May 12, 2014 10:52 am JST

Japan's current account surplus marks record low in FY 2013

TOKYO (Kyodo) -- Japan's current account surplus in fiscal 2013 was the smallest since comparable data became available in fiscal 1985, as soaring fossil fuel imports drove up the nation's trade deficit amid the prolonged halt of nuclear power plants, government data showed Monday.

     A record goods trade deficit of 10.86 trillion yen brought the country's annual current account surplus -- one of the widest gauges of international trade -- to 789.9 billion yen in the last business year, down 81.3 percent from a year earlier, the Finance Ministry said in a preliminary report.

     The current account surplus shrank for the third straight year, after the devastating March 2011 quake-tsunami disaster hit northeastern Japan and triggered an emergency at the Fukushima Daiichi nuclear power, the ministry said.

     In fiscal 2013 through March 31 this year, exports climbed 12.2 percent to 69.80 trillion yen on the back of the yen's depreciation, but imports surged 19.6 percent to 80.67 trillion yen. The annual goods trade balance -- exports minus imports -- consequently fell into the red for three years in a row.

     Imports of crude oil jumped 18.4 percent and liquefied natural gas increased 18.2 percent, while the Japanese currency slid versus the U.S. dollar by 20.8 percent and the euro by 25.7 percent on year on an average basis.

     A falling yen usually supports exports by making Japanese products cheaper abroad and boosts the value of overseas revenues in yen terms, but it drives up import prices. Japan depends on imports for more than 90 percent of its energy needs.

     Last fiscal year, the surplus in the primary income account, which reflects how much Japan earns from its foreign investments, gained 14.0 percent from the previous year to a record high of 16.66 trillion yen.

     It was the fifth straight year of rise in the income account, buoyed by higher dividends and profits from securities investments due largely to the weaker yen, the ministry said.

     The services sector, including passenger transportation and cargo shipping, registered a deficit of 3.58 trillion yen last fiscal year. The deficit, however, became smaller from fiscal 2012 as the number of foreign travelers to Japan increased.

     In March alone, Japan posted a current account surplus of 116.4 billion yen, down 90.9 percent from a year earlier.