1st-half current account surplus hits high since 2nd-half 2007

August 8, 2017

TOKYO- Japan's current account surplus in January-June hit the highest level on a half-year basis since the second half of 2007, before a global financial crisis was triggered by the 2008 collapse of US investment bank Lehman Brothers, the Ministry of Finance said Tuesday.

Japan's first-half surplus in the balance of international payments, covering cross-border investment, as well as goods and services trade, came to 10,510.1 billion yen, up 0.3 percent from a year earlier, according to a preliminary MOF report.

While Japan saw its goods and services trade surplus drop 15.4 percent to 1,755.7 billion yen in the six months, its primary income account surplus increased 2.2 percent to 9,762.2 billion yen, with Japanese companies enjoying a rise in dividend income from overseas subsidiaries.

In goods trade, Japan posted a surplus of 2,053.1 trillion yen, down 11.7 percent.

Exports expanded 10.1 percent to 37,307.6 billion yen, on the back of brisk shipments of semiconductor manufacturing equipment and automotive parts. Imports jumped a steeper 11.8 percent, totaling 35,254.5 billion yen, reflecting surges in natural resource prices.

In services trade, Japan incurred a deficit of 297.4 billion yen, larger than the year-before red ink of 248.9 billion yen, chiefly due to a fall in royalty income regarding intellectual property rights. The country's travel account surplus renewed its record high on a half-year basis, thanks to a rise in inbound tourists.

In June alone, Japan's current account surplus fell 4.3 percent from a year before to 934.6 billion yen, the MOF also said.

The monthly surplus topped a median forecast of 806.8 billion yen in a Jiji Press poll of 20 economic research institutes.

In the month, Japan logged a goods and services trade surplus of 468.6 billion yen, down 22.5 percent, with a goods trade surplus of 518.5 billion yen, down 32 percent. Exports were up 9 percent at 6,370.9 billion yen, while imports were up 15.1 percent at 5,852.4 billion yen.

The monthly surplus in the primary income account expanded 22.9 percent to 507.2 billion yen.Jiji Press