Japan’s exports rose for a sixth consecutive month in March, driven in part by accelerating shipments ahead of sweeping U.S. tariffs introduced by President Donald Trump.
However, the export boost comes amid rising fears over the future of Japan’s trade-reliant economy.
Data released Thursday showed the trade surplus reached 544.1 billion yen ($3.84 billion) in March, exceeding forecasts of 485.3 billion yen. Imports, however, rose just 2% year-on-year, falling short of the 3.1% growth economists had anticipated.
The surge in exports comes after President Trump announced a 25% tariff on car and truck imports on April 2, while threatening to impose a broader 24% tariff on all Japanese goods. That sweeping measure has been temporarily reduced to a 10% baseline for 90 days as negotiations continue.
Japan exported 21 trillion yen worth of goods to the United States last year, with automobiles accounting for nearly 28% of that figure. The country’s industrial supply chain—especially its auto sector—is now facing renewed pressure.
Japan produces around 9 million vehicles annually, exporting approximately 1.5 million to the U.S., in addition to over 1.4 million more from production hubs in Mexico and Canada.
Bank of Japan Governor Kazuo Ueda on Thursday warned that the U.S. tariff policy introduces heightened uncertainty for Japan’s economy, not only through direct trade impacts but also via financial market volatility.
“We will scrutinise developments and their impact on Japan’s economy without any pre-conception at each policy meeting,” Ueda told parliament.
In response to the shifting trade landscape, automaker Nissan (7201.T) is reportedly planning to reduce production of its top-selling U.S. model, the Rogue SUV, at its Japanese facilities from May through July.
Meanwhile, Trump signaled optimism over negotiations with Tokyo, claiming “big progress” during surprise talks with Japanese officials in Washington. Japan is pushing for a full removal of the additional tariffs.
As trade tensions persist, analysts warn that Japan’s short-term export momentum may be overshadowed by long-term uncertainty, particularly if U.S. tariffs remain in place or escalate further.
