U.S. Export Prices Not Boosted Yet
U.S. Export Prices Not Boosted Yet
Jan. 16, 1998
TOKYO (AP) _ While the suddenly mighty U.S. dollar has turned some Asian products into bargains for Americans, its effect on shoppers on this side of the Pacific is barely beginning to be felt.
In the flip side of the bargains Americans soon may be reaping on Asian imports, the stronger dollar normally would mean skyrocketing costs in local currencies for popular American exports like Starbucks coffee, Nike sneakers and IBM computers.
But there have been few signs of that happening so far.
With consumer spending deadened by looming fears of more corporate failures and a generally slack economy, Japanese retailers are loathe to raise prices _ despite the dollar's jump to a 5 1/2-year high of 133.86 yen on Jan. 6, which makes American goods more expensive for importers.
Elsewhere in Asia, where currencies have plunged even further against the dollar, the trend has been the same _ with retailers avoiding higher prices and instead turning to discount sales to keep customers from staying home.
One exception in Tokyo was at Tower Records, where an apologetic sign said: ``Due to the currency rate change, we will raise across-the-board prices on imported items 100 yen (75 cents) starting Jan. 6. ...We are sorry about any inconvenience, but we ask for your understanding.''
The new price for a Boyz II Men CD _ 1,890 yen ($14).
Another exception has been imported books.
At Tokyo-based Maruzen bookstore chain, the prices of U.S. hardcover books, which were converted at the rate of 183 yen to the dollar until Dec. 10, went up by 3 percent to 189 yen to the dollar and will rise further later this month, said spokesman Ryozo Endo.
But, for the most part, Made in U.S.A. still costs the same in Japan as it did before.
Levi Strauss 501 jeans, for example, range from 8,900 yen ($67) to 11,000 yen ($83), unchanged from 1996.
A pack of Marlboro cigarettes still goes for 260 yen ($2), a bar of Clinique soap for 3,000 yen ($23), a can of diet Pepsi for about 100 yen (75 cents) _ all no different from a year ago when the dollar cost 115 yen.
More crucial items also are not showing much of a dent.
Wheat prices in Japan are set by the government and unaffected by currency fluxes, while the drop in the basic price of U.S. corn and soya beans is likely to counter any effects of a strong dollar, said Toshikazu Kashino, spokesman for major trading company Marubeni Corp. in Tokyo.
It is unclear how prices will be affected in the long run if Asia's economic problems are allowed to languish. But in the meantime, many businesses across Asia have been reluctant to risk losing customers by raising prices of imported goods.
In South Korea, many shoppers have been favoring domestically made goods _ regardless of price _ as part of a national campaign to pull the country up by the bootstraps.
American imports could become even less popular if retailers start to raise prices because of the slump in the Korean currency, the won, which has lost about half its value against the dollar last year.
Prices for U.S. imports have held steady so far, but that may not last. Lotte Department Store, one of the country's largest, said prices may go up by 20 percent to 30 percent next month.
``Imported goods, including American ones, are losing their charm,'' said Lotte spokeswoman Ha Soo-yeon in Seoul.
In Indonesia, shopping centers were marking down Donna Karan dresses by as much as 70 percent.
In the nearby Philippines, the Fiesta duty-free mall by Manila airport, which sells U.S. clothes, shoes and appliances, has seen sales drop by more than a third recently. It has been offering a more favorable peso-dollar exchange to draw shoppers.