The Asian crisis and recession in Japan have hit European exporters hard, with the latest figures showing a marked decline in the region's trade surplus.

The trade surplus of eurozone nations with the rest of the world slipped almost 30 per cent in September 1998 compared with a year earlier.

The 11 EMU nations recorded a surplus of 5.2bn euros (£3.7bn) down 30 per cent from the previous year, according to Eurostat, the European Union's official statistics body.

And all 15 EU countries together recorded a trade deficit of 1bn euros ($1.15bn) last September compared with a surplus of 3.3bn euros a year before, Eurostat said.

Meanwhile, the UK's trade deficit rose strongly to 31.2bn euros between January and September, echoing exporters' complaints about the effects of the high pound.

A strong currency makes a country's exports dearer and its imports cheaper, worsening trade competitiveness.

Ongoing decline

Over the first three-quarters of 1998, the trade figures were more mixed.

The whole of the EU saw a trade surplus with the rest of the world of 14.3bn euros for the first nine months of 1998, down from 32.5bn euros in the corresponding period in 1997.

However, for the same nine month period the trade surplus in the eurozone held up well at 63.9bn euros, a small rise of 800m euros.

Asian fallout

The fallout from the Asian economic crisis and Japan's recession was seen as the biggest factor in the declines. Exports to Japan fell 14 per cent, Eurostat said.

Falling EU exports to the Far East were partly offset by an increase in exports to the US and China.

Eurostat said growth remained weak in both the eurozone and the EU as a whole.

German record

Germany continued to show the largest surplus among EU nations at 51.7bn euros.

Germany's own trade figures for November just out show a record surplus for the month.

The federal statistics office in Wiesbaden said a trade surplus of 8.54bn euros compares with a surplus of 6.44bn euros in October and a surplus of 5.8bn euros in November 1997.

However, a big fall in import prices was said to be behind the record rather than higher exports.

--BBC Internet