Japan's Export Growth Unexpectedly Quickens to 8.7% By Jason Clenfield
March 26, 2008 -- Japan's export growth unexpectedly accelerated in February as demand from emerging markets helped automakers ride out the U.S. slump. Exports, which contributed more than half of the economy's expansion last quarter, climbed 8.7 percent from a year earlier after increasing 7.6 percent in January, the Finance Ministry said today in Tokyo. The median estimate of 19 economists surveyed by Bloomberg News was for a 7.5 percent gain. Consumers in China and Indonesia are helping Hino Motors Ltd. and Honda Motor Co. make up for waning demand in the U.S., Japan's largest market. Overseas sales are proving resilient even after a slump in the U.S. dragged the dollar down 12 percent against the yen this year. ``This is an impressively strong number and we may need to reassess the outlook for exports,'' said Richard Jerram, chief economist at Macquarie Securities Ltd. in Tokyo. ``Exports are less sensitive to the U.S. slowdown than expected.'' Imports increased 10.1 percent, and the trade surplus widened 0.9 percent to 969.9 billion yen ($9.7 billion), the ministry said. The yen rose to 99.96 per dollar at 11:59 a.m. in Tokyo from 100.07 before the report was published. Japan's currency surged to a 12-year high against the dollar last week, eroding exporters' earnings. Toyota Motor Corp., Japan's biggest carmaker, last week said the company may miss its sales target this year because the yen's gains make its cars more expensive in the U.S. Global Demand Export growth to Asia quickened to 13.9 percent in February from 8.l percent a month earlier, today's report showed. Shipments to China rose 14.9 percent, and sales to Europe gained 7.2 percent. Exports to the U.S., meanwhile, slid 6 percent from a year earlier, a sixth monthly decline. ``So far Japanese exports have held up nicely,'' said David Cohen, director of Asian economic forecasting at Action Economics in Singapore. ``The big question is whether growth in the rest of the world will hold if the U.S. goes off a cliff.'' Sales to Indonesia and Latin America helped Hino Motors, Japan's largest maker of heavy-duty trucks, beat its own forecast for operating profit for the year ending March 31, the Tokyo- based company said yesterday. China, India The International Monetary Fund forecasts that, despite the slower U.S. growth, the global economy will expand 4.1 percent this year, above the average 3.7 percent over the past quarter century. Emerging markets including China and India aren't only boosting world growth, they're also creating new customers for other Asian exporters. ``If we get world growth anywhere near what the IMF's projecting, that means somebody out there is going be buying Japanese stuff,'' Cohen said. ``If Korea and Taiwan can do it, why can't Japan?'' South Korea's exports climbed 20 percent in February, as Samsung Electronics Co. and Hyundai Heavy Industries Co. sold more mobile phones and ships to China and the Middle East. Orders for Taiwanese exports, an indicator of shipments over the next 90 days, rose 18 percent. Waning demand in the U.S, the world's biggest economy, may eventually take its toll on the emerging markets where Japan ships about half its goods, according to Economic and Fiscal Policy Minister Hiroko Ota. U.S. consumer confidence fell more than forecast in March, a report showed yesterday, as Americans' outlook for the economy dropped to the lowest level since Richard Nixon was president. ``We need to watch the depth and duration of the U.S. slowdown and the effect it will have on the corporate sector,'' Ota said yesterday.
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