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Japan's 2015 trade deficit narrows on oil price tumble

Update: January, 25/2016 - 10:45
Japan remains highly dependent on energy imports to power the world's third largest economy but benefited from sharp falls in oil prices during 2015. - AFP Photo

TOKYO —  Japan's trade deficit narrowed sharply in 2015 as tumbling oil prices took pressure off its soaring post-Fukushima energy import bill, official data showed Monday, while autos led a pick-up in exports.

The deficit decline offered up some good news for Prime Minister Shinzo Abe as he struggles to stoke growth and ahead of a test to his leadership in upper house elections this summer.

Stronger demand in some key markets, including the United States, and a sharply weaker yen boosted exports from the world's number three economy, the finance ministry said.

The figures showed Japan recorded its fifth-straight annual trade deficit, but the latest figure narrowed by 78 percent from 2014 to 2.83 trillion yen ($23.8 billion).

Auto exports surged 10.3 percent from a year ago, while the value of crude oil imports dropped 41.0 percent.

For December alone, the nation saw a trade surplus of 140 billion yen,

returning to the black for the first time in two months.

Japan remains highly dependent on energy imports to power the economy, but a big drop in oil prices over the summer has taken pressure off the cost of its energy needs.

The nation has kept most of its nuclear reactors closed since a tsunami and earthquake triggered meltdowns at the Fukushima plant in 2011.

The accident forced Japan to turn to pricey imported fossil fuels to keep the lights on, leading to a string of big trade deficits.

"The continued weakening in energy prices is exacerbating the fall in import prices," said Marcel Thieliant at research house Capital Economics.

Abe has pushed to restart nuclear plants, backed by Japan's business community, but the public is sharply divided with many opposed to returning to atomic power. — AFP



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