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Japan's exports fall most since January
JAPANESE exports dropped the most since January as China's slowdown, the trade conflict between Washington and Beijing and softness in the global tech sector continued to weigh on overseas demand.
The value of shipments abroad fell 8.2 per cent in August from a year earlier, according to the finance ministry. Economists surveyed by Bloomberg had estimated a 10 per cent drop.
Shipments to China suffered the second-largest drop in the last three years with sharp falls in chip-making equipment continuing. The trade balance showed a deficit of 136.3 billion yen (S$1.73 billion).
Slowing demand overseas, especially in China, has weighed on Japan's exports, one of the economy's main drivers of growth.
The US-China trade war makes the outlook for Japanese shipments uncertain, while Japan and South Korea have their own tensions.
The threat of possible US tariffs on Japanese cars and auto parts is another cause of uncertainty. President Donald Trump said a trade deal with Japan had been reached earlier this week, but didn't say whether it would end his auto-tariff threat. Japan's foreign minister Toshimitsu Motegi said Tokyo wants any deal to lay the issue to rest.
Weak exports make Japan's economy particularly vulnerable at a time when the nation's households are bracing for next month's sales tax hike. Consumer spending has supported growth recently.
Shipments to South Korea fell 9.4 per cent, fallout from the trade dispute between the two neighbours as tensions over Japan's colonial past continue to simmer.
Food exports, including beer, which has been boycotted by some South Koreans, slumped 41 per cent.
Imports fell 12 per cent in August, versus economists' median estimate of a 10.7 per cent drop.
Exports to China dropped 12.1 per cent in August, while shipments to the US decreased 4.4 per cent.
Exports of chip-making equipment to China slid 38.7 per cent and by 24.5 per cent overall. BLOOMBERG