Slump in Japan's exports fuels fear

Japanese exports have nearly halved from a year ago, official figures showed yesterday, stoking fears that the world's second largest economy is heading even deeper into recession.

The country's dismal February trade performance was the latest in a string of bleak economic figures. It fuelled expectations that Japan was on course to suffer a steep fall in output in the first three months of 2009 that could match or even exceed the 3.2 per cent quarter-on-quarter decline recorded in the final three months of last year.

Japan, which is highly dependent on exports for growth, achieved a slim trade surplus of Y82.4bn ($844m) last month, after suffering a record deficit of more than Y950bn in January.

However, it did so only because of a record 43 per cent drop in imports to Y3,443bn. That fall underscored the nation's fast diminishing appetite for raw materials and weakening domestic consumer demand.

Exports fell 49.4 per cent year-on-year to Y3,525bn, their worst performance since Japan began keeping comparable trade statistics in 1980.