Group 1: Trade Surplus Overview - Japan's trade surplus grew from 1 trillion yen in 1965 to approximately 13.7 trillion yen in 1986, peaking at about 4.0% of GDP[8] - The trade surplus was primarily driven by goods, as Japan has had a long-term deficit in service trade[3] - The rapid increase in trade surplus led to internal and external conflicts, prompting Japan to adjust its trade policies[11] Group 2: Export Adjustments - Japan shifted its export focus from resource-intensive products to technology-intensive products, with capital equipment's share rising from 43.1% (1980-1984) to 50.7% (1985-1989)[11] - Exports to the U.S. decreased from 46.5% in 1986 to 34.6% in 1991, while exports to Asia increased from 30% to 47.9% in the same period[15] - Japan implemented export restrictions and diversified its markets to mitigate trade tensions, particularly with the U.S.[16] Group 3: Import Adjustments - Japan's import structure shifted, with raw materials' share declining and manufactured goods' share increasing; raw materials fell from 40.5% (1980-1984) to 20.8% (1985-1989)[28] - The average tariff rate in Japan dropped to 2.5%-2.6% in the mid-1980s, one of the lowest among developed countries[30] - Japan actively promoted imports through various measures, including reducing tariffs and eliminating non-tariff barriers[32] Group 4: Utilization of Foreign Exchange Reserves - Japan's foreign exchange reserves grew from approximately $3 billion in the 1970s to over $20 billion in the 1980s[53] - The government used reserves to stabilize the yen and mitigate trade tensions, notably through the Plaza Accord in 1985, which led to a significant appreciation of the yen[54] - Japan's foreign aid (ODA) surged to $8.965 billion in 1989, surpassing the U.S. and reflecting its enhanced international standing[55]