Trade deficit tops 7.6 trillion yen (US$ 74.9 billion) as exports fail to keep pace with imports. Higher sales tax and higher fuel and gas imports because of nuclear power plant closures push Japan's trade balance into the red.

Tokyo (AsiaNews) - Japan's trade deficit hit a record 7.6 trillion yen (US$ 74.9 billion) in the first half of the year as exports failed to keep pace with surging imports, the Finance Ministry reported Thursday.

Imports for the six months jumped 10 per cent to 42.6 trillion yen (US$ 420 billion) whilst exports rose 3.2 per cent to 35.1 trillion yen (US$ 346 billion).

Japan's bulging import bill was partly due to a jump in demand as businesses and consumers stepped up purchases ahead of an April 1 increase in the sales tax from 5 per cent to 8 per cent.

"While the trade deficit widened last month, it remains much smaller than before the sales tax hike. This suggests that net trade finally ceased to be a drag on GDP growth last quarter," an expert said.

Higher imports of fuel and gas pushed Japan's trade balance into the red following the halting of all its nuclear reactors for safety checks after the 2011 disaster at the Fukushima Dai-Ichi nuclear plant.

In January-June, imports of liquefied natural gas rose 12 per cent whilst oil imports jumped 5 per cent.

By contrast, exports have not received much of a boost from the weakening of the yen in 2012-2013.

Japan remains heavily dependent on its vehicle exports, which rose 60 per cent from the year before in the first half of 2014.

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