©Reuters. FILE PHOTO: A worker works at a container area at a port in Tokyo, Japan July 19, 2017. Picture taken July 19, 2017. REUTERS/Toru Hanai
By Tetsushi Kajimoto and Mariko Katsumura
TOKYO (Reuters) – Japan posted a trade deficit for the 16th straight month in November as imports surged to record levels, while subdued growth in exports to China stoked concerns about how the COVID disruptions there are affecting other economies could.
The trade deficit hit 2 trillion yen ($14.8 billion) — the fourth consecutive month of this level or more.
Imports increased in value by 30.3% year-on-year, more than the 27.0% increase expected by economists. They were led by imports of , coal and LPG and inflated by the yen’s 28.5% depreciation against the dollar.
Exports rose 20% in line with estimates and also hit a record, led by US demand for cars and mining equipment.
However, export growth to China, the world’s second largest economy and Japan’s largest trading partner, was just 3.5%, held back by weaker demand for chipmaking machinery and auto parts. This compares to double-digit percentage growth from July through September and a 7.7% increase in October.
“What struck me was the continued weakness in exports to China,” said Takayuki Miyajima, senior economist at Sony (NYSE:) Financial Group.
“Looking ahead, I am concerned about how the relaxation of China’s zero-COVID policy could affect the country’s entire supply chain.”
Japan posted a cumulative trade deficit of 18.5 trillion yen this year, up from the record annual trade deficit of 12.8 trillion yen for 2014.
Exports to the United States increased by 32.5%, EU exports increased by 32%, while exports to Asia (excluding China) increased by 11.6%.
($1 = 135.5100 yen)