London, Aug.22 : China has become Japan's top export destination, overtaking the US for the first time last month, reports the Financial Times.
Exports to China, which have risen in each of the last 38 months, expanded by 16.8 per cent in July to their highest level since the Japanese government began compiling statistics in 1950. At the same time, exports to the US declined by 11.5 per cent, marking the 11th consecutive monthly drop.
Overall, shipments rose by 8.1 per cent by value, after falling in June for the first time since 2003, the finance ministry said.
Japanese companies such as Toyota, Honda Motor and Komatsu have recently identified an increasing reliance on China and other emerging markets for sales growth as the US economy slows.
However, the export growth will provide little cheer to policymakers, faced with rising input costs and an uncertain outlook in the economies of Japan's main trading partners.
Many analysts expect exports to fall again in coming months as the slowdown in western economies begins to have an impact on demand in emerging economies such as China.
Given China's growing dependence on the EU as an export destination, Chinese growth was likely to decelerate, leading in turn to a slowdown in Japanese exports to China.