BEIJING, (Reuters) - Japan’s devastating earthquake will have a limited impact on bilateral trade between China and Japan as the Japanese economy will bounce back quickly, the Chinese Commerce Ministry said on Tuesday.
China was Japan’s biggest trading partner and export destination as of the end of last year. In 2010, bilateral trade between China and Japan totalled $303.06 billion, according to ministry data.
“The disaster-hit northeastern part of Japan accounts for a substantial proportion of GDP, about 8 percent of Japan’s total,” ministry spokesman Yao Jian told a news briefing.
“At the same time this area has a concentration of several electronics, automobile and petrochemical industries. These products contribute quite a lot to China’s trade volumes. So in the short term there will be an impact on bilateral trade.”
Imports from Japan such as integrated circuits, raw steel materials and auto parts will be affected, he said.
But Yao said the impact on bilateral trade will be limited as “Japan’s economy will bounce back quickly”.
He added that Chinese companies and Japanese manufacturers in China could turn to domestic supplies.
“Inventory is sufficient to guarantee normal production,”Yao said. “Japanese companies in China can also find producers domestically to make up (supplies) to bolster production.”
China’s exports to Japan such as apparel, commodities and electronics will also be affected, but this will only be for a limited time, Yao added.
Japan faces a mammoth disaster relief and reconstruction effort after its worst-ever earthquake triggered a tsunami that devastated the country’s northeastern coast, killing thousands and spawning a severe nuclear crisis.
The government, which has been juggling relief work with a race to avert a catastrophic meltdown at a crippled nuclear plant, has yet to estimate the damage or say how much it may spend on reconstruction and where it will find the money.
Economists are certain the cost will exceed that of the 1995 earthquake in Kobe, estimated at $100 billion. Yao would not be drawn on the impact on Chinese imports of Japanese food. China has tightened checks after Japan found higher than normal levels of radiation in some food products.
“China imports very little Japanese food,” he said, adding his ministry was not in charge of safety checks.
China imported $593 million in agricultural products from
Japan last year, accounting for just 0.33 percent of Japan’s total exports to China.
Yao also said the political unrest in Libya was having a big impact on Chinese investments in the oil-rich nation.
He said the return of most Chinese working there due to the instability in Libya had hurt ongoing investments and operations, adding that China has 50 projects worth $18.8 billion in Libya.