Setting a record high for a seventh straight year despite diplomatic frictions, Japan's trade with mainland China jumped almost 10% in the six months to June, The Japan External Trade Organization (JETRO) reported Aug. 28.
Total trade between the two Asian economies came to $99.2 billion in the first-half period, up 9.9 % from a year-earlier. JETRO said that Japan's trade with China was likely to reach a new record for an eighth straight year in 2006, topping $200 billion.
In the six months, Japanese exports rose 15.3% -- more than double the growth rate in the same period last year -- to $42.8 billion, led by strong shipments of auto parts and digital home appliance components. Japanese companies, particularly auto makers, are shifting production to China to take advantage of its lower production costs and shipping the finished goods back to Japan to sell.
Japanese imports from China rose 6.1% to $56.3 billion, marking a sharp slowdown in growth mainly due to a slump in steel imports, JETRO said.
While Japan and China have seen severe diplomatic frictions in recent years, there has been little obvious impact on commercial ties. Japan's trade with mainland China accounted for 16.8% of its total external trade in the first half of 2006.
"Exports of electronic parts from Japan to China will continue to expand and imports from China to Japan will also increase as Japanese manufacturers continue to shift their production bases to China," JETRO predicted.
Copyright Agence France-Presse, 2006