Japan suffers 1st Asian loss

Japan suffers 1st Asian loss

TOKYO (AFP): Japan suffered its first trade deficit with Asia
in eight years in January while its surplus with the United
States grew ever larger, pushing the month's overall surplus up
to 381.5 billion yen (US$3 billion), the finance ministry said
yesterday.

Trade with Asian neighbors registered its first deficit since
January 1990 as the region's financial crisis struck home, with
exports to South Korea, Thailand and Indonesia hardest hit.

Yet the politically sensitive trade surplus with the United
States soared more than 65 percent, the ministry said.

The overall surplus reversed a 24.5 billion yen deficit
recorded a year earlier, the ministry said.

"Exports to Asia have been weakening recently, due to falls in
demand in countries hit by the currency crisis," a ministry
official said.

It is the first clear effect of the crisis on the trade
figures of the world's second largest economy and could signal
the start of a long-running decline in the region, analysts
warned.

"Japan's trade surplus is likely to expand year-on-year for
the time being, given the recent trend, but the surplus is not
likely to continue to expand sharply in the mid to long term,
taking into account the ongoing changes of economic and trade
structure," the official said.

Exports in the month rose 8.8 percent year-on-year to 3,853.7
billion yen, expanding for the 30th straight month.

The increase was led by a 27.5 percent rise in ship exports,
and a 22.8 percent growth in auto exports, both in terms of
value.

Imports dropped 2.6 percent to 3,472.2 billion yen, the first
decline in two months, the ministry said.

Japan's trade with Asian countries, a crucial area which
absorbs some 40 percent of Japan's exports, left a deficit of
34.3 billion yen in January.

Exports to Asia slumped 9.4 percent to 1,260.2 billion yen and
imports shrank 2.8 percent to 1,294.4 billion yen.

Exports to countries hit by the currency crisis fell sharply
-- down 41.6 percent year-on-year for South Korea, down 34.5
percent for Thailand and down 18.3 percent for Indonesia.

Japan's trade surplus with the United States surged 65.7
percent from a year earlier to 493.9 billion yen, the 16th
consecutive monthly rise, led by brisk demand there.