Japan’s Ministry of Finance announced on Wednesday that the country’s trade deficit rose to 897.7 billion yen ($6.7 billion) in February, extending its trade deficit streak to 19 consecutive months. The trade imbalance was primarily due to an increase in energy imports and a weaker yen.
The preliminary data revealed that Japan’s imports surged 8.3 percent to 8.55 trillion yen in February, year on year, while exports rose 6.5 percent to 7.65 trillion yen, resulting in a wider trade deficit.
Despite the overall trade deficit, Japan managed to maintain a trade surplus with the United States of 530.5 billion yen, primarily driven by higher exports of automobiles, pharmaceutical products, and machinery. Japan’s exports to the United States soared 14.9 percent to 1.46 million yen, while imports rose 6.6 percent to 925.6 billion yen.
On the other hand, Japan’s trade deficit with China was 209.8 billion yen, with imports from China amounting to 1.53 trillion yen in February, a decrease of 0.6 percent year-on-year. Exports to China, on the other hand, plunged 10.9 percent to 1.32 trillion yen.
Japan has been struggling with trade deficits since the Fukushima disaster in 2011, which led to the shutdown of its nuclear plants and a consequent increase in fossil fuel imports. The COVID-19 pandemic has only exacerbated the situation by affecting supply chains and dampening demand for Japanese products in some of its biggest export markets.
The Finance Ministry’s announcement is likely to add to the Japanese government’s worries, as it seeks to boost exports and achieve a more balanced trade balance.