China Becomes Japan's No.1 Trade Partner: Financial 2006 figures show deepening economic interdependence

China became Japan's largest trading partner in fiscal 2006, which ended on March 31, replacing the United States for the first time since the end of the Second World War, according to preliminary figures released on Wednesday by Japan's Finance Ministry.

Japan's trade with China, excluding Hong Kong, rose 16.5 percent in fiscal 2006 from a year earlier, totaling 25.42 trillion yen (about $213.6 billion), while that with the U.S. increased 10.3 percent to 25.16 trillion yen ($211.4 billion). The trade data are measured on a customs-cleared basis before adjustment for seasonal factors and given on a yen-denominated basis.

The rising trend of Sino-Japanese trade is expected to continue amid a thaw in bilateral relations since Prime Minister Shinzo Abe took office last September. Under his predecessor, Junichiro Koizumi, who angered China — and South Korea — by repeatedly visiting the war-related Yasukuni Shrine, Sino-Japanese relations were said to be "hot in business" but "cold in politics."