The Ministry of Finance Japan has issued a new report on the fiscal situation which can be found here. This report is dated from December 2013.
Let's first focus on the trade and current account deficit in Japan. Both have been deteriorating rapidly in 2013. In fact, we are hitting new lows as we speak. The primary reason is that the yen has devalued a lot since 2013. As I noted earlier in other posts, the currency valuation is correlated to the deficit. If the valuation of the currency of a country goes down, that means that they will need to import products at a higher price and they will export products at a lower price. This naturally leads to a higher deficit. Evidence can be found in the soaring costs for importing oil to Japan. Oil imports basically almost doubled in price as noted in this article.
|Chart 1: Japan Current Account and Trade Balance|
|Chart 2: Deficit to Outlay Ratio Japan|
|Chart 3: Japan: Tax Revenue, Expenditures, Budget Deficit|