Japan's large trade deficit with China is expected to grow further this year as the growth in imports to meet domestic demand outpaces sluggish exports to the Chinese market, the country's trade promotion body said Tuesday.
The deficit with China was the biggest among Japan's trading partners in 2013, at $52 billion. Saudi Arabia and Qatar, both major oil and gas suppliers to Japan, were ranked second and third.
While an increase in energy imports since 2010 has been the largest contributor to the deteriorating balance, trade deficits with China have also been a key factor, accounting for 26% of an overall Yen18 trillion ($78 billion) reversal in the overall trade balance over the period, according to JPMorgan.
The Japan External Trade Organization, a government affiliated body, said that trade between the two countries is expected to grow in 2014 for the first time in three years. Data from China showed that bilateral trade between the two countries was up 10.6% in January from the same period last year.
隶属日本政府的日本贸易振兴机构(Japan External Trade Organization)称，2014年中日双边贸易预计将实现三年来的首次增长。中国的数据显示，今年1月份中日两国的双边贸易同比增长了10.6%。
Trade ties have suffered since 2012 when a long-running territorial dispute flared up, sparking consumer boycotts of Japanese goods in China. For 2013, trade with China fell 6.5% due to the continuing chill in relations as well as a slowdown in China's growth rate. China remained Japan's biggest trading partner, however, ahead of the U.S. and South Korea.
Sales of Japanese cars, which were hit hard by the anti-Japanese sentiment, are among those recovering, Jetro says.
The share of Japanese brands in the Chinese new car market rose to 19.7% in December, from a low of 7.6% in October 2012, nearly returning the recent peak of 23.2% marked in July 2011, Jetro said citing Chinese auto sales data.
But as trade ties improve, China is expected to be the main beneficiary, with imports of smart phones and other items from China expected to grow faster than exports of Japanese cars and construction and mining equipment.
Yoichi Maie, Jetro's research director for China, stressed the need for Japanese companies to search for new areas of business.
He noted that Japanese products that are widely considered as 'cool' in China continue to enjoy brisk sales.
Sales of leisure items, such as sports shoes and camping gear, have also benefited from growing purchasing power of Chinese consumers, who have begun to spend more time for leisure and entertainment.
One such item is Kawasaki Heavy Industries' 'Ninja' motorcycle, whose sales jumped 19 times in 2013. Another item that has seen brisks sales are Japanese hairpieces, whose sales jumped 7-fold in 2013.
以川崎重工业公司(Kawasaki Heavy Industries)生产的Ninja摩托车为例，其2013年销量劲增19倍。日本产的假发也是畅销品之一，2013年销量增长了七倍。
'Japan cannot keep on exporting the same products, which will eventually be replaced by local products,' Mr. Maie said. 'Exports can only be increased by exploring new fields.'