Tariffs hits Japan’s exports
Exports from Japan to the US dropped by 10.2 per cent year on year to ¥9.71 trillion – or about NZ$111.5 billion – in the first half of 2025/26 for the first decline since the second half of the 2020 financial year amid higher tariffs imposed by Donald Trump.
During the six months through to September, Japan’s trade surplus with America contracted by 22.6 per cent to ¥3.32tn, marking the first decline in a year, as car exports plunged 22.7 per cent in value terms.
Imports fell by two per cent to ¥6.39tn, marking the second consecutive half-year period of decline, according to the Finance Ministry in Japan.
After Trump implemented aggressive trade policies in April, Tokyo and Washington reached a deal in July to slash the levy on vehicles from 27.5 to 15 per cent, which took effect in mid-September.
As vehicle shipments to the US also declined 2.4 per cent by volume, Takafumi Fujita, an economist at the Meiji Yasuda Research Institute, attributes the drop to price increases by Japanese carmakers seeking to offset the tariffs.
He says: “It is difficult for Japanese automakers, which tend to supply affordable cars rather than luxury vehicles, to maintain sales volume when their price competitiveness weakens.” He adds a downturn in the automotive industry will weigh on the entire economy given its broad influence.
Globally, Japan’s trade deficit in the first six months of the fiscal year fell by 61.2 per cent to ¥1.22tn. Exports edged up 0.2 per cent to ¥53.65tn while imports dropped by 3.2 per cent to ¥54.88tn.
