Japan exports rise 38% as global car demand picks up

Photo: EPA

Japan posted a record growth in exports of goods as global demand for cars and electronics increased, Reuters reported. Official figures showed that the speed in exports growth in April is fastest since 2010. The data fueled optimism that the world third largest economy is firmly on track of recovery from the pandemic slowdown. Also brightening the outlook, confidence among the nation's manufacturers hit a more than two-year high in May on the back of solid overseas orders.

Global appetite for cars and electronics has picked up since last year, driven by a recovery in the US and Chinese economies - Japan's key markets - although global chip shortages put a drag on overseas shipments in recent months.

Exports rose 38.0% in April from a year earlier, official data showed, compared with a 30.9% increase expected by economists and following a 16.1% rise in March. That was the fastest gain since April 2010, led by US-bound shipments of cars and car parts and Chinese demand for chip-making equipment. "The trade data confirmed that exports were recovering steadily. Particularly car exports, which fell a lot last year, are picking up," Yuichi Kodama, chief economist at Meiji Yasuda Research Institute told. "In Japan, capital spending tends to move in sync with external demand, so an export recovery is encouraging for machinery orders and capital expenditure."

By destination, exports to China, Japan's largest trading partner, rose 33.9% year-on-year in April, led by shipments of chip-making equipment, hybrid cars and scrap copper.

US-bound exports grew 45.1% in the year to April, the fastest gain since 2010, on the back of demand for automobiles, car parts and ship engines.

Japan's economy fell back into decline in the first quarter and economists have sharply revised down estimates for growth this quarter as emergency curbs hobble consumer spending that makes up more than half the economy.

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