Japan’s exports posted their strongest growth in more than three years in March, led by a surge in China-bound shipments, in a sign the economy continued to recover from last year’s deep coronavirus slump.
The trade data is unlikely to completely ease worries about the fragile recovery of the world’s third-largest economy, which took an enormous hit from a collapse in global trade due to the pandemic in the first quarter of 2020.
Ministry of Finance data showed on Monday exports surged 16.1% in March from a year earlier, marking the steepest rise since a 16.2% gain in November 2017. That was better than an 11.6% jump expected by economists in a Reuters poll, and followed a 4.5% contraction in February.
“The rebound in exports slowed significantly across Q1 and external demand is unlikely to provide much of a tailwind to growth this year,” said Tom Learmouth, Japan economist at Capital Economics.
“The impressive annual figure was down to base effects from the weakness in exports in March 2020.”
By region, shipments to China, Japan’s largest trading partner, soared 37.2% in the year to March, seeing their biggest gain since January, led by nonferrous metals and plastic materials, and also boosted by stronger exports of semiconductor machinery.
Exports to the United States, the world’s top economy, rose 4.9%, as strong demand for cars and construction machinery such as bulldozers offset lower shipments of aircrafts.
Shipments to Asia as a whole gained 22.4%, while those to the European Union advanced 12.8% in March.
Imports rose 5.7% in March compared with the same month a year earlier, versus the median estimate for a 4.7% increase, bringing a trade surplus of 663.7 billion yen ($6.11 billion) versus the median estimate for a 490.0 billion yen surplus.
The trade data follows the Reuters Tankan poll on Friday that found confidence among Japanese manufacturers rose to a more than two-year high in April as strong demand in the electronics market boosted prospects for exporters.