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Economy in Brief

Trade Expanding in Japan, Italy & India
by Carol Stone April 21, 2004

Trade flows are increasing. Three large, but otherwise very diverse countries reported trade data today which show markedly rising trends in BOTH exports and imports. This development indicates widespread gains in economic activity, that is, in the demand for goods in many parts of the world.

Japan's trade surplus is larger in 2004 through March than in recent years, but this is because exports have increased considerably more than imports.

In Italy, imports are growing, while exports are uneven. More detailed data suggest that energy imports are not the source of the rise in imports; as we explained here a week ago in discussing relative inflation rates, the rise in the euro through February may have held down the euro value of dollar-priced oil imports in such places as Italy.

For exports, the uneven pattern in recent months is actually an improvement, following a declining trend from late 2000 through early last year.

In India, where we cite US dollar-denominated figures, both exports and imports have climbed sharply. Commentary from the Indian government relates that March exports were affected by changes in reporting practices that speed up the processing of shipments information. But this is only a partial explanation, as indicted by the steeply rising trend throughout the period shown in the table and chart. The behavior of both kinds of trade flows in India thus corresponds to what we believe intuitively about the Indian economy. It is being strengthened by the role of outsourcing, so imports possibly of both intermediate and consumer goods may be rising even as exports increasingly make inroads into world markets.

Monthly Average
  Mar Feb Jan Year Ago
2003 2002 2001
Japan: Trade Balance (Bil.Yen) 1010 1184 1038 641 850 826 562
  Exports 4864 4802 4892 4359 4546 4345 4091
  Imports 3854 3618 3854 3717 3696 3519 3529
Italy: Trade Balance (Mil.Euros) n.a. -246 -711 +6 +56 +699 +817
  Exports n.a. 21799 20651 21088 21292 22144 22515
  Imports n.a. 22045 21362 21082 21237 21445 21699
India: Trade   Balance (Mil.US$) -172 -1866 -1560 -1105 -1245 -601 -569
  Exports 6518 5819 5037 4589 4670 4110 3591
  Imports 6690 7685 6597 5694 5916 4711 4159
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