THE ASSOCIATED PRESS
November 20, 2019 at 14:10 JST
Subaru cars for export are parked at Kawasaki port, near Tokyo, on July 8. (AP file photo)
Japan’s exports fell 9.2 percent in October from the year before, the biggest drop in three years as the U.S.-China trade war and tensions with South Korea bit into demand.
The tariff war between the United States and China has taken a toll across Asia, hurting manufacturers and supply chains.
Imports slumped nearly 15 percent, resulting in the country’s first surplus in four months, according to customs data released Wednesday.
The weaker trade data reflect lower oil prices but also mounting pressure on the economy from a mainstay of growth at a time when consumers are adjusting to an Oct. 1 sales tax hike.
Exports to the United States dipped 11 percent from a year earlier in the third straight month of declines, with weaker shipments of cars, auto parts and machinery. Imports from the United States fell 17 percent year-on-year, the Finance Ministry said Wednesday.
Shipments to China, Japan’s biggest export market, dropped 10 percent.
Two-way trade with South Korea in October sank 41 percent, with both exports and imports falling as relations between the neighbors and U.S. allies languish at their worst level in decades amid antagonisms over longstanding historical issues and disputes over high-tech exports.
Overall, imports totaled 6.56 trillion yen ($60.5 billion) while exports were 6.58 trillion yen, leaving a trade surplus of 17.3 billion yen.
Analysts said lower export prices exaggerated the decline, but they forecast still weaker demand in coming months.
Adjusted for price changes, imports fell only 2.3 percent in October from the same month a year earlier, Tom Learmouth of Capital Economics said in a commentary.
That “supports our view that domestic demand was relatively resilient following the sales tax hike in October,” he said.
But relatively weak global demand suggest that export volumes will fall further in 2020. Learmouth forecast a 2.7 percent decline in exports in the coming year after a 2 percent drop this year.
On the domestic front, the increase in the sales tax to 10 percent from 8 percent appears to have had less impact than earlier hikes, economists say.
A downturn in the high-tech industry, especially for computer chip makers, also is thought to have bottomed out, raising hopes for a recovery in that sector.
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