Japan has announced
its first annual trade deficit in more than 30 years, a setback for a
country known for its exports including cars and electronics.
The deficit came in at 2.49 trillion yen ($32bn; £20bn) for 2011, the finance ministry said.Japan's imports rose 12% and its exports fell 2.7%, compared to the previous year.
The decline in exports was attributed to the impact from the earthquake and tsunami on 11 March.
Struggling exporters
The deficit underscores the pressure that Japanese exporters have come under since the disaster.
Factories were damaged and supply chains disrupted for major exporters including Toyota Motor and Sony.Exporters' problems have been exacerbated by further disruptions to production in some of their Thailand facilities due to flooding, as well by a rising yen, which makes Japanese products more expensive overseas.
The uncertainty surrounding Europe and the US has caused global investors to turn to the yen, as a safer investment, causing it to appreciate.
Analysts warned the combination of these factors was hurting Japan's exporters as rivals from South Korea and other Asian nations compete in markets which Japanese companies had previously dominated.
"It reflects fundamental changes in Japan's economy, particularly among manufacturers," said Hideki Matsumura of Japan Research Institute.
"Japan is losing its competitiveness to produce domestically."
