Japan experiences first trade deficit since 1980

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Japan experiences first trade deficit since 1980

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For the first time in more than 30 years Japan imported more than it exported.

That annual trade deficit in 2011 came as the nuclear power shutdowns after the March earthquake raised fuel import costs.

At the same time slowing global growth and the strength of the yen hit exports.

The numbers raise the question of how much longer can Japan rely on exports to help finance its huge public debt.

Total exports shrank 2.7 percent last year while imports surged 12.0 percent, reflecting reduced earnings from goods and services and higher spending on crude and fuel oil. Annual imports of liquefied natural gas hit a record high.

The trade figures underscore a broader trend of Japan’s declining global competitive edge and a rapidly ageing population, compounding the immediate problem of increased reliance on fuel imports due to the loss of nuclear power.

Only four of the country’s 54 nuclear power reactors are running due to public safety fears following the March disaster.

The situation could give added impetus to Prime Minister Yoshihiko Noda’s push to double Japan’s 5 percent sales tax in two stages by October 2015 to fund the bulging social security costs of a fast-ageing society.