Japan's exports rose 38% in April from a year earlier, boosted by a rapid recovery in overseas markets, according to preliminary statistics released by the Ministry of Finance on May 20, Kyodo News reported. The increase was higher than economists' forecast of 30.9%, the biggest increase since April 2010. At the time, the world economy was recovering from the global financial crisis and Japan's exports jumped 40.4 per cent in April 2010.

It was the second consecutive monthly increase in exports, following a 16.1 per cent rise in March. Exports from Japan rose 38.0 percent in April to 7.1811 trillion yen (109 yen to the dollar), driven by a sharp drop in exports from a year earlier, the report said, citing strong growth in automobiles, semiconductor manufacturing equipment and auto parts. Imports rose 12.8 percent year on year to 6.9258 trillion yen in April, driven by higher imports of crude oil, petroleum products and non-ferrous metals. The trade surplus for the month was 255.3bn yen, the third consecutive monthly surplus.

It is worth mentioning that Japan's exports in April increased by 7.8 percent compared with April 2019, exceeding the pre-epidemic level. However, the Kyodo report stressed that in the context of a global semiconductor shortage, auto makers have been forced to cut production, the future full recovery may face resistance.

From the perspective of countries and regions, thanks to the continuous recovery of China's economy, Japan's exports to China maintained growth for 10 consecutive months. Exports to China increased by 33.9% year-on-year to 1.5834 trillion yen in the same month, and China continued to maintain its position as Japan's largest export market. Exports to the U.S., the European Union and Asia all rose from a year earlier. Exports to the US jumped 45.1 per cent to 1.2761tn yen in April, the data showed. Exports to the European Union also rose 39.6 percent to 676.1 billion yen in April on the back of strong auto sales.

"Japan's export situation has improved thanks to the rapid recovery of China's economy and the growing pace of recovery in the United States, thanks to its steady promotion of vaccines and massive stimulus program," said Takeshi Minami, chief economist at the Institute of Agriculture, Forestry and Finance, according to Kyodo.

A strong recovery in exports has been supporting Japan's economy. Japan's economy is suffering from sluggish consumption after the government declared a third state of emergency in late April because of the spread of a more contagious strain of the virus.

Mr Minami said the reliance on exports for Japan's economic recovery was expected to continue, given the country's slow introduction of vaccines. At the same time, he noted that the risk of a global shortage of semiconductors, which are needed components for cars, could dampen car exports.