Sagging exports have pushed Japan's trade balance into its first annual deficit in nearly 30 years. The numbers underscore the country's dependency on world trade, which has buckled under the pressure of the global economic slowdown.
The Ministry of Finance said yesterday that a 16.4 per cent slump in exports left Japan nursing an annual trade deficit of ¥725.3bn (£5.1bn), the first gap since 1980, when the country endured a ¥1.42 trillion shortfall.
Although demand for the "Made-in-Japan" label was weak in all the major regions of the world, the lack of appetite in the United States, the country's biggest trading partner, was particularly stark. Exaggerated by the slump in the American car market, where Japanese manufacturers such as Toyota and Honda have become prominent, exports to the US declined by a staggering 27.2 per cent.
In the same period, exports to the EU were down 23 per cent, while the figures for China were almost 10 per cent lighter than the year before.
Kaoru Yosano, the Finance Minister, said the country "should take the numbers seriously". He added: "We need to find out if Made-in-Japan products and services are still staying competitive internationally."
Economists searching for a silver lining hung on to monthly figures for March, which suggested that the decline in exports may have bottomed as "green shoots" sprout in parts of the world economy. Exports in March fell 45.6 per cent in year-on-year terms, an improvement over the 49.4 per cent decline in February. On a seasonally adjusted basis, exports were up 2.2 per cent from February, ending a four-month losing streak and sparking hopes of a recovery. The country logged a small surplus of ¥11bn in March.