Japanese exports plunged at their fastest-ever rate in January, dropping by nearly half from the level recorded a year ago as the global economic crisis continues to cut deeper into the world's second largest economy.
Data released by the ministry of finance on Wednesday showed that exports plunged a record 45.7 per cent, pushing the country's trade deficit to $982.7bn, the biggest on record.
Shipments of cars, machinery, electronics and semiconductors – traditionally Japan's biggest export earners – have all plunged as consumers in major overseas markets rein-in spending.
Japanese exports to the US fell by 53 per cent in January, with shipments of cars down by 81 per cent on a value basis.
Recent months have seen Japan, China, Singapore and other export-dependent Asian economies report steep falls in trade as demand in key markets such as the US and Europe dries up.
South Korean exports fell a record 33 per cent in January from the previous year, Taiwan's slumped 43 per cent, and Singapore's fell 35 per cent.
Production cuts
Wednesday's figures also showed Japanese exports to other Asian countries also declining by 46.7 per cent, the fourth straight month of falls, with shipments to China falling 45.1 per cent.
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| Japan's export-dependent economy has been hit hard by plunging global demand [EPA] |
Previously exports to emerging economies have helped prop up Japan's trade surplus even as US and European markets slowed.
Many Japanese companies ship automobile and consumer electronics parts to assembly lines throughout Asia, from which final products are shipped to countries across the globe.
But a collapse in global demand since late last year, has led to a sharp increase in inventories and forced many leading Japanese companies to slash production at a rapid pace.
On Friday the government is scheduled to release other key data, including industrial production and unemployment figures expected to show the impact of the export collapse.
The dismal export figures point to further production cuts and job losses in coming months as companies try to clear inventories of unsold goods.
Japan's trade balance has been in decline for four straight months, the longest such sequence in nearly 30 years.
Imports also fell by 31.7 per cent in January, marking a third consecutive month of drops from a year earlier.
Last week Japan's economy minister said the country was facing its worst crisis since World War II after statistics showed the Japanese economy contracting at its fastest rate since the global oil crisis of the mid-1970s.