Reuters reported that Japan's exports nearly halved in January 2009 from a year earlier, with record slides in shipments to the United States, Europe and the rest of Asia pointing to a deepening recession across much of the world.
Japanese car exports fell by two thirds from a year earlier, accelerating from a 45% annual decline seen in December, as the value of overall exports hit a 10 year low.
Mr Takeshi Minami chief economist at Norinchukin Research Institute said that "We do not see any signs of a pick up in the Japanese economy in the near term. The economy will gradually worsen further. Exports to Asia, particularly to China, are tumbling at about the same pace as shipments to the United States, signaling that even China's economy may be shrinking."
Japanese exports to the rest of Asia sank 46.7% from a year earlier, the fourth straight month of decline, with shipments to China falling 45.1%. The decline in Japanese exports to other emerging markets is also accelerating. Sales to Brazil fell by 38%, more than six times the drop seen in December data. Japan’s economy shrank last quarter at its fastest pace since the first oil crisis of the 1970s and economists said the latest figures added to concerns that the recession was worsening.
Japanese car makers also reported sharp falls in their output in January, with Toyota Motor Corporation reporting its biggest fall in global output and with that at Nissan Motor Co Limited slumping to the lowest level in records going back to 1984. Japanese industrial output is expected to have fallen by 10% in January, even deeper than the record fall seen in December. The dismal export figures point to further production cuts in the coming months as companies try to clear inventories.
Shrinking exports pushed Japan's trade deficit to a record JPY 952.6 billion, in an export oriented country where sales of major brands from autos, technology and other manufacturing sectors have been major drivers of growth. It was the biggest deficit since 1980, in the wake of the second Middle East oil crisis, but smaller than a forecast by economists of JPY 1.1295 trillion.
The trade balance has been in the red for four straight months, the longest such sequence in Japan in nearly three decades. The sharp deterioration has prompted big exporters to cut jobs and threatened their small suppliers and many economists expect the economy to keep shrinking well into this year.
(Sourced from www.reuters.com)
