Japan’s exports fell 1.7 per cent year-on-year, the country’s Finance Ministry reported on Wednesday, saying it was a direct impact of the shipment of autos to the US dropping by nearly 25 per cent from the previous year due to higher tariffs imposed by US President Donald Trump.
Trump has imposed a 25 per cent additional tariff on Japanese autos, and a 24 per cent tariff on other goods. He also recently said that the auto tariff may become even higher.
The decline of 1.7 per cent in exports is less than the figure that analysts had forecast, the ministry said. The country’s imports, meanwhile, sank 7.7 per cent, reflecting weakening domestic demand and worse than the 2 per cent fall recorded in April.
The trade deficit in May was 637.6 billion yen, or $4.4 billion.
Japan’s Prime Minister, Shigeru Ishiba, met with the US president at the Group of Seven summit in Canada earlier this week, but the two sides were unable to agree on some points. The tariffs issue, therefore, hangs in the air.
Ishiba has emphasised that Japan is an important ally in a key bilateral defence alliance with Washington, and that he is pushing to protect his own country's national interests.
The auto industry is a pillar of Japan’s economy, with the country exporting more than a million vehicles to the US a year. Tokyo has repeatedly stressed that automakers like Toyota and Honda produce cars in North America, contributing to the economy and creating jobs.
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