Three takeaways from Japan trade story

Japan's total exports dropped by 11.1 percent year-on-year in 2020, but its exports to China increased 2.7 percent, according to official data.

China has also replaced the United States as the largest exporter to Japan. That has much to do with China's success in containing the spread of the novel coronavirus and revitalizing its economy.

Japan's export of non-ferrous metals, automobiles, plastics and paper to China grew by 41.1 percent, 15.8 percent, 8.7 percent and 26.6 percent respectively last year. China's demand for steel also grew thanks to policy support. All this shows China's fast recovery and Japanese enterprises' confidence in the Chinese market.

The close economic ties between the world's second-and third-largest economies hold deeper meaning.

First, their robust bilateral economic ties have strengthened with investments expanding in many sectors, especially after the outbreak of the COVID-19 pandemic. The two countries have supported each other, raising expectations of greater cooperation in the post-pandemic era.

Second, China's key role in Japan's economic recovery is evident. After the pandemic broke out, there were calls for Japanese enterprises to leave China. However, only a few small enterprises did so, while some major enterprises increased investment in China. The latest investment figures show it is impossible for Japan to decouple with China. Especially, as Japan's exports to the US and the European Union have both dropped, its reliance on the Chinese market is expected to increase.

Third, despite the pandemic, the anti-globalization trend and trade protectionism, the signing of the Regional Comprehensive Economic Partnership agreement last year has shown good prospects for regional economic integration. The RCEP, which links 15 Asia-Pacific economies including the 10 members of the Association of Southeast Asian Nations, plus China, Japan, the Republic of Korea, Australia, and New Zealand, is a major breakthrough in building a regional free trade area. Economic ties between the countries are expected to flourish in the future.

- HAIWAINET.COM