Japan had an unexpected trade deficit of $1.8bn in May, despite a 14.9% rise in exports, according to new data.
However the country’s economic recovery has been praised in a report released today (June 19) by the International Monetary Fund (IMF) – though it has urged more reforms.
The trade figures just released show imports rose 17.8%, more than 2% above estimate – the highest rise in three years, while the 14.9% rise in exports was partly due to last year’s figures being weak following the Kumamoto earthquake.
The figures coincided with the publication of the IMF report on Japan, which praised the economic reform programme of prime minister Shinzo Abe, dubbed ‘Abenomics’, although it said much still needed to be done in terms of reform.
Abenomics, started in 2012, saw Abe tackle the longstanding stagnation of the Japanese economy – which has an ageing population – by stimulating growth by making it easier to borrow and increasing government spending.
He also started a major reform of cultural and workplace issues, such as encouraging women to return to work after starting a family, and making it easier for companies to sack underperforming staff.
“Abenomics has proven successful in easing financial conditions, increasing corporate profits, and boosting employment and female labor force participation,” said the report.
“Revised national accounts data indicate more robust GDP growth during 2013-15 than originally estimated, based largely on stronger private investment and consumption.”