Press Conference by the Chief Cabinet Secretary (Excerpt)

Q&As

REPORTER: I understand that Japan's trade balance for the last one year posted a deficit for the first time in 31 years. I believe the yen's appreciation and the earthquake disaster had an influence. What are the thoughts of the Government?

CHIEF CABINET SECRETARY FUJIMURA: This is the first time in 31 years since the so-called second oil shock that the trade balance posted this outcome. I believe the earthquake disaster and the yen's appreciation played a part as you just mentioned, as well as the decline in exports due to the slowdown of the overseas economy and other factors. And as related to the nuclear power station issue, the increase in demand for thermal power generation fuel played a part. The flooding in Thailand had some impacts. A number of such factors were involved, and we intend to continue to closely monitor the import and export trends. Nevertheless, it remains unchanged that our current account has a surplus. Recent trends in Japan's current account balance indicate that while our trade balance is experiencing a downward trend, our income balance is increasing. I believe we do need to keep in mind that Japan's financing method through trade or the structure is slightly changing. On the other hand, it is true that against the backdrop of the recent appreciation of the yen and other factors, concerns have been raised, including about the hollowing out of industry. In this regard, we believe that measures need to be promoted comprehensively to create new industries through regulatory reform and other approaches and to strengthen Japan's growth capacity. Likewise, we believe that it is important to also secure employment in Japan.

(Abridged)