Japan's current account surplus rises 50 pct in first half of 2021

Japan's current account surplus grew 50.3 percent in the first half of 2021 from a year earlier to 10.5 trillion yen (95 billion U.S. dollars), boosted by an improvement in exports from a slump caused by the COVID-19, government data showed Tuesday.

Among key components, the goods trade balance was a surplus of 2.3 trillion yen (21 billion dollars), improving from the previous year's deficit of 973.5 billion yen (8.82 billion dollars). Exports of cars, auto parts, and other items rebounded as the global economy gradually recovered from a pandemic-induced slump in early 2020.

Under a global chip crunch, the exports of shipments of semiconductor producing equipment increased by 22.2 percent to 39.2 trillion yen (360 billion dollars).

Due to a rise in materials prices such as nonferrous metals and iron ore, imports expanded 11.6 percent to 36.9 trillion yen (330 billion dollars), the Finance Ministry said.

At the same time, the services trade balance, which includes cargo shipping and passenger transportation, registered a deficit of 2.1 trillion yen (19 billion dollars), deteriorating from last year's 1.9 trillion yen (17 billion dollars).

The travel surplus of 105.5 billion yen (960 million dollars) was much lower than the 1.4 trillion yen (13 billion dollars) and 420.7 billion yen (3.81 billion dollars) marked in the first-six-month periods of 2019 and 2020, respectively, due to the tight international travel restrictions caused by the COVID-19 pandemic in many countries.

The travel balance reflects the difference between the amount of money foreign visitors spend in Japan and that of Japanese spend abroad.

"Last year, the impact from the coronavirus on the number of overseas tourists (to Japan) was hardly felt in January before it began to emerge in February. But this year, there have been almost no visitors from the start," a ministry official said.

Due to an increase in returns on direct overseas investments, primary income reflecting returns on overseas investments recorded a surplus of 11.4 trillion yen (100 billion dollars), a rise of 6.6 percent, to log the largest black ink since 1985 when comparable data became available.

In June alone, the current account surplus increased more than six times to 905.1 billion yen (8.2 billion dollars) from a year earlier, remaining in the black for 84 months.

Japan overall registered a goods trade surplus of 648.5 billion yen (5.88 billion dollars), a services trade deficit of 346.4 billion yen (3.14 billion dollars), and a surplus of 680.5 billion yen (6.17 billion dollars) for primary income.