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Chaos in US takes toll on exports from Japan
Evening Standard 25 Sep 2008Japan's exports are beginning to feel the pinch from the chaos in the US. Growth slowed in August, with a record drop in shipments to America.
Exports grew just 0.3% from a year earlier after rising 8% the previous month, the Finance Ministry said today.
Foreign sales have been the main driver of Japanese growth for the past six years.
Finance Minister Shoichi Nakagawa, just appointed by new Prime Minister Taro Aso, said the government will consider cutting taxes and increasing spending to buoy the flagging economy.
"Exports and capital investment, which led Japan's economy, are getting in a worrisome situation," Nakagawa said. "We need to do whatever we can do."
Japan had a trade deficit of 324 billion yen (£1.62 billion), the first since January, because of record oil imports.
The nation's import bill rose 17% from a year earlier.
Meanwhile, Honda has cut global production, building fewer sport-utility vehicles in North America. Its output fell 4.8% to 295,541 vehicles in August, led by a 10.2% drop in the US, the company said.
US new vehicle sales may fall to 14.2 million, the lowest total in 15 years, according to market researcher JD Power & Associates.
