April surplus down 21%

Kyodo

The current account surplus slipped 21.2 percent in April from a year earlier to ¥333.8 billion as the recovery in exports remained sluggish due to the sovereign debt crisis in Europe while imports continued to expand, government data showed Friday.

The surplus in the balance of international payments, one of the widest gauges of trade for a country, was underpinned by growth in revenues from overseas investments by Japanese firms, the Finance Ministry said in a preliminary report.

The goods trade balance stood at a deficit of ¥463.9 billion, the first red ink in three months, as the value of imports rose 11.2 percent to ¥5.886 trillion for the 28th straight month of increase, outstripping exports, which rose 11.1 percent to ¥5,421.6 billion for the second consecutive monthly growth.

Exports to the United States have recovered on the robust shipment of vehicles, but those to Europe and other Asian economies, including China, continued to slow as the debt crisis in the euro area increasingly weighed on global economic prospects, with the negative impact spreading outside the area through trade and financial channels.

Imports have been rising, due mainly to higher crude oil prices, as well as increased consumption by utilities of liquefied natural gas to boost thermal power generation to cover the loss of atomic power since the Fukushima No. 1 nuclear plant crisis started in March 2011.

“The recovery of exports is not strong enough, while imports continue to increase,” a ministry official said, pointing out that export growth could be further slowed depending on the situation in Europe and the yen’s strength in the currency market, which makes Japanese products relatively expensive abroad.

The balance of services trades came to a deficit of ¥498.6 billion, expanding from ¥380.1 billion in the same month a year before.