The data shows that Japan’s exports rose 6.2% in March from a year earlier, which is a significant slowdown compared to the 16.1% growth seen in February. The reason behind this sluggish growth is attributed to the global chip shortage, which has hit the production of electronics and automobiles in Japan, affecting exports.
On the other hand, imports surged by 17.8% in March, driven by a spike in oil prices and increased demand for foreign goods, leading to a wider trade deficit of 1.36 trillion yen ($12.4 billion). This represents the largest annual deficit since 2015 and a sharp increase from the 0.63 trillion yen ($5.7 billion) deficit recorded in February.
Experts suggest that the sluggish growth in exports and the widening trade deficit may lead to concerns over the Japanese economy’s recovery, which has been affected by the COVID-19 pandemic. Additionally, the pandemic has further complicated Japan’s trade relations with China, as the two nations continue to have strained diplomatic relations.
The data also showed that exports to China, Japan’s largest trading partner, grew 10.6% in March, a sharp slowdown compared to the 37.2% growth recorded in February. Exports to the United States rose 5.5%, while exports to the European Union increased by 4.1% in March.
The Bank of Japan has announced that it will continue to support the economy by maintaining low-interest rates and implementing quantitative easing measures. However, with the ongoing global chip shortage and rising oil prices, Japan’s economic recovery is likely to face headwinds in the coming months.
In conclusion, Japan’s export growth has slowed down in March 2023, leading to a widening annual trade deficit, which has reached a record high due to a surge in imports. The sluggish growth in exports and the widening trade deficit raise concerns over the Japanese economy’s recovery, which has been affected by the COVID-19 pandemic and the global chip shortage. (News source: Reuters/Edited By TWN Editorial Member )
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