the trade policy front,” said Shuji Tonouchi, senior market economist at Mitsubishi UFJ Morgan Stanley Securities. “It’s possible talk of tariffs and trade friction could reduce corporate investment.”

With Japanese imports from America down 2.1 per cent, Japan’s trade surplus with the United States widened 0.5 per cent year-on-year to ¥590.3 billion ($5.24 billion). —