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As China's economy slows, Japanese exports take a hit

Cars, chips and other goods suffer biggest decline in 7 years in April

Containers are stacked at an industrial port in Tokyo.   © Reuters

TOKYO -- The slowdown in China's economy caused by lockdowns in Shanghai and other cities sent Japanese exports to the country falling 22.6% by volume on the year in April, preliminary data released Thursday shows, the largest drop since February 2015.

Japan's Finance Ministry said its export volume index for China dropped to 110.9, with the 2015 level set at 100. This slide was the second consecutive month of decline in that index, and larger than the 13% dip in March.

Sharp declines were seen in major product categories. Automobile exports in April totaled 19,743 vehicles, down 30.2%. Steel fell 30.3% to 328,000 tons. Exports of power generating machinery fell 39.9% to 12,591 tons, while integrated circuits decreased 28.5% to 1.71 billion units.

Imports from China also declined. That index fell 20.4% to 92 for the largest decrease since February 2020, when coronavirus infections first began to spread.

Indexes for Japan's global export and import volumes fell 4.4% and 9%, respectively, due to the drop in trade with China. Both were the largest declines since summer-fall 2020, when the pandemic caused a slump.

Japan's trade balance worldwide was in a deficit of 839.1 billion yen ($6.52 billion) in April, the ninth straight month in the red. Imports swelled by 28.2% to 8.91 trillion yen, the highest on record for a single month, due to the surge in energy prices. Exports increased 12.5% to 8.07 trillion yen, the second-highest level on record after March.

Higher prices lifted the value of Japan's imports and exports despite declines in volume.

"The global increases in wages, logistics and other costs are having an impact," a ministry official explained. The ongoing depreciation of the yen against the dollar also spurred a rise in import prices.

Exports to China totaled 1.48 trillion yen, a 5.9% decrease by value. Imports fell 5.5% to 1.65 trillion yen. Due to the large decrease in trade volume with that country, the value of that trade also fell.

Japan's trade deficit with Russia was 163.3 billion yen, a 20% increase from the previous month. Exports totaled 23.7 billion yen, down 69.3%, mainly of automobiles and machinery. This was due to Tokyo's export bans in response to Moscow's invasion of Ukraine and voluntary suspensions of business by companies.

Imports rose 67.3% to 187 billion yen. Crude oil imports increased by 43.2% and coal by a factor of 2.7. Both were marked by an increase in price and a decrease in volume.

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