Exports fall by a fifth in November

Taiwan's exports fell by about a fifth in November as the world's biggest economies shrank, sapping demand for the nation's computers, mobile phones and semiconductors.

Overseas sales fell 19.7 percent from a year earlier to about US$10.19 billion after dropping 16.1 percent in October, the Ministry of Finance said. Imports tumbled 33.5 percent to US$7.95 billion.

That left a US$2.24 billion trade surplus, compared with a US$740 million surplus a year earlier.

Falling orders at companies like United Microelectronics Corp (UMC, 聯電) tipped Taiwan into its first recession in more than a quarter-century last quarter. Falling overseas sales may keep the nation's economy in reverse until mid-next year.

"Taiwan's economic growth in the fourth quarter won't be as bad as the third quarter, but it won't be a fast recovery," said Matt Yeh, an economist at Taiyu Securities Investment Trust Co (台育投信).

Taiwan is hoping for a recovery in the US economy, which shrank at a 1.1 percent annual rate in the third quarter, to revive growth in Taiwan. US customers such as Intel Corp and Nvidia Corp are among the biggest buyers of the nation's electronic goods.

Falling overseas orders prompted UMC and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world's largest makers of made-to-order computer chips, to lower their full-year profit forecasts two months ago.

Still, Taiwan's exports may start to rebound in coming months.

Exports will probably fall 11.5 percent this month from a year earlier, the smallest decline since April, said Hsu Kuo-chung (許國忠), director of the ministry of finance's statistics department. The government expects overseas sales to start growing in April.

Imports will probably fall 8 percent this month from a year ago, the smallest drop since February, Hsu said. That suggests manufacturers are stocking up on parts and machinery as they expect orders to rebound.

TSMC raised its full-year sales forecast by a fifth on Monday, citing higher-than-expected chip sales in October, and UMC said its fourth-quarter loss may be narrower than forecast.

Expectations that demand for computers and semiconductors will rise lifted the TAIEX 20 percent this week.

Electronics exports, which made up the biggest share of the total, declined 27.5 percent in November from a year earlier to about US$2.1 billion, after dropping 30.8 percent in October.

Shipments of mobile phones and other telecommunications goods fell 14.9 percent to US$1.5 billion, compared with a 25.6 percent decline in October.

Shipments to Hong Kong fell 10.3 percent to US$2.3 billion, surpassing the US as Taiwan's biggest market last month, as indirect shipments to mainland China rose.

Sales to customers in the US slipped 26.2 percent from a year earlier to US$2.1 billion, today's report showed. Exports to Japan declined 33.8 percent to US$989 million, and exports to Europe dropped 10.7 percent to US$1.9 billion.

For the first 11 months of 2001, exports fell 17.3 percent.

The government expects shipments to fall 17 percent for this year and grow 3.3 percent next year.