Press TV reported that a larger than expected trade deficit has hit Japan as Europe’s debt crisis slows exports and higher oil prices, precipitated by the illegal US led sanctions against Iran increase the cost of imports for the East Asian country.

Japan’s Ministry of Finance said that the country’s trade balance had left a deficit of JPY 517.4 billion in July almost double a market forecast of a JPY 275 billion deficit and contrasted with the surplus of JPY 60.3 billion in June. The month’s overall exports were also down by 8.1% to JPY 5.31 trillion in a blow to Japan’s export reliant economy.

The country’s exports to the European Union fell by 25.1% against a 10.6% rise in imports on the back of less demand from the European nations. The fall contributed JPY 95.2 billion to the overall deficit. Japan’s exports to China also plunged by 11.9% against 3.3% rise in imports incurring a deficit of JPY 250.1 billion. Meanwhile, Japan’s overall imports increased by 2.1% to JPY 5.83 trillion on persistent surges in energy imports.

Japan has turned to fossil fuel alternatives and increased its energy imports after its nuclear reactors were shut for safety tests following last year’s crisis at a nuclear power plant in Fukushima.

Source - Press TV

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