(Reuters) - Japan posted its smallest annual current account surplus on record in 2012 as exports weakened and energy imports grew, a signal to Prime Minister Shinzo Abe that economic revival needs more than just a weaker yen and extra spending.
The current account surplus is likely to continue shrinking as energy imports rise due to the closure of nuclear power plants and as Japanese exporters lose out to more competitive Asian rivals, economists say.
Japan's current account surplus was 4.7 trillion yen ($50.4 billion) in 2012, Ministry of Finance data showed, a figure that seems impressive. But it was less than half the surplus recorded a year earlier and the smallest since 1985, when Japan started compiling comparable data.
The deterioration was most marked at the end of the year, with Japan posting consecutive monthly deficits for the first time as the December shortfall hit 264.1 billion yen, more than 80 percent bigger than the median forecast in a Reuters poll.
"Energy imports and higher energy costs are structural factors that will cause the current account surplus to decline further," said Hiroshi Miyazaki, chief economist at Shinkin Asset Management Co.
"Currency moves can only go so far in improving corporate competitiveness. There are other areas like corporate taxes or incentives for business investment where Japan is lagging."
Abe, who won office in December, wants to "correct" the trend for excessive yen gains to help the eco...