Japan’s current account surplus in May dropped 27.9 percent from a year earlier as a continued rapid fall in the number of foreign visitors due to the coronavirus pandemic worsened the travel balance, government data showed Wednesday.
The balance, one of the widest gauges of international trade, stood at ¥1.18 trillion ($11 billion), remaining in the black for the 71st straight month, the Finance Ministry said in a preliminary report.
The surplus shrank for the third month in a row. It declined 84.2 percent in April.
Among key components, the country’s goods trade deficit narrowed 18.1 percent to ¥556.8 billion but the services balance swung from a surplus of ¥152.5 billion a year before to a deficit of ¥92.5 billion.
The travel balance, which reflects the amount of money foreign visitors spend in Japan versus Japanese spending abroad, registered a surplus of just ¥22.4 billion, down sharply from the previous year’s ¥270.1 billion due to strict travel restrictions over the pandemic.
According to the Japan Tourism Agency, an estimated 1,700 foreign travelers visited Japan in May, down 99.9 percent from a year earlier. It posted an all-time low for the second consecutive month following 2,900 visitors in April.
Exports fell 28.9 percent to ¥4.20 trillion, down for the third consecutive month. Shipments of cars and auto parts to the United States were sluggish as the outbreak dampened demand, a ministry official told reporters.
Imports dropped 27.7 percent to ¥4.75 trillion, down for the 13th successive month, partly due to falling crude oil prices.
Primary income, reflecting the net flow of profits, interest and dividends from investments in other countries, registered a surplus of ¥2.04 trillion, down 10.9 percent.
The official said some Japanese companies have postponed receiving dividends from their overseas subsidiaries as the financial position of the overseas units has deteriorated due to the pandemic.
The official also said the outlook is unclear as the pandemic situation “changes significantly every month.”