Japan has announced an 11 billion yen ($139 million) trade deficit for May, as demand from the European Union is curtailed by the debt crisis in Greece and Spain, according to the Financial Times.
This underlines Japan’s increasing vulnerability as it struggles to recover from its own debt problem. The export-dependent country still enjoys surpluses with trading blocs in Asia and North America, amounting to 165 billion yen and 301 billion yen respectively.
Analysts say that Japan “can no longer rely on a positive balance from the EU” with the looming eurozone crisis and unpredictable global demand. The 11-billion yen trade gap is Japan’s first shortfall since 1979, according to finance ministry data. Citi chief economist Kiichi Murashima told the Financial Times, “export weakness last month was very broad-based, from chemicals to machinery”.
Japan’s trade deficits was exacerbated by a surging energy import bill after the Fukushima nuclear crisis prompted the government to import alternative energy after it shut down its remaining nuclear facilities. Japan imports natural gas, crude oil and petroleum with a value which amounted to 6.142 billion yen in May, according to the Wall Street Journal.