Japan’s exports suffered their first fall in 16 months in March, after the magnitude 9.0 earthquake struck northeast Japan on March 11.
The Finance Ministry announced that exports dropped 2.2 percent in March from a year earlier, more than a median forecast for a 1.5 percent annual fall, Kyodo News reported.
With exports plummeting at a faster pace than economists predicted, the fall signals that trouble with shipments will continue to hamper economic growth. The earthquake and tsunami had already ignited a nuclear crisis, food scare, disruption in supply chains for many manufacturers, and rolling blackout for companies.
Bloomberg News reported that car exports slid 28 percent from a year earlier, while shipments for electronic devices also dropped as companies had trouble transporting goods.
"As supply chains are expected to recover in late May, the drop in exports may prove short-lived," Yuichi Kodama, economist at Meiji Yasuda Life Insurance, told Reuters.
"But due to power supply constraints expected in the summer, a full pickup in exports is unlikely until at least the end of this year. The Bank of Japan is likely to be prompted to ease its policy further in coming months," he said.
The island nation’s economy is expected to shrink in second quarter and then resume increasing in third quarter, since reconstruction efforts in the country’s northeast will boost the economy.