Japan Lowers Stance on Exports
By TAKASHI MOCHIZUKI
TOKYO—Japan's government Tuesday downgraded its assessment of exports in its economic report for February, partly because of concerns stemming from Toyota Motor Corp.'s recall of millions of vehicles world-wide.
The government left its overall economic assessment unchanged for the seventh straight month, saying "the economy has been picking up," but it remains in a "difficult situation" and there aren't many positive domestic factors supporting demand.
It downgraded its assessment of exports to "increasing moderately" from "increasing" a month ago. The downgrade was partly due to "Japanese cars' recall issues," said Keisuke Tsumura, a parliamentary secretary at the Cabinet Office.
The report itself didn't mention the auto giant by name, as the government believes the problem isn't yet serious enough to derail the current economic recovery, and a further fall in exports is unlikely, Mr. Tsumura said.
But the possibility that the recall could pose a downside risk to the export-reliant economy hasn't been ruled out, and the government is alert to whether additional economic stimulus measures may be needed.
Toyota has recalled nearly nine million vehicles world-wide following a series of complaints and a slew of lawsuits linking vehicle flaws to 30 deaths in the United States.
"It is very disappointing. Sales of Japanese cars are already decreasing in the U.S. We've concluded we must watch developments cautiously," Mr. Tsumura said.
He cited private research showing sales of Japanese cars in the U.S. dropped by 4.3% in January from a year ago. He also said feedback from U.S. retailers show demand for Japanese cars in the U.S. isn't in good shape in February, either.
The government is also wary about the impact of Toyota's recall on domestic private spending, although there hasn't been any notable impact yet. The government kept its view unchanged that private spending is "picking up" in February.
Aside from the Toyota recall, Mr. Tsumura said moderating shipments to Asia contributed to the downgrade in the export assessment. Official data show the volume of exports fell 1.3% from a month ago in December.
The government judged that at this point, the moderation is because of an increase in inventories to a healthy level, and therefore, isn't a cause for worry, Mr. Tsumura said.
"The pace of exports to Asia has reached cruising speed due to inventory adjustments," he said.
Japan's government also cut its view of imports to "picking up moderately" from "picking up," due to decreased imports of materials used to make products for overseas.
Greece's fiscal concerns could become a downside risk by negatively affecting financial markets, but the impact on Japan so far hasn't been serious enough to mention in the monthly report, Mr. Tsumura said.
Write to Takashi Mochizuki at takashi.mochizuki@dowjones.com
online.wsj.com |
