Japan exports fall for fifth straight month
Japan’s exports fell for the fifth straight month in July as the country contends with a strong yen and the ongoing impact of the March earthquake and tsunami.
Exports fell 3.3% from a year earlier to 5.78-trillion yen ($75.6-billion), the finance ministry said on Thursday.
Exports are a key driver of the world’s number three economy, and the country is hoping that overseas demand will help it bounce back from the March 11 disaster. Data earlier this week showed that Japan’s economy shrank for the third straight quarter in the April to June period.
The earthquake and tsunami damaged or destroyed factories in north-east Japan, which led to serious parts shortages for manufacturers in the auto and electronics industries.
While the country has made progress in restoring production, it now faces new threats. A surging yen—which has recently tested record highs against the dollar—is painful for Japan’s exporters. It reduces the value of their foreign earnings and makes Japanese goods more expensive in overseas markets.
Japan intervened in currency markets earlier this month to try to reverse the yen’s climb. The decision to sell the yen and buy the dollar worked initially, sending the greenback toward 80 yen. But the dollar has been weighed by the dimming outlook for US economy and is back down to mid 76-yen levels.
Shipments to the US fell 8.2% in July, while those to China were down 1%. Exports to the European Union rose 6%.
Motor vehicle exports to the world fell 3.8% in value terms, and electrical machinery shipments declined 8.3%.
The finance ministry said imports in July rose 9.9% to 5.7-trillion yen, resulting in a trade surplus of 72.5-billion yen.—Sapa-AP